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COMMUNICATING TOTAL REWARDS3 Keys to Building Engagement & Retention

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TalentTakeawayswebinar & podcast series

Talent Takeaways Series

AGENDAAGENDAThe Sponsor

Talent Takeaways Series

Talent ManagementMade for Managers

Compensation Planning Total Rewards Stay Interviews

Communicating Total Rewards3 Keys to Building Engagement and Retention

Zachary WeinbergerManaging ConsultantRemuneration Resources, LLCwww.RemunerationResources.com

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What We’ll Cover Today

The true impact of rewards communication

1. Balancing theory and practice2. Applying a transparent model to communicate

total employment value3. Understanding your audience and using

technology to communicate total rewards

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How good are we at communicating rewards?

Towers Watson’s 2014 Global Workforce and Global Talent Management and Rewards study shows only half (52%) of employees feel their company does a good job of explaining pay programs

29% of respondents in a 2007 WorldatWork survey said that pay communication is the component of their company’s rewards program most in need of improvement

53% of respondents in Payscale’s 2014 compensation survey felt their organization does not offer managers training to teach them how to talk to employees about compensation

Incentive plans are intended to drive behavior yet only 31% of HR managers believe employees understand how plans operate

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The SolutionMake it simple

Explain why; not only what, when and how• When they understand the rational, people assimilate information better

Share more information rather than less• Nature abhors a vacuum – the less information employees have the more

they invent (rumor, gossip, etc.)• The more information they have (up to a point) the better they understand

and accept the information

Use multiple approaches• Not all audiences need the same information• Not all people absorb information the same way

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OBJECTIVE OF COMMUNICATIONS PROGRAMS

Tactical:• AWARENESS: Improve awareness of the different elements of the

total compensation program • UNDERSTANDING: Provide clarity around the total compensation

program• APPRECIATION: Communicate the collective mix and relationship

of various pay elementsStrategic:• ENGAGEMENT: Employees are loyal and productive• RETENTION: Employees stay with the company

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In ShortThe goal of a rewards program communication plan is:For your employees (present and future) to see their rewards package as the tremendous offering that it truly is, they need to understand it. This starts with grasping your company’s compensation philosophy, your base pay system, your bonus programs, and the role your culture plays in promoting and supporting career growth.

If your rewards communications connect the dots between their benefits, pay, performance, and career development employees will be increasingly engaged and loyal.

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1. Theory and PracticeTheory: a contemplative and rational type of abstract or generalizing thinking, or the results of such thinking. A theory provides an explanatory framework for some observation.

• The rationale…• Why we do it …• How to think about it …

Practice: the actual application or use of an idea, belief, or method as opposed to theories about such application or use

• How to do it ….• What we do …• The processes we use …• How to pick a starting salary• How to process a merit increase• How the bonus plan works

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What are we communicating?Rewards philosophyRewards program objectivesRewards process• Mechanics• Base pay plans• Plan changes• Incentive plans• Benefit plans• Benefits plan changes• Total rewards statements• Mobility programs• Etc. 11

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How Much Theory10% to 80% theory • 10% - general , broad based employee communication• 80% - HR compensation training

Philosophy underlies theory

Theory is why the process is what it is and the rational for decision making • Can be strategic or tactical

Practice is the process or processes we follow• Can be tactical or operational 12

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2 TransparencyTransparency: as used in science, engineering, business, the humanities and in other social contexts, implies openness, communication, and accountability. Transparency is operating in such a way that it is easy for others to see what actions are performed. It has been defined simply as "the perceived quality of intentionally shared information from a sender". (1)

The level of transparency depends on the compensation philosophy and culture of the organization• Trend is to greater transparency• With transparency employees get accurate information rather than false rumors• Greater transparency builds trust in the organization which leads to greater

engagement

(1)Schnackenberg, Andrew K.; Tomlinson, Edward C. (March 2014). "Organizational transparency: a new perspective on managing trust in organization-stakeholder relationships". Journal of Management

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How Transparent are we?39% - No salary range information22% - Limited salary range info (employee’s range)8% - Limited information (employee range and next range up)18% - Some other approach13% - Transparent

Pearl Meyer – Published in WorkSpan 2/13

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How Transparent Should We Be?As transparent as possible

To increase transparency, we must actively include greater disclosure, clarity, and accuracy in our communications

Do not loose simplicity and clarity - too much information does not increase transparency

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3 Who is the Audience?Senior Leadership – need to understand and endorse rewards plans and programs

Executives – need to understand and approve rewards plans and communication programs

Human Resources - need additional training and information to help answer manager questions

Managers – need additional training and information to help answer employee questions, in addition to understanding the information as it applies to them

Employees – need to understand rewards plans and programs

Employee Families – need to understand impact on them

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Communication Channels Face to face meetingsPrint• Presentation Decks• Brochures• Post cards

Direct mailEmailPortals – will it also work on a smartphone?Social mediaOnline modelingOther…

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Making the Message StickClassical forms of communicating include:• Ethos – credibility of message (messenger)• Pathos – emotional appeal• Logos – rationale

Identify key messages • While balancing theory with practice: be focused • Be clear and simple

Be Relevant • explain why the message is important to the audience

- answer “what’s in it for me?”

Start at hire and continue throughout the employee life cycle• Annually• Quarterly• As needed

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Measure SuccessIs content accurate and understandable?

Is content being delivered?• Are communications sessions taking place?• Are employees receiving print and electronic communications?

Do HR and line managers feel they can answer employee questions? – survey them

Was the merit process completed timely and with few complaints?

Did employees sign up in the proportion desired?Was the reaction as expected?

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Overall SummaryPhilosophy guides Strategy

Strategy guides Communication (tactics)

Simplify the message (simple design helps)

Provide as much information as organizational culture will allow

Prepare HR and Managers more ( they need to answer employee questions);

Gear communications to various audiences • Differentiate by audience• Be inclusive

Communicate early and often via multiple channels and in balance with other HR and company communications

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Thanks!

Zachary WeinbergerManaging ConsultantRemuneration Resources, LLCzweinberger@remunerationresources.comwww.RemunerationResources.com+1 (203) 561-7315

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