Best Practices for Aligning Your Reward Strategy with the Market
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Written by Steven Cox, Chief Evangelist at IRIS HR, a leading international HR consultancy, specialising in the support of global HR and resourcing from large corporations through to entrepreneurial start-ups.
Most employees desire a workplace where their contribution is valued, and they have the opportunity to make a difference. In fact, a surprising discovery on employee retention from one study found that 79% of employees who quit, or leave their role within a company cite a “lack of appreciation” as their main reason.
Fundamentally, if a business is striving for a more productive working atmosphere, and a strengthen employee retention rate, then it should consider a reward strategy. This will cover the employee benefits of working within a company, both contractually agreed-upon and as part of the company culture.
Yet, how can businesses ensure that their reward strategy maximises workplace motivation and employee retention?
A business can ensure its competitive edge in labour markets by offering a reward strategy that entices top talent globally. But, the best areas to include are often overlooked – here’s how to build a reward strategy that attracts talent.
Start with Salary
Competitive, transparent salary offers are essential in attracting talent, and keeping existing employees satisfied. This means compensation for roles must be in alignment with the industry expectations in order for it to be considered competitive.
HR and other department heads keen on talent recruitment, or retention projects, should aim to understand the labour market. What is the demand for the role like? What does the average salary package look like? Are there any variables in the pay, such as commission, bonuses or outside provisions to account for?
Not only will an effective understanding of the expected renumeration structures help companies to approach new and exciting talent, but your HR and Finance teams can build a budget more productively.
Benefits & Compensation
Outside of the expected renumeration per role, employee benefits and other forms of compensation can help to attract talent. This is often considered a key focus when approaching talent not only locally, but more importantly globally. Benefits, many believe, are equal to competitive salaries when it comes to employee satisfaction.
No two reward strategies will be the same. Businesses have a degree of creative freedom to build a package that aligns with their goals and budget. Yet, there are a few key enhancements that can help make your company more attractive to outside talent.
A few of these include:
More generous annual leave
Medical coverage
Private pension schemes
If your building a strategy for a global workforce, build your benefits around cultural norms from other, target countries. The final benefits package should weigh up attractive perks for the employee based on their position and the norms within their country. It’s fundamental to think about your target audience – their demographic, country, the social welfare estate and so forth – and consider what compensation provisions will be useful to them.
Culture Matters
When it comes to reinforcing your workplace, the company culture is a key foundation. For any project that involves retention or recruitment, culture should be a formative part in developing a productive, proactive workforce.
This becomes even more essential if your business operates globally. A company’s culture is its opportunity to advance workplace values and its ethos, whilst being respectful of other worldly cultures and perspectives.
Yet, culture will be different between each country and the businesses that operate within them.
Culture can seem elusive. It can describe a range of details about a company, whether about its sense of character and personality, or regarding the core values that motivates its business and employees. A culture is shared and, more often authored by those around your workplace. This can be opportunity to involve employee input and engagement from within, whilst building a culture and reputation that attracts talent from the outside.
Development Opportunities
Financial opportunity and growth are key tenets in any reward strategy. Yet, the modern workforce is increasingly after personal development and training benefits, whereby building their professional skills within an organisation. A culture of learning, according to another study, showed that training and benefits around development could boost retention by between 30-50%.
This can materialise differently, whether through shadowing qualified experts, training seminars, opportunities for growth through live projects, or simply by paying for qualifications. Ultimately, this perk speaks to an employee’s desire for progression professionally within their role and company.
Regardless of industry or market, coaching and training opportunities will attract more outside talent, as much as it will help upskill existing talent from within.
A reward strategy may uniquely reflect a company, its goals, and budget. But it’s major focusses should assess how much a prospective or existing employee can gain from its existing benefits. In a global market, being competitive means offering a package that excites, motivates and attracts all kinds of talent.
