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Getting an idea to an HR problem

Case study: How to cut attrition down to 9.3% by putting benefits dollars in the hands of employees



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Beloved author of witty books on travel, science and the English language, Bill Bryson, once wrote: “There are things you just can’t do in life. You can’t beat the phone company, you can’t make a waiter see you until he’s ready to see you, and you can’t go home again,” referring to his love for the unparalleled joy from visiting a new country.

Well, add another one to that list – pleasing all employees with your rewards strategy. Based in Singapore is Tarun Gulrajani, currently head of HR for APAC at Rehau, speaking about his past experience with another employer, when he faced a problem that didn’t seem connected to rewards to begin with.

[Read the full feature: The search for rewards strategies that please ‘em all]

He says: “We experienced high attrition of close to 25.8%, particularly among our sales professionals. As ours was a niche industry, it was not only costly to rehire and retrain, it affected our business performance as well due to loss of productivity.”

To get to the heart of the matter, the HR team carried out surveys across the region asking open ended questions to understand what employees were passionate about. An analysis of their answers pointed to an interesting trend – once a fair level of compensation was benchmarked across the industry, money wasn’t a motivator, or even if it was, it lasted for a very short time. However, employee benefits were dear to all employees, and their needs changed as they progressed in their career and life.

“We noticed a common theme, from employees who were single, to those married and with kids, to our mature workforce – their needs varied, from continuous learning, to giving up smoking, to giving back to the community. What appealed to Baby Boomers may not necessarily appeal to Generation X or Generation Y,” Gulrajani says.

The solution: A flex programme to allocate benefits

Upon brainstorming and multiple conversations with key stakeholders, the HR team decided to look into the entire employee benefits process.

Gulrajani details: “To experiment this new idea, I decided not to go for a big-bang approach, but see what would work on a smaller scale. I decided to target a country office with 30 employees. I involved the entire country HR team and not only the benefits team.”

Tarun Gulrajani's rewards dilemma

 

The team looked at benefits as a whole, that is, the amount of money spent on insurance, L&D, CSR and career progression. Taking this into account, S$2,000 was allocated per headcount per year, towards a flex programme where employees could decide how much they wanted to allocate to four wellbeing initiatives – health, social, educational and professional.

They had to meet the basic health coverage, after which they could decide how they wanted to internally allocate their flex dollars. A flex table was created for each employee through an in-house web-enabled application for them to modify and reallocate their dollars. The changes would be in effect for a year, post which employees were free to alter their benefits plan.

The outcome: Employee attrition down to 9.3%

“What we achieved was an engaged and productive workforce that could literally decide their fate and lives instead of complaining that the company did not do enough,” he says.

“More importantly it helped meet our objective of reducing our attrition down to 9.3% thus helping the company save money in the long run.”

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