Page 99 - Build a Culture of Employee Engagement with the Principles

70 Carrots and Sticks Don’t Work

a particular group. Research by Tom Tyler and Steve Blader
of New York University demonstrates that people experience
“group engagement” and work harder in groups they respect.
In addition, a study by Lakshmi Ramarajan, Sigal Barsade, and
Orah Burack from the Wharton School of Business finds that
respecting one’s organization serves as a buffer to burnout.
Thus, compared to less respected organizations, those perceived
as being highly respected enjoy a significant competitive advan-
tage in terms of recruitment, employee productivity, and tenure.
Another competitive advantage to being a well-respected orga-
nization is the likelihood that your products and services will
be highly valued and trusted by consumers. This is particularly
important during uncertain economic times when customers are
more likely to question a company’s stability: Will the organiza-
tion still be in operation in ten years? Will it stand by its work?
Does it cut corners?

The Importance of a Good Reputation The Reputation Institute
based in New York City has been ranking companies around the
world for the past ten years. Their research suggests that strong
corporate reputations are based on four concepts: admiration,
trust, good feelings, and overall esteem. Among the factors that
increase an organization’s reputation are giving back to the
community and transparency in business dealings. Although
I was unaware of this research by the Reputation Institute
when I founded ColorMe Company in 2003, I knew instinctively
that such values would not only enhance the reputation of my
organization but also increase the respect of those who joined
my team. Thus, I built the company on the principle that giv-
ing is good and established a unique and transparent policy in
which 10 percent of gross proceeds were donated to children’s