Sas Institute’s “Best Employer Award”

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SAS Institute’s “Best Employer Award” is based largely on its financial success and the overwhelming job satisfaction its employees report. From free health care to copious amounts of M&Ms, SAS spares no cost to keep their “chief assets” happy, for, as their CEO / majority owner says "Contented cows give more milk". Still, today’s talented workers are not apt to spend the majority of their careers at one company because of luxurious perks. The truth is that what seems like random and excessive, is actually a well-crafted and impeccably executed strategy to create an unparalleled work and life environment. SAS is successful in applying the principles of Cognitive Evaluation Theory that emphasize keeping employees’ cognitive attention on intrinsic rewards rather than extrinsic ones. SAS steers clear of Insufficient Justification or Insufficient Punishment by deemphasizing such extrinsic rewards as pay and promotion, and instead emphasizing intrinsic controllable rewards as membership within a community and a way of life. For example, SAS’s unique sick-day policy which, in contrast to industry standards, does not have a set number of allowable sick-days. David Russo states, “If you're out sick for six months, you'll get cards and flowers...”, and “We expect adult behavior". The result is that SAS employees average only two sick days annually. The focus on “Adult behavior” makes employees feel responsible for their obligation to the company as part of their overall reciprocity for all that the company has done for them. The lack of any real explicit punishment actually creates intrinsic pressure on the individual employee to not to take advantage of the policy in order to keep his self-perception in line with beliefs about being a good and accountable employee. By downplaying pay as an extrinsic reward and gauge of performance, SAS successfully uses Insufficient Justification to help in sidestepping the usual salary comparisons issues. The informational aspect of Cognitive Evaluation Theory is crucial to the understanding of SAS’s unique structure and policies. SAS avoids assigning tasks that have high probability of failure. Also it allows its employees freedom in choosing what to work on. As Goodnight states, “If they've grown bored with their job, they have great freedom to move horizontally instead of having to hunt for another employer.” Jenn Mann echoes Goodnight when she states, “nobody much cares whether you show up at 9 or 11.” Taking the focus off such trivial extrinsic matters frees up employees to focus their attention on intrinsic motivations such as having fun. Self-concordance suggests that these intrinsic motivations are stronger, more internally justifiable and therefore much more likely to make the individual work harder to achieve his goal. SAS uses Needs Theory to focus its recruiting on people who exhibit a high need for affiliation and achievement, while paying close attention to those with an overtly high need for power. To cater to high achievers’ needs managers make sure to assign tasks that are realistically achievable within the prescribed timeframe and the individual’s competencies. Managers provide subordinates with rapid feedback through everyday walking and talking techniques. Praise and recognition are also provided through increasing responsibilities and tasking employees with full ownership of their products including placing their names on the finished product. Knowing that high achievers generally do not possess the gamblers mentality, SAS tailors its incentive package around security and predictability. Bonuses are not emphasized and stock options are not granted. Instead, employees are offered a competitive salary, full 401K contribution and a myriad of non-merit based benefits for themselves and their families. For those with a high need for power, SAS provides autonomy, a collaborative environment and control over the life-cycle of a product. For example,...
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