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Attracting and retaining talent in today’s economy is increasingly difficult. Enter reward compensation – the cutting edge of employee rewards
If it feels like we’ve all been talking about the great resignation lately, you’re not alone. We continue to talk about it because it looms so large in any business leader’s vision – and the organisational mindset of how best to retain employees in such a time is evolving rapidly.
It is increasingly clear that employees aren’t satisfied with average pay and benefits anymore. Even an above-average salary isn’t enough to retain employees if an employee doesn’t care about their work – or perhaps, more importantly, doesn’t feel like their work cares about them. A competitive salary is only the first step in showing this kind of workplace loyalty to employees, but organisations must create the right kind of ecosystem to support employees in many different ways.
Without such a comprehensive ecosystem, keeping the best talent will continue to be a struggle. In an SHRM survey last year, 49 per cent of surveyed executives reported that their company experienced a drastically higher turnover rate in the past six months, and 84 per cent stated that openings were going unfilled for longer than normal. Clearly, attracting and retaining good talent is of particular import to many business leaders. What can employers do to stem this tide?
The first thing to do is find out exactly why employees are leaving and what’s attracting them to other opportunities. Another SHRM study found that there’s a disconnect between why employees are leaving and why executives thinkemployees are leaving. Consider the following: per cent of employees are searching for new jobs because they want better compensation but only 26 per cent of executives think employees want better compensation. And that’s not all: 36 per cent of employees are searching because they want better benefits, but only 28 per cent of executives think employees want better benefits.
It’s clear that there’s a big disconnect between what employees want and what business leaders think employees want. Leaders need to realise that to recruit talent and build employee loyalty, they need a comprehensive compensation strategy – one that includes loyalty to employees.
But money isn’t the only way to do this. Loyalty isn’t created with pound signs – it flourishes best in an environment of care and emotional connection. Many think these principles have nothing to do with work, but to thrive through the challenges ahead, we must incorporate them into our existing employee retention strategies.
How to boost your compensation strategy
To keep good talent and attract new talent, we must ensure that people feel valued at work through both compensation AND recognition. Creating a culture where employees feel valued (another work-related way of showing care and emotional connection) plays a huge role in retention.
Here are a few other options to consider to increase retention.
Offer flexible work options: Fully remote and hybrid models of work are both great options that can enhance your compensation package as a whole. Some companies are even shortening their work week to offer greater flexibility for their workforce. That type of dedication to employees’ personal lives builds strong, healthy loyalty that goes both ways.
Give regular recognition: Recognition is a crucial part of your compensation strategy. In a recent study by Maritz, more than 40 per cent of people said they looked at a company’s recognition programme when considering employment. Furthermore, don’t assume that recognition and rewards need to include monetary compensation. Great examples of non-monetary recognition include verbal thanks, handwritten notes, official certificates showing appreciation or simply meaningful conversations between a manager and a direct report. It costs very little to express thanks and appreciation.
Provide educational support: When employees know their employer values their future and their success, they’ll feel valued. That’s where educational opportunities and industry certifications come in. Adding career growth into your upgraded compensation package will help employees gain additional skills, which will benefit both them and the organisation in the long term. Loyalty is a two-way street, and investing in your employees is a great way to maintain that road.
Monetary compensation is a piece of the puzzle
Money is still a large motivating factor for employees, and you shouldn’t ignore it as part of your compensation strategy. However, don’t be pigeonholed into thinking it’s the only thing you can do. If you already offer competitive pay, consider these options to entice talented employees to come – and stay.
Performance-based bonuses: The type of talent you want to retain is the type of talent that will exceed expectations more often than not. These are the types of people you need to strive to keep satisfied with the right compensation. As you reward them for exceptional performance, employees will stay motivated to strive for greatness.
Reward compensation: Offer compensation beyond a monthly salary. Providing a regular form of compensation (even if it’s only a few extra pounds, depending on each employee’s experience) is a great way to show your people you care about their happiness and their personal lives.
When you provide this reward compensation in a way that won’t necessarily be used for everyday expenses or bills (such as in the form of points), people will use it for items or events that they’ll enjoy rather than less exciting necessities. This type of bonus compensation will effectively build greater loyalty.
Reward compensation is a new piece of the puzzle that is coming to the forefront in many HR circles. Awardco is the pioneer of reward compensation and is at the forefront of facilitating greater equity in bonus distribution and compensation. Reward compensation will become the competitive edge many organisations can use to attract and retain good talent.
Turning the great resignation into the great retention
The great resignation may rage on for the foreseeable future. Building culture, driving behaviour and fostering loyalty that goes both ways is how businesses will need to approach this challenge. Above all, remember that when employees are shown loyalty and care, they’ll naturally feel more loyal and invested in the places they work. It’s a beautiful cycle that can strengthen organisations everywhere.
To learn more about reward compensation and how it can benefit your organisation, visit us online at award.co/awardco-pay
Originally published on Business Reporter