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Bill Alexander

Red Letter Days

CEO

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Do your rewards encourage staff loyalty? Looking at the future of employee rewards

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This week we saw two great things happen for the U.K economy. Firstly, the BBC announced that the growth in the 2nd quarter of 2013 had reached .6%, outpacing initial economic forecasts according to the ONS. Secondly, we heard from Ernst & Young that UK GDP will accelerate to 2.2% in 2014, an impressive 1.1 per cent increase from 2013.

You may be wondering how these figures relate to the HR function, I would argue this data is of most importance to HR professionals going into 2014. As the UK economy continues to mend, HR professionals will need to review and update their rewards and benefits schemes to reflect the improving economic conditions. Are you prepared and able to ensure that your best employees will remain loyal once the job sector becomes more enticing? If your answer is ‘no’, then you need to refresh, revive and invigorate your reward programme.  

From what we are reading and the conversations we are having, it looks like the HR community is interested in prioritising employee reward as strategic part of their function. Even in 2010 a survey of HR professionals found that employee engagement was the main priority; 55% of the respondents were measuring engagement within their organisation and 88% were trying to improve it.[1] These figures are encouraging.

Creating and delivering an innovative rewards programme:

Across the UK business leaders are discussing the importance of loyalty, motivation, and retention as the key ingredients needed to empower employees and encourage engagement; I couldn’t agree more. A clear case has now been made for improving and delivering effective employee engagement and reward programmes. As widely publicised by the Gallup Business Journal, ‘meta-analysis verified that employee engagement relates to nine performance outcomes….strong correlations [exist] between engagement and performance [and this is] highly consistent across different organizations from diverse industries and regions of the world’.[2] The proof, as they say, is in the pudding; solid investment in your employee engagement and reward platform will give you a competitive advantage and directly increase your bottom line.[3]

Creating, and delivering a successful reward programme needn’t be a difficult and gruelling prospect. The tools and support that HR professionals need already lie within your organisation. Buy-in from senior management and support from your friendly finance team is critical. Armed with the knowledge that employee rewards programmes can drive your bottom line, increase your competitive advantage and ensure that loyalty is consistent among your workforce, you're able to make a powerful case for its necessity within your business.

For example, take a look at adding incentives and practical employee engagement communications tools to your rewards package. Employee incentives have become a common way for employers to invest in their staff and raise job satisfaction and retention rates. Incentivising your staff with aspirational and imaginative rewards can drive performance or help employees surpass targets. In addition, talent management tools such as-staff surveys and targeted internal communications efforts which focus on retention provide companies with invaluable employee feedback. Intelligently utilising these types of tools will support your goals of increasing loyalty among staff and ensuring that engagement is achieved.

Forging a partnership with finance to shape employee rewards for the future:

Recognising that the UK economy is nearly out of the woods, so to speak, it is vital that the HR and Finance departments focus on driving the organisations' discussions to maintain and revise their employee reward programmes. This is because the two functions are the initial touch points in the development of cost-effective loyalty and reward strategies and talent management issues directly affecting the entire workforce. If you are not already aligning your reward campaign with your Finance department, now is the time to engage in collaborative discussions to see how you can expand your platform and measure its success.

By working together, the HR and Finance functions can create bespoke reward schemes that tackle employee engagement, loyalty and motivation and most importantly enhance workplace performance and measureable ROI.

Now is the time to take a fresh look at your organisation's rewards strategy and approach. Have you identified an opportunity for closer collaboration between departments, particularly during the planning and execution process? Keeping ahead of the curve and exploring your opportunities will give HR professionals the best chance at successfully reframing their employee rewards schemes.

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