Attracting and retaining top talent is a difficult courtship for many organisations, often because reward strategies are devised using a one-dimensional structure, ignoring the way people achieve success and the way they want to be rewarded for their achievement. The top-performing individuals that businesses want to attract and hold are motivated by many things, not just financial reward.
Hay Group studies have shown people who work for the world’s most-admired companies (recognised by Fortune and Hay Group) are paid about 5 per cent less than the market average.
Work is shifting towards collaborative, interdependent teams, and success is rarely achieved by one individual. The high achievers succeed in building productive and energising networks, find solutions by working collaboratively across silos and drive others to reach their potential.
For people who create impact using softer skills, the value proposition of a role and the company is found in the intangibles: the broader business strategy; the organisation’s culture; how team performance is regarded; what success looks like and how they can contribute to that success.
While a pay rise or healthy bonus communicates a strong message about an employee’s value, most people with these skills want to add value and be rewarded holistically.
The trouble is that new recruits often don’t get a true picture of what an organisation is like to work for because its true value proposition may not be clearly presented to candidates. The business culture, the brand, team structures, plus things harder to sell — such as the complexity, the degree of commitment expected or the internal processes that may frustrate newcomers — can be miscommunicated during interviews.
Organisations with very clear and consistent value propositions have a defined employer brand and are likely to hire people who align themselves with what the organisation offers.
The business world is rapidly changing; transformation is the new norm. Technology is disrupting the business status quo; the barriers for entry are lowering, allowing more nimble, smarter companies to compete; and the lab¬our force is in a state of flux. It’s understandable to want to hold on to the old way of doing things when the map of reality is being completely redrawn.
But the reward strategy must change. How can an organisation transform itself if the way it motivates and encourages performance and behaviour stays the same?
We need to discover how to measure success and reward hard and effective work in a holistic way, without relying on fixed, one-dimensional targets, such as reaching sales targets. Reward needs to be flexible and attractive, not just to workers climbing the career ladder but also those shifting sideways as organisations transform.
The best reward structures look to measure the long-term value an individual brings: the business development manager who reshapes a sales strategy or opens up new markets; the manager who changes behaviour from the top down; or the consultant who creates a high-performing team around them.
Achievement is rewarded not only by financial and traditional non-financial benefits but also by the individual getting satisfaction from making a difference, adding value.
Trevor Warden – The Hay Group