10 rewards trends that all leaders need to know

10 rewards trends that all leaders need to know

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The secrets of the most successful rewards leaders, exclusively compiled for you across two conferences. Report by Aditi Sharma Kalra.

This is your opportunity to uncover what Asia's best rewards leaders do differently - we've drummed up our learnings from two pan-Asia conferences (Total Rewards Asia Summit - Singapore and Malaysia editions) to bring you the best of the conversation, from eliminating the stigma around using EAPs to building a predictive analytics framework and tackling under-utilised employee benefits. 

Scroll below for the 10 most-talked-trends among conversations with rewards and HR leaders. 

Stop linking performance to rewards: It's all about the skills

A vast majority of rewards leaders agree that it is high time that we stop looking at performance as the determinant of rewards, but rather the skills that employees bring to the table. This is especially so in the COVID-driven environment, where we are independent of locations, what matters are skills-based rewards. 

Having said that, performance continues to be one factor, but not the only factor.

So the amount of the annual bonus can be determined by performance; however, the base pay should not be dependent on performance, it should be dependent on skills. In fact, many took pains to point out that money is an enabler, but if you look at attrition data, it is not the primary reason that people leave.

Link rewards to not just money, but to your culture and mission

Rewards cannot be looked at in silos. They have to be looked at from the perspective of talent management and labour relations, and what they're incentivising needs to be linked to the culture and mission we want to build. 

The first step here is to have a really good listening strategy. "We need to have in place opportunities and platforms to listen to the demands, needs and insights of our employees."

The second step is communication. "Listening is just one aspect, but being able to articulate our findings as the connection between the business, culture, people strategy, and rewards strategy enables closing the loop on this linkage."

Eliminate the stigma of using EAPs: It's not about being weak, but about becoming stronger

A study by LifeWorks shows that over 50% of employees will consider leaving their current organisation for better wellbeing support. As such, rewards leaders are making conscious efforts to not only establish employee assistance programmes (EAPs), but change the entire perspective of employees to tap into them. 

The current stigma among the workforce is that perhaps EAPs are those who are "weak" or are facing "failure" of some sort - but the leaders disagree on this vehemently. "A lot of the culture in Southeast is established around not seeking help. There is a lot of focus on putting up this façade of being happy and if you’re not happy, it is considered a personal failure. We want to move them from a point of getting help from EAP because they have failed, to the point where they get help to become a stronger person."

As such, the priority for rewards leaders lies in positioning EAP as a programme to become more resilient as well as create a culture of self-acceptance (which can take up to six months or more). 

Build a predictive analytics framework for both globally-mobile as well as local employees

A predictive analytics framework is on the checklist for a lot of high-performing rewards teams, especially with the workforce comprising local, globally-mobile, and remote employees. 

Typically, globally-mobile employees have a tenure of two-three years, and have a set of certain KPIs before they are either assigned another role or are localised. So for such cases, a predictive analytics model can tell the manager and the employees that the tenure is coming to an end, as well as spotlight some of the other roles they may be interested in.

The cloud wage model is another trend to stay on top of. Considering how global the world is, companies are considering rewriting their job descriptions with a global amount prescribed to it, essentially enabling wages to be set at a global rather than regional/local scale. This wage informs what the role costs, and makes the role location-agnostic, giving employees a chance to do it from various locations.

Finally, rewards professionals need to keep their eye on inflation hedging. The way the business dynamics are changing, companies want to ensure their manpower five to 10 years down the line is staying within the budget (i.e. wage bill). 

A hybrid work arrangement requires conscious focus on social cohesion 

Working behind the laptop for months at a stretch can take its toll on relationships, thus your rewards strategy must include a conscious focus on maintaining trust and cohesion while working remotely.

Some of things leaders suggested include the more strategic, continuous communication driven by an agile culture; and the more tactical, weekly huddle, where not only work issues and concerns are discussed, but time is set aside to discuss informally on hobbies and such. A lot of companies are setting Fridays aside as knowledge day or wellbeing day, where the key thing is to be free from meetings. Employees can take the day to recharge themselves, sign up for online training, or simply finish up their pending work.

What all leaders pointed though is that this is not just HR’s responsibility – all line managers (including people managers, supervisors, companies), as well as the employees themselves must take accountability.

Tackle under-utilised employee benefits without impacting overall wellbeing

While restructuring company benefits, one category to look at is under-utilised benefits; between your fixed allowances and reimbursements, the latter is easier to maneuver.

What rewards leaders recommend is, before you change anything in your rewards structure, assemble a focus group or taskforce to survey employees on what they feel about the benefits that you believe may be under-utilised. Are they claiming for the sake of using it or is it genuine utilisation? Gym membership or online yoga sessions are typical examples of under-utilised benefits.

Once you've identified what to change, calculate the financial impact. Ask employees what they feel about these new evolved benefits, and take it from there.

Identify rewards that are most successful in driving positive behaviour change

Every organisation will have its share of change-averse employees for whom you'll have to work harder to drive positive behaviour change. In most case, the rewards experts suggests using variable pay as the best driver, and it depends how aggressively you use this based on the urgency.

But apart from the cash component, you have to look at it more from the point-of-view of career development and promotions – how you retain your top talent, not only driven by position, but based on performance. You have to make sure everything you implement is in line with your performance framework.

People leaders are also moving to a more spontaneous way of recognition, driven by the call for instant performance feedback. Don't hesitate to put in place spot bonuses and cash awards, and really maximise their value in rewarding the behaviours you want.

Build a shared understanding of the long-term retention strategy across generations

The retention strategy depends strongly on the demographics of your organisation, and whether you've sliced them up by generation or other segments. Nonetheless, rewards leaders constantly run surveys – ask them questions, what do they like, and are always listening for employees' feedback. Eg, do they actually enjoy long-service awards and the prizes that come with them?

At the end of the day, it is possible to have multiple strategies – be creative, be innovative, look for what works well in your organisation. Equally importantly, empower the operations and people leads to have a certain budget/flexibility to spark engagement activities (perhaps team yoga or zumba sessions) within their own teams, while the HR/rewards team focuses more on building the framework and reosurces for overall mental wellbeing & resilience.

You decide what works for your employees best in consultation with all their stakeholders.

Make recognition accessible to all: From office to shop floor

Oftentimes, recognition portals, powered by technology, are only available to laptop-bound office workers, and factory line workers don’t have access to systems, similar to field officers. Such gaps need to be addressed.

Firstly, you can ensure that the platform you're using does provide an app-based mobile solution, which doesn't necessarily mean that workers need to be connected to the main intranet system all the time, as long as the security measures are built in. Companies can also provide kiosks on the factory floor.

What most leaders have shared: "Having a recognition programme is most important; the platform is just the enabler. For certain groups of employees, however, the best is face-to-face recognition, such as townhalls." 

Assess if you can conduct total rewards analysis for your organisation in-house

Do we need data scientists to conduct total rewards analysis? This is a question often raised among rewards teams ready to accelerate to the next level.

The experts say the decision to hire full-time data scientists purely depends on your organisational budget and strategy, and if you utilise a centralised or decentralised model. More importantly, there are certain data science skills that every rewards professional should be equipped with, such as how to perform statistical Excel analysis.

Image / 123RF

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Follow us on Telegram and on Instagram @humanresourcesonline for all the latest HR and manpower news from around the region!

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