Welcome to ‘Compensation Insider’ – an initiative by HireSure.ai that helps you navigate the murky waters of total rewards. Our vision is to decode and optimise practices related to compensation philosophy, appraisal planning, compensation & benefits planning, ESOP planning, pay parity, the nature of rewards, job structure and so much more.
You’re here because you want to minimise the learning curve of org and compensation planning and make sure that you lead people first. Our aim with this newsletter is to provide you with all the arsenal (real-time data and insights) to help you put your people in the driver’s seat, and supercharge your company growth.
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Without much further ado, let’s dive right in.
Understanding the Space of Total Rewards 🏆💸🧑💼
Jack Welch, former Chairman and CEO of General Electric once said “If you pick the right people and give them the opportunity to spread their wings and put compensation as a carrier behind it you almost don’t have to manage them.”
So, compensation essentially acts as a fuel that pushes your employees to reach the pinnacles of their skill set 🚀
But, there’s a catch! If the fuel you’ve used isn’t enough or the right kind, it can make your rocketship crash as well.
To put it simply, Total Rewards is about discerning the needs of your employees and designing their compensation and benefits (both tangible and non-tangible) in a way that resonates with the expectations of your workforce.
❓How Total Rewards Has Survived the Test of Time
Back in the 19th century, recruitment, training, and management of workers was an inconsequential operation for businesses.
Due to the employers’ disregard, workers in the early 20th century sanctioned themselves into unions to get their point across (organisations needed to consider providing holistic work experience rather than just base pay).
The ultimate result of this change:
We now operate in an employee-driven HR industry.
Significantly, the Gen Z workforce today has redefined the parameters of how rewards and benefits 🏆work for them.
And the most notable difference from then to now is the growth in non-monetary rewards:
In fact, a study done by TINYpulse showed that 78% of employees feel motivated at work when they are appreciated and a Gallup poll states that 61% of employees want an improved work-life balance and personal well-being.
Given the mass uprising (just kidding), but given what the workforce really needs now, the rewards structure especially after the pandemic hit has been refurbished to focus on:
🫶Employee wellness
Research proves that “FTSE 100 companies that prioritize employee engagement and well-being outperform the rest of the FTSE 100 by 10%”
⚖️Work-life balance
88% of workers in a research conducted by Oracle feel that success is also about prioritising work-life balance and mental well-being
🏆Recognition
Bonusly showcased the results of a poll that demonstrated that 65% of respondents would be motivated to work harder if they were duly appreciated by the management
😌Mental health
More than 60% of employees would significantly improve the eNPS if their organisation took initiatives to promote mental well-being
📈Professional development
When it comes to professional development, 94% of employees would stay at a company longer if it helped them grow their learnings (Workforce Learning Report)
💪 What would a Solid Total Rewards Strategy mean for your Organisation?
To understand this, let’s take the example of Google which has been the reigning champion in the total rewards industry for a while now.
Google had Early in their journey established that non-monetary rewards incite emotions more positively and productively than hard cash rewards.
In fact, Google’s former HR Head Laszlo Bock has commented that “employees will end up happier if you give them an experience—something personal and nonfinancial”.
So, let’s dive in and have a look at some of the unique aspects of Google’s total rewards structure
🤝Thank you’s are important
They encourage peer-to-peer recognition by sending thank-you notes to show appreciation and promote a healthy work culture.
📈Progressive career development programs
This involves numerous initiatives like workshops, mentorship programs, online courses, job rotations, and so much more.
😌Ease of work
Google is known for creating a workspace where employees would want for almost nothing. Extravagantly generous, their benefits include nap pods, fitness facilities, shuttle services, free Google products, on-site childcare, and more.
💰Setting the salaries of its employees at the 90th percentile
They are just as competitive when it comes to providing cash compensation to their employees and choose to dominate the salary landscape.
Impact:
Employee satisfaction for Google employees has risen by 37% as a result of their employee wellness initiatives (Warwick University Research)
👀 How Maslow’s Hierarchy of Needs is a good way of Looking at Total Rewards
The pyramid of Maslow’s Hierarchy of Needs visualises a comprehensive picture of human needs from physiological to psychological.
If you look at the structure carefully, the hierarchy of job expectations works similarly in major workforces.
💡Hot Tip Creating your total rewards structure while keeping in mind the order of priorities dictated by “Maslow’s Hierarchy of Needs” will help you leverage the most out of a rewards strategy.
❗Real-life Examples of Exceptional Total Rewards Strategy in Organisations
- Patagonia‘s unique approach includes offering 60 days of paid leave for employees to intern with environmental activist groups, as well as comprehensive benefits such as flexible work hours, on-site childcare, organic food options and free yoga.
Additionally, if an employee is arrested during a peaceful protest, Patagonia will pay for their bail.
- Despite offering comparatively modest salaries, Costco Wholesale is known for its exceptional treatment of its employees, including benefits such as healthcare and retirement plans.
- Netflix is recognized for its forward-thinking and benevolent total rewards strategy, including benefits such as unrestricted paid time off, limitless parental leave, adaptable work arrangements, stock options, performance bonuses, and a complimentary subscription to Netflix.
- Cisco ranked 18th in the 2020 Forbes List of the World’s Best Employers. They are also known for initiating “Connected Recognition”, a global peer-to-peer rewards and recognition program.
- Siemens made an impact with its “You Answered” that allows cross-recognition with e-cards and redeemable points.
💯CompUp is here to change your Total Rewards Game
CompUp is a cutting-edge solution that offers comprehensive data-driven insights that can help your company create an effective total rewards strategy.
By using our platform, you can make informed decisions regarding key benefits packages that align with your company’s values and goals.
Our platform facilitates key decision-making by providing the insights needed to create a comprehensive total rewards strategy that will help you retain top talent and achieve long-term success.
Our data-backed approach helps you make informed decisions that optimise your people’s PnL strategy.
What Experts Think
Varun Tandon, Dunzo
“During times of economic uncertainty, a strong total rewards strategy can be a key differentiator in attracting and retaining top talent.
By offering a comprehensive package that includes competitive compensation, benefits, and opportunities for career development, organisations can build a loyal, engaged workforce.”
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