Moving away from the old-school entitlement culture, times (and circumstance) are changing and we’re seeing a new dawn in employee reward. The past few years have seen a huge increase in the amount of companies aspiring to a new form of reward, performance culture; something many companies more proactively sought after the financial events of 2008.
Performance isn’t just based on financials; the turnover and profit, it also focuses on employee behaviour and just how the financial results are achieved. As an employer ask yourself, are your employees displaying the right behaviours? And are these behaviours in line with company values?
When organisations change the boundaries and expectations of employee benefits, communication is key. Ensuring employees understand what they need to do to be rewarded and linking all of this to the overall business strategy can be a challenge, but strategic planning and effective employee communication detailing the revised reward programme will encourage buy-in from staff.
Lloyds Banking Group are one of the more recent organisations to consider a move away from annual bonuses and instead start to build a longer-term performance culture. The aforementioned buy-in from employees will also increase loyalty, improving company retention. Reward communication is fundamental for this to be achieved – but it’s not just a case of communicating ‘this is what you get’, but linking it to your business strategy, explaining how employees can influence it, what the criteria are as well as the company’s expectations of employees including behaviours to be exhibited.
Long-term incentives are a difficult subject to communicate because the value cannot be guaranteed. They may be complex by nature, but the returns and ‘value’ to employees if they are educated correctly are great. It’s not only the employee that benefits, companies get return on investment from long-term incentives.
