Speaking to CFO.com, Mr Smith claimed that employers are failing to keep up with the consumer trend for customised services by making their pay, benefits, training and sales incentive programs far too rigid.
He told the news provider that this inflexibility could actually damage a business and cost them key, skilled workers, who will leave their jobs in search of better incentives and recognition.
In his new book, Workforce of One: Revolutionizing Talent Management Through Customization, Mr Smith says: "The notion that 'the same' equals 'fair' is completely backward."
"Everything people do today in their consumer lives, from a very early age, is customised," he added.
The Chartered Institute of Personnel and Development recently called for tailored incentives and recognition programs to be introduced in the public sector.