Reward June 2013

Topical reward issues for the second half of 2013

by Toronto Training and HR

June 2013

CONTENTS5-6 Definitions

7-8 Philosophy of reward management

9-11 Total reward 12-13 Conducting a compensation impact analysis

14-15 The model of effort-reward imbalance

16-17 Drill A18-21 Why have a reward strategy?22-26 Developing a reward strategy27-28 Drill B29-30 Job evaluation31-36 Recognition37-38 Applying a reward and recognition program39-40 The four Ps of reward41-48 Trends in 201349-50 Conclusion and questions

Introduction

Introduction to Toronto Training and HR

Toronto Training and HR is a specialist training and human resources consultancy headed by Timothy Holden 10 years in banking10 years in training and human resourcesFreelance practitioner since 2006The core services provided by Toronto Training and HR are:

Training event designTraining event deliveryReducing costs, saving time plus improving employee engagement and moraleServices for job seekers

Definitions

Definitions• Intrinsic rewards• Types of intrinsic rewards• Extrinsic rewards• Types of extrinsic reward• Reward management• Recognition

Philosophy of reward management

Philosophy of reward management

• Strategic sense• Total reward• Differential reward

according to the contribution

• Fairness, equity, consistency and transparency

Total reward

Total reward 1 of 2

• Definition• Pay• Benefits• Learning & development• Work environment• Armstrong & Brown model

Total reward 2 of 2

Total reward

Conducting a compensation impact

analysis

Conducting a compensation impact analysis

• Determine the objectives• Identify the market• Gather tools• Share findings up and

down

The model of effort-reward imbalance

The model of effort-reward imbalance

• Transmitter systems• Imbalance is maintained

under certain conditions• The imbalance between

high effort and low reward increases the risk of reduced health

• Overcommitted people are at increased risk of reduced health

Drill A

Why have a reward strategy?

Why have a reward strategy? 1 of 3 • Can play a central role in

shaping reward policies and practices when aligned to the organization’s culture, values and objectives

• Communicate and reinforce what the organization wants to and wants not to reward

• Drive change on pay, benefits and wider reward so that it is aligned

Why have a reward strategy? 2 of 3

WHY DO THEY NOT DELIVER?• Focus on best practice• Focus on design at expense of

shareholders and implementation

• Focus on ‘what’ outcomes can drive unwanted behaviours

• Changes not aligned to the organization’s culture and values

• No clear means of measuring or evaluating success

Why have a reward strategy? 3 of 3

WHY DO THEY NOT DELIVER?• Skills and abilities of line

managers in implementation• Perceived as a HR initiative

and not driven by top leadership

• Insufficient two-way communications

• Attitudes of employees, line managers and the top team

Developing a reward strategy

Developing a reward strategy 1 of 4• Organizational strategy

• HR strategy

• Reward strategy

Developing a reward strategy 2 of 4

• STRUCTURE AND CONTENT OF A REWARD STRATEGY

• Environmental analysis; macro and micro

• Gap analysis• A broad-brush approach • Specific initiatives


• MAJOR STRATEGIC REWARD DECISIONS

• What to pay employees• How to pay individual

employees• What benefits to offer• How to construct recognition

programs


• Phase One-diagnosis and specification

• Phase Two-design and stakeholder input

• Phase Three-test and validate in preparing for implementation

• Phase Four-implement, communicate and evaluate

Drill B

Job evaluation

Job evaluation

• A systematic process• Relative or absolute• Analytical or non-analytical• Market pricing

Recognition

Recognition 1 of 5

• Types of recognition• Why does it matter today?• Sustaining a culture of

recognition• The business case• Anticipated benefits• Program effectiveness• Measurable impact

Recognition 2 of 5

PROGRAMS• Adoption• Type• Standardization• Age• Delivery• Design and reality• Activities

Recognition 3 of 5

PROGRAMS (CONTINUED)• Ensure the program

delivers value to its employees

• Resolve the tension between manageability and measurability

• Evolve recognition so that it becomes a part of the culture

Recognition 4 of 5RECENT RESEARCH• It’s there but not enough

people know about it• HR fails to effectively

enable recognition• Highly effective programs

result in lower turnover• Many employees state they

are recognized annually or not at all

• Whilst many employees crave recognition specificity and ease these are not priorities for HR

Recognition 5 of 5RECENT RESEARCH (CONTINUED)• Senior leaders are not as

important to recognition as HR thinks

• Programs help create a recognition culture

• Failure to customize external programs or integrate software comes at a price

• Programs need to be refreshed frequently

Applying a reward and recognition program

Applying a reward and recognition program

• Create an award program for peer recognition of a job well done or for going above and beyond in their work

• Produce a monthly or quarterly newsletter

• Plan an annual firm-wide retreat

• Host employee outings• Recognize your employee’s

family including children and pets

The four Ps of reward

The four Ps of reward

• Pay• Praise• Promotion• Punishment

Trends in 2013

Trends in 2013 1 of 7NON TRADITIONAL REWARD PROGRAMS• Faster ramp-up cycles in

keeping events relevant• Use of hybrid and virtual

formats• Decision making pushed up

the change of command• “Above and beyond”

behaviours• Acknowledge performers

who are adaptable, collaborative and innovative

Trends in 2013 2 of 7BUDGETARY PESSIMISM• Global economic difficulties• “Discount fever”• Changes in vacation

choices• Cutting back on gifts but

increased usage of gift cards

• Are gift cards right for your organization?

Trends in 2013 3 of 7TECHNOLOGY• Faster broadband speeds• Cost-effective apps• Mobile access• Tablet applications• Social media

Trends in 2013 4 of 7GAMIFICATION• Incentives• Virtual currencies• Learning & development

Trends in 2013 5 of 7NON-CASH REWARDS• Meaningful and challenging

work• Trustworthy and

transparent performance management process

• Praise• Recognition

Trends in 2013 6 of 7WELLNESS• Exercise• Sleep• Diet• Alcohol and tobacco• Mental health

Trends in 2013 7 of 7CSR• Ethics and morals• Sustainability• “Green”• Climate change and carbon

footprint

Conclusion and questions

Conclusion and questions

SummaryVideosQuestions

Reward June 2013

Business

Transcript of Reward June 2013