We all want to work in an environment where we feel we are truly making a difference. Where we feel supported and appreciated. We want to work with a leader who takes the time to develop and inspire us.
Creating such an environment will ensure that employees are committed and motivated to go that extra mile to contribute towards organisational success and better results. A successful environment will inevitably attract new talent, make existing employees feel rewarded and help retain your key people. Developing the right reward strategy will help you attract, retain and motivate the right people for your organisation. Whether you’re a local business or a global brand, you need a reward strategy that reflects the culture of your organisation and will enable you to achieve your organisational strategy and objectives. Extensive research in the industry has shown that having a defined reward strategy will help organisations attain better financial results than those organisations that choose not to have one.
So what should a reward strategy cover? Organisations can get just as much, if not more, out of non-financial rewards as from financial ones. Therefore, a reward strategy means more than just finding out what the market is paying. A total reward approach looks at what your organisation is trying to achieve, what your people want, what is affordable and the structures needed in place to achieve this. The four areas covered are:
- Cash compensation
Every organisation must pay its employees for the services that they provide (i.e. time, effort and skills). This includes both fixed (salary and allowances) and variable (bonus and incentives) pay. The cash compensation provided to employees increases over time and can be linked to a number of different factors such as performance or career development.
Organisations use benefits to supplement the cash compensation they provide to employees. These vary depending on the size of the organisation and affordability but can provide security and comfort to the employees and their families. The benefits include holidays, medical cover, income protection and pension schemes.
- Personal Growth
Providing personal and professional growth opportunities to employees is an essential part of any reward strategy. These can be skills acquired on the job as well as formal training programmes valued by the employees that also serve the organisations strategic needs. Alongside this development, however, is the need to manage expectations, assessing performance and constantly striving to improve.
- Work Environment
A positive work environment can often be the defining factor in retaining key talent in an increasingly competitive market. Ultimately, we all want to work in an environment where there is genuine feeling of team spirit and togetherness. With a leader that inspires and supports us to achieve success at both work and home.