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Total rewards: All about the team

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Team workEmployers need to offer more than basic remuneration these days if they’re going to compete in the talent drought; staff need to feel loved. Matt Henkes looks how total rewards can add that missing value.


Shifting market forces and changing workforce demographics have put increasing pressure on firms to be more creative in the benefits they offer to staff. There is a strong emphasis on the alignment of pay and performance, and providing rewards that have real value for staff. And not just in monetary terms.

Recent research suggests that as many as one in three employers are taking up the total rewards approach, with a further fifth planning to implement it in some form over the next year.

“Why are many employers disappointed by the staff take-up on offers after an initial flurry of promotion?”

Adrian Glew, Personal Management Solutions

But let’s not get ahead of ourselves – your staff don’t come to work because of the great coffee in the machine. There is no doubt cold, hard cash is the main motivator for most people. However, with government warnings to keep pay rises in check in the face of further economic downturn and inflation, more creativity may be required.

The CIPD shares the government’s concerns, saying that increasingly inflated salaries could result in increasing unemployment. “If there are inflation-matching pay hikes, the consequence will not be a damaging pay-price spiral of the kind the economy experienced in the past but, instead, fewer jobs,” warns CIPD economist John Philpott.

Mulling the motivationals

So businesses have to come up with valuable rewards packages that won’t nail costs and still hold maximum value for the user. Not an easy feat. But the really successful companies have realised it also takes more than a carefully designed compensation and benefits strategy (although without this they are seriously hampered). A broader view of the motivational factors that attract and retain staff is required.

Compensation, benefits, work-life balance, performance and recognition, and career opportunities and development all need to be looked at. Staff need to feel valued and important to the wider aims of the business, so total rewards need to reflect the difference they make.

CIPD model of total rewards strategy

It may sound obvious but staff also need to be told about what’s available to them so they can maximise incentives. Adrian Glew is director of Personal Management Solutions, suppliers of the Perflex system. This tool allows staff to check what benefits are available to them, at any time, and see which ones they’re signed up to using their personal account.

Glew argues the need for such a system, pointing out that few employers put as much effort into communicating with their employees as they do with their end customers. “You wouldn’t leave your customers uninformed about what you were doing for them for months on end, so why are many employers disappointed by the staff take-up on offers after an initial flurry of promotion?” he says.

The HR team needs to treat this like a proper sustained marketing campaign; trickle information out to them and tease them with seasonal offers. Use your powers of communication to let them know how lucky they are.

It’s not just about engagement, it can be useful for retention as well. If they know exactly what they’re eligible for or can find out quickly and easily, checking this against a rival prospective employer will be simple. Just ensure that the total package you offer can rival your competitors.

The listening boss

The jewellery firm Beaverbrooks is one of the only retail companies to have consistently appeared in The Times’ list of best companies to work for. This year it was placed third.

The firm is a great advocate of total rewards and it’s easy to see why. Since 1996, staff turnover has been reduced from 50% to just 18%. “We do so well because we involve people in the business,” says Phil Jepson, head of HR at the firm. “The awards we win are voted for by the people because of the way we treat them.”

“Your customers get more from people that are happy doing a job they enjoy.”

Phil Jepson, Beaverbrookes

Working on the front line in retail isn’t exactly a picnic, he admits. “It’s generally pretty lousy hours and the pay isn’t as high as in a lot of sectors either,” he says. So how do they do it?

Right at the start of their employment, Beaverbrook’s staff are made well aware that the company takes their development seriously. Every single manager is recruited from inside the company through a comprehensive management training programme that is open to all staff that pass the initial six months’ training.

There’s nothing really new or even novel about this, but what makes it work so well is the communication with staff at every level, right from the top of the organisation downwards and back up again. For example, every employee has a monthly one-to-one meeting with their line manager to assess their development and how they’re functioning within the company.

“The beauty is they’re not just discussing their own development,” says Jepson. “With the one-to-ones they’re constantly giving the managers feedback on how things are going with the organisation through their eyes.”

All the company executives spend a lot of time travelling around the various sites to hold focus groups with frontline staff. They are also contactable at any time by phone or email to any member of the organisation. “That’s really key to getting people to feel involved,” he adds. “They know that we’re going to have a close look at any suggestions they bring up and do anything we can to see if they’re viable.”

You can’t measure exactly how much extra you get, says Jepson, but it’s easy to see. “You know you get more back from people that are engaged and happy doing their job,” he explains. “And your customers get more from people that are happy doing a job they enjoy.”

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