Q&A: Compensation Planning – the key to a satisfied and motivated workforce
At the end of October, The HR World’s webinar explored compensation and reward strategies with Andi Perger, Product Marketing Manager, Cezanne HR – sponsors of the session, Dr Duncan Brown, Principal Associate – Institute for Employment Studies and Paul Devoy, Chief Executive – Investors in People.
The discussion was informative, detailed, wide ranging and is well worth a view. However, there were still a couple of questions remaining when the session went out of time. So here are our panellists’ responses to those:
1: What, in your opinion, is the easiest and most effective reward/compensation offering you can give to your employees?
Andi Perger: Flexibility especially around non-cash reward items. I think it is important to understand what your employees value and need in the compensation package and align that with the business objectives and budgets. I think it is also more and more important to highlight non-cash benefits the organisation can offer e.g. flexible hours, working location and professional development.
Dr Duncan Brown: Pay! Seriously it is the biggest part of the reward package and its importance has got even greater in the col crisis. And if it is well structured and managed it appeals to a variety of staff motivators include recognition, achievement and fairness.
2: How important is it to ask employees what they want in their compensation package? Should I look to comparable organisations first and make sure we’re offering something competitive.
Andi Perger: I think the best approach is the combination of both. Understanding the market and competitors can give compensation professionals context and knowledge on recent trends, which are many! On the other hand, it is extremely beneficial to understand what employees really value – especially in today’s challenging talent market. Having a compensation strategy which aligns with employee needs can have an enormous impact on engagement and performance.
Dr Duncan Brown: Yes look at the competition and see what they do and how they pay. Paying under market doesn’t normally pay off. You end up losing people so it costs you more in the long term.
But be driven in your policies by what your business and your people need. Leader and employee involvement in developing reward programmes correlates more strongly with reward scheme success than any other factor.