Reframing reward post-COVID: create a foundation for recovery and growth
The pandemic triggered a series of events that meant businesses had to immediately improve their liquidity and the company financial health. The turbulence had a significant impact on employees, not only their wellbeing, but it also changed the dynamic of their work as they recognised it. The Bank of England in November said whilst the vaccine has given us a ‘light at the end of the tunnel’, it will leave a legacy, in terms of how consumers buy and how businesses do business going forward - it will require ‘structural changes’.
Moving from reactive to proactively assessing current state against the future aspiration will place HR in control and will enable space to create a compelling, effective and sustainable people strategy that can support the business to transition from the recovery phase to the growth phase.
Stay competitive & optimise your Reward spend
Your Reward spend represents one of the biggest expenditures for a business, and it’s more important than ever to ensure it is working hard for you. Many businesses may be facing pressure to reassess how they approach the annual salary review, coupled with the need to look after employees and retain talent. The total salary bill and spend on Reward is significant, therefore it is a necessity for future sustainability to ensure that:
- You are tracking salary movements, trends and tracking your competitive position against it.
- You are staying ahead of the composition of pay and how prevalent practices such as regional pay or travel allowance are changing.
- Through analysis, assess where your reward spend goes and directing it to the areas that will add value.
- Staying on top of regulations, such as gender pay gap, ethnicity pay gap and CEO ratios to maintain confidence that the application of your reward policies does not have any untended consequences.
- Review bonus and incentive schemes, both short and long term, to ensure that they are fit for purpose and the features, metrics and rules will support and not inhibit future performance and cost management.
Transform and build agility into your organisation and role design
What this pandemic has taught us is that there is no room for rigid role definition and organisational structures. Businesses require their people to be deployed where capacity and skills are required with pace. Instead of defining and planning for potential scenarios the design needs to be more fluid and flex to any scenario. From the start, throughout and post pandemic, organisations will see their workforce and work design change shape. The composition of your organisational structure, roles, and employees in readiness for growth is key, therefore it is important to do proactive planning around the following:
- That you know where roles are needed to fulfil the performance and/or productivity demands of the business going forward.
- Have carried out workforce planning analysis, to identify talent demand, skills, capacity, and capability assessment to understand where skills are needed to drive competitive advantage.
- Used data analytics, to identify employee return value and productivity levels to identify where to direct attention for role effectiveness.
- Assessed where can build HR efficiencies within their function which will enable deployment of people and reward strategies at pace.
Empower, recognise and motivate performance
Employees have proven to be adaptable and resilient for their employer, even when faced with their own personal challenges. How employers conducted themselves through the challenges of furloughing, redeploying, and redundancies will be evident and employees and past employees will remember undesirable practices. Ensuring that they are brought on the journey of recovery and continue to be valued is of the utmost importance. Recognition programmes and performance management systems that may have been effective pre-COVID-19, could look very different post-COVID-19. Get underneath this by:
- Focusing on retention - look for new opportunities to engage your employees, recognise and incentivise performance and contribution.
- Identify where performance management or how it is managed has changed and what it needs to look like doing forward.
- Assess what is required to measure, drive and reward for performance against a new business plan.
- Review how employees will get back to learning, progress their competency, and prepare for career development opportunities.
Protect and nurture employees’ wellbeing
When organisations are through the other side of the COVID-19 crisis the aftereffects will still be having an impact on employees’ wellbeing. Economic recovery will take time and therefore the impact on employees will still need to be monitored and managed. Wellbeing cuts across mental, financial, physical, social, and environmental, therefore a comprehensive benefits package should provide support across all these pillars.
- How you curate and deploy an effective benefits package is important to ensure it is having the desired impact. Being clear on what the employee proposition needs to look like in 2021 will provide clarity and direction.
- Carry out analytics on the current programme to identify what employees value and need to leverage effectiveness of benefits and spend.
- Carry out a review of policies like absence and remote working to identify whether they are working as intended. Assess whether there are enough wellbeing support programmes in place.
- Develop and build the full employee proposition, providing a fresh approach, look and feel if it has been neglected more recently.
- Continue with or build a multi-directional channel of communications with employees and line managers. What best practice was deployed that could continue and what needs to be phased out?
Ensure that your reward and workforce practices are keeping up with the pace of change. As an HR or Reward professional, communicating with and anticipating what your leadership may need will allow for a joined-up approach. Giving it the attention it deserves will give you a stronger foothold within a competitive talent marketplace and can evidence a solid return on investment. I will leave you with 3 high-level waves:
- Beyond COVID-19, organisations must continuously transform. Technology and digitisation are changing how we do business and consumer behaviour, and that changes how work is fulfilled and the skills that are needed.
- From a virtual work perspective, there are no borders between countries. Organisations can buy talent anywhere in the world and alongside a multigenerational demographic, Reward very much needs to feel personalised.
- The UK economy has suffered from a lack of productivity across most sectors. The Government’s desire to drive up productivity by encouraging companies to invest in technology and infrastructure should start to filter through. HR have a role in identifying the employee return value and the return on investment from the people spend.
To drive the strategy towards the right aspirations requires data, which will create value adding analysis, insights, a strong benchmark and a clear direction of travel.
Innecto are here to help our clients cut through the noise and to identify what needs to change and what actions will get them ready to accelerate their post COVID-19 recovery. Get in touch by calling 020 3457 0894 or email firstname.lastname@example.org.
Have you registered for Pay Trends yet? Streaming live in the morning of 26th January 2021, we will be delivering your essential Pay and Reward update for the year ahead, analysing the year’s hot topics, helping you not only survive, but maximise the opportunities they provide. Whilst we are disappointed to not be able to meet with you face to face, we have so much to share! For Reward professionals interested in 2021’s top trends, this event offers a great return on your time investment. Find out more and book your ticket here.