This piece is inspired by this year’s pay review time – a time for new beginnings and decisions to be made relating to pay, performance and the Reward package for the subsequent year. It’s also, particularly from a communication perspective, a chance to reflect on who an organisation’s people really are, what they need and the role Reward plays in effectively engaging them.
So, I thought that it’s a good moment to pull together some insights and thoughts from the experiences I’ve had whilst working alongside some of the world’s leading Reward exponents and our clients – reflecting on how critical a dynamic communication strategy is when Reward is changing and adjusting to align itself to an increasingly agile world.
In their book Strategic Reward, Armstrong and Brown argued that a truly forward-looking Reward strategy seeks to “create Total Reward processes that are based on beliefs about what the organisation values and wants to achieve” (8). Alignment with organisation aspirations and values is indeed key, but “Total Reward” is just the tip of the iceberg. Reward is bigger than that.
More than ever before, Reward is a key enabler for driving business performance. The requirement for a successful articulation of the Reward proposition a business offers is now acute – to be competitive, attract and retain high performers is now paramount. Society, technology, demography and the economy have changed what people expect from their job. Peter Reilly et al. in a paper for the Institute of Employment Studies (IES) writes “Organisations such as Nationwide, McDonald’s, Standard Chartered Bank and Tesco have shown powerful linkages between Reward Practices, employee engagement and their financial performance,”.
When REMCO reviews pay they should consider Millennials, and of course Gen Z – the first generation to enter the workplace who have known only a digital environment. So, what should be now considered is the broader value of Reward and the communication channels used to reflect the increasingly diverse profiles of the workforce.
HR and Reward communication and engagement strategy needs to move away from thinking that the promoting of a range of benefits will drive competitive advantage. It’s time to be agile. On average, according to the American Institute of Certified Professional Accountants (AICPA), benefits comprise just under 33% of a Reward package. Communicating messages promoting benefits as making the difference is not going to be the benchmark for attracting high-performing talent.
Critical to the success of Reward is the mantra “What’s in it for me?”. This needs to be fully understood as part of the communication strategy.
To get you started, here are 10 Reward Communication Criteria:
Recognising the inherent power of Reward lies in its communication – “You’ll expect me to perform, to behave in a certain way, to deliver and generate ROI in whatever position in which I operate – in return I’ll expect to…”
For Reward communication to truly deliver, then it should consider the exciting everyday channels available to inspire and the unprecedented levels of data available to inform on a personal level.
Get all this right, and the Reward Proposition for any company is nailed!