Even with all the hard work done by compensation and HR leaders, most employees don't understand the value of their employment package. And many managers don't know where to find the information necessary to explain the total value of employment. The result: unnecessary turnover, frustration, costs and wasted time.
Please join us for an exclusive webinar with experienced compensation consultant Zachary Weinberger. Zachary will share inside strategies and best practices on how leading organizations are successfully communicating total rewards programs to dramatically improve engagement and retention.
In this webinar you will learn how to make your existing compensation program a powerful retention tool including:
· How to balance theory and practice
· How to apply a transparent model to communicate total employment value
· How to analyze your audience and use technology to communicate total rewards
· How to leverage multiple communication channels to maximize engagement
4. Communicating Total Rewards
3 Keys to Building Engagement and Retention
Zachary Weinberger
Managing Consultant
Remuneration Resources, LLC
www.RemunerationResources.com
5. What We’ll Cover Today
The true impact of rewards communication
1. Balancing theory and practice
2. Applying a transparent model to communicate
total employment value
3. Understanding your audience and using
technology to communicate total rewards
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6. How good are we at communicating rewards?
Towers Watson’s 2014 Global Workforce and Global Talent
Management and Rewards study shows only half (52%) of employees
feel their company does a good job of explaining pay programs
29% of respondents in a 2007 WorldatWork survey said that pay
communication is the component of their company’s rewards
program most in need of improvement
53% of respondents in Payscale’s 2014 compensation survey felt their
organization does not offer managers training to teach them how to
talk to employees about compensation
Incentive plans are intended to drive behavior yet only 31% of HR
managers believe employees understand how plans operate
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7. The Solution
Make it simple
Explain why; not only what, when and how
• When they understand the rational, people assimilate information better
Share more information rather than less
• Nature abhors a vacuum – the less information employees have the more
they invent (rumor, gossip, etc.)
• The more information they have (up to a point) the better they understand
and accept the information
Use multiple approaches
• Not all audiences need the same information
• Not all people absorb information the same way
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8. OBJECTIVE OF COMMUNICATIONS PROGRAMS
Tactical:
• AWARENESS: Improve awareness of the different elements of the
total compensation program
• UNDERSTANDING: Provide clarity around the total compensation
program
• APPRECIATION: Communicate the collective mix and relationship
of various pay elements
Strategic:
• ENGAGEMENT: Employees are loyal and productive
• RETENTION: Employees stay with the company
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9. In Short
The goal of a rewards program communication plan is:
For your employees (present and future) to see their rewards
package as the tremendous offering that it truly is, they need to
understand it. This starts with grasping your company’s
compensation philosophy, your base pay system, your bonus
programs, and the role your culture plays in promoting and
supporting career growth.
If your rewards communications connect the dots between their
benefits, pay, performance, and career development employees
will be increasingly engaged and loyal.
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10. 1. Theory and Practice
Theory: a contemplative and rational type of abstract or
generalizing thinking, or the results of such thinking. A theory
provides an explanatory framework for some observation.
• The rationale…
• Why we do it …
• How to think about it …
Practice: the actual application or use of an idea, belief, or method
as opposed to theories about such application or use
• How to do it ….
• What we do …
• The processes we use …
• How to pick a starting salary
• How to process a merit increase
• How the bonus plan works
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11. What are we communicating?
Rewards philosophy
Rewards program objectives
Rewards process
• Mechanics
• Base pay plans
• Plan changes
• Incentive plans
• Benefit plans
• Benefits plan changes
• Total rewards statements
• Mobility programs
• Etc.
