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Case study: InterContinental Hotels Group Singapore

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Frances Chee of InterContinental Hotels talks about the art of handling compensation and benefits, and why it’s not always as easy as one might expect.

Managing compensation and benefits “is an art, not a science”. That is the belief of  Frances Chee, director of compensation and benefits at InterContinental Hotels Group of Singapore.

“There is no right formula for everything,” she says.

“It is more than just reading spreadsheets; it’s about putting meaning into the numbers, and identifying anything that “sticks out like a sore thumb”.

The success of compensation and benefits structures also depends on HR’s ability to translate the cold hard numbers into relevant visuals such as graphs and charts so they can be understood easily by anyone.

There’s more to it if you know how to appreciate how these numbers come about, and understand how they will impact the business at the end of the day.
By understanding the numbers, the hotel was able to tailor its compensation and benefits offering to the employees. This is why Chee says the hotel provides three basic packages when it comes to compensation and benefits. These three packages include healthcare, life insurance and pension funding.

She highlights the international health care coverage provided by the hotel offers premiums more than 10 times that of other companies. However, she adds in order to manage costs at the expense of the organisation’s budget, sacrifices have to be made.

For example, she said organisations “could do away with company dinner and dance”.

Nevertheless, she feels it is something worth investing in, and something that is necessary to keep employees happy and satisfied.

“It is a matter of measuring what is core to your business and what you need to do to survive as a business organisation,” says Chee.

Competitive international compensation and benefit packages are also created to target the significant pool of foreign talent in the organisation, despite the hefty cost incurred.

As one of the basic perks offered by the hotel, pension schemes are offered in hope of gaining a “life long relationship” with their employees.

As foreigners are not entitled to CPF because they are not Permanent Residents, this serves as an attractive perk, particularly for those of them who travel extensively.

The scheme also remains consistent and transferable to wherever they are stationed, be it in Singapore or Thailand. Additionally, it can be adopted for different job functions, be it in a corporate office or hotel setting.

“We don’t wish to lose our talent to external competitors. To us, pension is something that provides assurance that I look after you as an employee on a life-long basis.”

As it supports mobility for staff greatly, “employees can be assured that wherever they go, they won’t lose out”.

Even then, such perks might not sound as attractive to all, particularly the younger generation, as they are not as concerned about using the funds.

“They would say ‘I won’t use it until I get married or buy a house’.”

A crowd that’s hard to please

While a fair compensation and benefits package aims to provide staff with a better and well-balanced employee experience in the organisation, it is almost impossible to completely satisfy all of them.

Chee describes her job as a thankless one due to everyone’s entitled mindset. “No one will ever tell me, ‘Thank you Frances, for paying me well’.”

“But as an employee myself, why would I thank my boss and say, ‘Hey boss, thank you for paying my salary’,” she asks humorously.

Employees look not only at a competitive salary package but also at the other benefits provided.

“Will increasing your salary make you a happier employee?” Chee asks. It might enforce engagement temporarily at most, but they may ask for more the next day.

Monetary perks may not be viewed at attractively by everyone.

“Some may be looking at courses, career development… an employee might look to pursue his Master’s Degree and ask for sponsorship.”

At the end of the day, there will still be a “bottomless pit” of challenges where anything can “pop-up” the next day, she says.

It is common for employees to always demand for more, because there is no harm doing so and “nothing is stopping them from asking”. In fact, she encourages them to speak up and ask for more because it keeps her on her toes.

“We appreciate the feedback and open communication… If there is anything they are unhappy about, I would be more than happy to engage in a meaningful discussion with them.”

She adds the younger generation, namely Gen-Ys, aren’t making things easier.

“They are more informed in terms of exposure to media, and everything is a ‘Google’ away,” she says.

However, being exposed to more information doesn’t mean you are exposed to the right information. This is when communication plays an important role.

I rather you come and clarify (your opinion) with me rather than believe in the information you have, which might not be the clearest.
Nevertheless, an employee’s level of happiness can be measured in many different ways; be it through surveys or from the attrition rate of the organisation. She believes it is not just the compensation and benefit practices, but the entire employee experience that affects how happy employees are.

At the moment, Chee says she is still looking for the “golden manual” which will successfully pacify everyone’s constant demands, if there is one.

For now, she has bi-annual surveys to fall back on. These are conducted in order to measure how employees feel about the compensation and benefit practice at the hotel.

“I will never get good scores for that,” she says, comparing the results to other areas in the survey scoring an 80-90% in staff satisfaction.

However, according to survey provider TNS, their employee satisfaction score of about 70% is in fact much higher than the market average score ranging from 40% to 50%.

Every year, the management will look at the surveys and ask “what more can we do to make things better?”

However, they need not “kill” themselves over the current compensation and benefit scores, she says.

Identify the problems and accept change

Chee says she has to always be prepared and keep up with change, adding the hotel is constantly looking for ways to improve.

The hotel is currently reviewing its incentive plan, as it aims to keep it competitive for all job levels.

Chee is also looking at becoming more creative in her approach - to break the mould of standard compensation and benefit practices.

We want to be creative, while not incurring more costs, and yet still meet the business and employee needs.
Yet, employee needs can also change over time, and something offered in the past might not work as well now or even within six months since its implementation.

“It’s the constant feedback that comes through, which help us as well,” she says, adding they help her identify what is good and what is not.

Learning from past mistakes, Chee adds she should have been more “proactive”, rather than “reactive” to change.

She says there should also be more avenues for sharing of best practices, not only within the organisation, but also among other businesses across the industry.

Chee describes such avenues as an open “forum” where customers, workers and managers can share information and their best practices.

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