Case study: Why 9 out of 10 staff are proud to work at SMRT

To build a high performance and engaged workforce in a complex operating landscape, SMRT designed its C&B schemes to be market competitive, and aligned to business performance along five strategic thrusts: improve operational performance, enhance the customer experience, strengthen workforce health, instil organisational excellence, and ensure sustainable growth.

“We leverage on our compensation and benefits schemes to power SMRT’s transformation and drive cultural change,” said Koh Teck Chee, deputy director of careers and rewards at SMRT.

In line with its pay-for-performance philosophy, the firm rewards performance and productivity – not just based on the performance of the individual, but also that of the organisation. This can be seen from its annual bonus allocation mechanism which comprises company and individual performance components.

By establishing a common set of goals for all staff in the company, HR fosters greater collaboration and shared ownership across the organisation.

Recently, the company reviewed its rewards structures to meet the different requirements of its fare (that is, public transportation) and non-fare businesses.

A greater emphasis was placed on operational performance for its fare businesses in trains and buses, while financial achievements were weighed more for its non-fare businesses such as advertising and commercial activities.

Salary reviews and competitive benchmarking are also conducted regularly as part of a bigger plan to enhance the career development and progression of all employees.

In addition, performance-linked incentives are purposefully scheduled on both a long-term and short-term basis to maximise staff motivation to induce better performance and higher productivity.

SMRT also utilises non-monetary measures to complement monetary rewards by applauding individual and team excellence, and celebrating company successes at key events.

The company’s competitive rewards and compensation packages have enabled HR to grow SMRT’s headcount by 30%, despite a tight labour market.

SMRT successfully attracted and grew its engineering headcount by more than 100% to about 400 today, despite Singapore’s acute shortage of engineers. The firm was also able to attract a pool of experienced global talent to kick-start a new subsidiary, Singapore Rail Engineering, in 2014.

Voluntary attrition rates halved to reach a low of 5.3% this financial year (ending in March). Employee engagement scores are at best-in-class levels, with nine in 10 staff being proud to serve at SMRT, and 86% of staff being sustainably engaged – a noteworthy increase from the 82% score in 2013, which places the company way above the Singapore norm of 80%.

Customer service levels and network reliability have also improved. The compliments-to-complaints ratio improved by 25% over the past year; train delays of more than five minutes have dropped from a peak of 1.8 incidents per 100,000 km to 0.7 now; and the number of trains being pulled out of service dropped from three per 100,000 km to less than one now.

In addition, the firm’s profits remained resilient despite big increases in spending on maintenance and the renewal of ageing rail assets.

This is partly attributed to productivity gains even as wages grew – economic value added per employee increased 6.5% from FY14 to FY15.

Moving ahead, SMRT will continue to review its compensation and benefits strategy to shape workforce culture and provide meaningful careers for its employees.

For more case studies from Astro, Singtel and Avnet, and tips for building a top compensation and benefits strategy, head over to the Human Resources’ March feature.