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12. How Much Theory
10% to 80% theory
• 10% - general , broad based employee communication
• 80% - HR compensation training
Philosophy underlies theory
Theory is why the process is what it is and the rational for
decision making
• Can be strategic or tactical
Practice is the process or processes we follow
• Can be tactical or operational
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13. 2 Transparency
Transparency: as used in science, engineering, business, the humanities and
in other social contexts, implies openness, communication, and
accountability. Transparency is operating in such a way that it is easy for
others to see what actions are performed. It has been defined simply as "the
perceived quality of intentionally shared information from a sender". (1)
The level of transparency depends on the compensation philosophy and
culture of the organization
• Trend is to greater transparency
• With transparency employees get accurate information rather than false rumors
• Greater transparency builds trust in the organization which leads to greater
engagement
(1)Schnackenberg, Andrew K.; Tomlinson, Edward C. (March 2014).
"Organizational transparency: a new perspective on managing trust
in organization-stakeholder relationships". Journal of Management
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14. How Transparent are we?
39% - No salary range information
22% - Limited salary range info (employee’s range)
8% - Limited information (employee range and next range up)
18% - Some other approach
13% - Transparent
Pearl Meyer – Published in WorkSpan 2/13
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15. How Transparent Should We Be?
As transparent as possible
To increase transparency, we must actively include greater
disclosure, clarity, and accuracy in our communications
Do not loose simplicity and clarity - too much information does
not increase transparency
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16. 3 Who is the Audience?
Senior Leadership – need to understand and endorse rewards plans and programs
Executives – need to understand and approve rewards plans and communication
programs
Human Resources - need additional training and information to help answer
manager questions
Managers – need additional training and information to help answer employee
questions, in addition to understanding the information as it applies to them
Employees – need to understand rewards plans and programs
Employee Families – need to understand impact on them
Other…
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17. Communication Channels
Face to face meetings
Print
• Presentation Decks
• Brochures
• Post cards
Direct mail
Email
Portals – will it also work on a smartphone?
Social media
Online modeling
Other…
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18. Making the Message Stick
Classical forms of communicating include:
• Ethos – credibility of message (messenger)
• Pathos – emotional appeal
• Logos – rationale
Identify key messages
• While balancing theory with practice: be focused
• Be clear and simple
Be Relevant
• explain why the message is important to the audience
- answer “what’s in it for me?”
Start at hire and continue throughout the
employee life cycle
• Annually
• Quarterly
• As needed
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19. Measure Success
Is content accurate and understandable?
Is content being delivered?
• Are communications sessions taking place?
• Are employees receiving print and electronic communications?
Do HR and line managers feel they
can answer employee questions?
– survey them
Was the merit process completed
timely and with few complaints?
Did employees sign up in the
proportion desired?
Was the reaction as expected?
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20. Overall Summary
Philosophy guides Strategy
Strategy guides Communication (tactics)
Simplify the message (simple design helps)
Provide as much information as organizational culture will allow
Prepare HR and Managers more ( they need to answer employee questions);
Gear communications to various audiences
• Differentiate by audience
• Be inclusive
Communicate early and often via multiple channels and in balance with other
HR and company communications
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Thanks and welcome
Compensation and rewards are one part of engagement and retention. Others include… internal forces like work environment, development opportunity, organizational brand (prestige) - external forces like economic environment, pay levels at labor market competitors
Employees who understand the company’s overall compensation strategy, philosophy, pay-setting processes and the rationale behind each pay and benefits component are more likely to feel valued as employees and comfortable with their total compensation packages. Communication should start at the time an employee is hired and continue throughout his/her tenure with the organization. Ultimately, an effective communications strategy can help protect the significant investment companies make in pay and benefits programs.
Normally I like to have a conversation with plenty of give and take.
A webinar like this with lots of participants makes that hard. We will have a Q&A at the end of the presentation. Still, please submit your questions as we go along for two reasons. One, I will try to answer some of them as I go and two, you may not remember your questions if you just save them.
