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Employee Benefits News

Latest News
27 Apr 2015

Total Reward Is Evolving, Not Dying, Say Experts

Despite headlines declaring the death of total reward, a recent article on Personnel Today suggests that it is, in fact, simply evolving to become smarter, simpler and more flexible.

According to Duncan Brown and Martha How - authors of The Future of Reward Management - reward management is currently at something of a crossroads and employers will need to move away from traditional methods towards a “smart reward” strategy.

This involves measuring success clearly and providing more evidence for it; striving to engage staff and rewarding them according to their own needs; and paying more attention to communication and delivery.

But with more flexibility comes more responsibility from employees themselves, as financial and health wellbeing becomes a shared concern that they must contribute to. Whereas traditional reward models focus on what the employer could do for staff, modern reward is “more about dialogue, education [and] choice”, says How.

As with any new strategy, the greatest challenge for employers will be implementing it; but the key lies in making changes at a reasonable and realistic pace, she explained.

However Robert Gerdes, VP of compensation and benefits at CNH Industrial, argues that total reward strategy is still proving effective for the company´s global team of 71,000 staff, improving both their engagement levels and how valuable they find their rewards packages.

For Gerdes, the challenge lies in communication and the way information about benefits will be shared via new technology “with an ever-growing, multi-generational workforce.”

Matthew Gregson, consulting director at Thomsons Online Benefits, agrees that communication channels will need to adapt for total reward strategies to improve: “Total reward is not just about benefits, it is about every element of how you are supporting that employee´s life and giving them a better environment to work in,” he commented.

For example, rather than publishing annual statements after the employee benefits have been paid, employers could send out real-time alerts when something is being offered, or a colleague receives a reward.

While some agree with How and Brown´s philosophy, other argue that use of the word “smart” doesn´t have to mean ditching the old ways of doing things entirely, but using smart reward under the framework of total reward.

Mark Goodyer, head of reward at Sodexo UK, suggests that it could be as simple as rebranding the term ‘total reward´ for something like ‘new reward.´

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