I want you to take at least one useful thing from the time you are so generously giving me so I will tell you now there are three things I want drive home
1 – employees and managers are better for understanding a bit of theory – what are the basic drivers of compensation thinking and decision making
2 – more transparency is better – to the extent your culture will support it, share information. The more people know the less they invent
3 – one size does not fit all – almost every message has multiple audiences and the message needs to be delivered in the most appropriate manner
Most of you probably know this already and after this presentation you can tell your friends and coworkers, bosses and teams, that an expert with 30 years experience and 3 graduate degrees validated that what you know is right.
Not very good!
Opportunity – better communications
Communication greatly impacts perceptions of competitiveness and fairness
Make it simple – not keep it simple
Why = theory
More = transparent
Multiple approaches = audiences and channels
Strategic, Tactical, Operational
it’s really all about managing employee expectations: if they believe they’re being compensated fairly and can look forward to future rewards, they’re likely to remain loyal employees; if they perceive their compensation as “less than,” they’ll seek greener pastures. And the lynchpin to managing expectations with respect to compensation is effective communications.
What
Often we focus on communicating what has changed, there is a new bonus formula or a new benefits plan.
Or how to process something, click here, enter number there click submit for a merit increase
If managers and employees understand the theory behind how decisions are made and the philosophy that supports those decisions they will do their jobs better and for understanding why they are doing something.
This leads to better engagement.
Urgent and Important
Theory helps explain (provide rationale) for practice/process
New programs v. ongoing programs – no difference; all need ongoing reinforcement
Through all these we want to communicate that the company or organization provides fair and competitive programs and cares about its employees
Reasonably concerned about info overload and have urgent need to communicate what’s changing or happening or about how to process a pay increase.
What theory adds is the why…
We never want to communicate 100% theory. Practice ties the theory to experience and gives it context just as theory give practice context. They compliment each other.
Practice is often a combination of tactical and operational. For example: during the merit process determining the increase amount for a given employee can be tactical (how do I reward and engage this employee) and it can be operational (how do I enter the increase into the record keeping system so the employee gets paid)
E.g. when managers understand the concept of labor markets and the process of survey participation and benchmarking they better understand and apply pay setting programs. They also better accept the pay structure.
Story: Over the course of several years we moved to a more automated merit process. In year one we communicated about the new platform and how to log in and how to enter increases etc. We had lots of questions not only about how to use the system mechanically but about how to allocate increases etc. In year two we added a little theory, the concept of placement in the range based on experience and performance, and not only did we have fewer questions about the mechanics we had many fewer questions about how to distribute increases.
Story: In manager training we talked about the concept of a labor market, comparing it to a housing market. We talked about salary surveys and benchmarking as well as the notion of best available data. There was also some material on the idea that all business decision making is done with best available data. Subsequently we had much more positive discussions with trained managers about market data, pay ranges and determining pay levels for new hires.
What
Shared information supports engagement
Transparency supports engagement
There may be some influence of local culture and practice (e.g. in Asia historically senior managers make all pay decisions) Becoming more transparent here is more about getting managers to change their practice and share the decision making than local cultural practices.
Relevance
Context
Once a year is not enough
Delivering bad news
Early
Clearly
What/who is impacted and how
Message should come from the top – show empathy
When, Who, How
Give key Stakeholders a feeling of involvement
Be consistent – build shared understanding
Other – shareholders, customers, competitors (may be indirect audiences)
Face to face will often be informal – an employee asking a manager or HR representative.
HR and managers need to be prepared to respond effectively to employees. This may be as simple as “call the HR call center” or as difficult as saying “I made this decision and this is why…”
Technology can support communication
Leverage multiple communication channels to maximize engagement
Is the HR call center ready to answer employee questions?
Read, heard, discussed
gamification
There may be some debate about which is most important…
One on one – body language, eye contact, listen when appropriate, etc.
Quantitative measures of success of a communications plan are hard
Most will be qualitative
4 Potential Pitfalls:
Not anticipating defensiveness
Undervaluing direct interaction
Declaring victory too soon
Losing sight of the big picture
Philosophy and strategy are the basis for action – what’s communicated