There’s a war on talent making it difficult for businesses to attract and retain the right people. But paying more money is only part of the solution. We explain how Total Reward helps businesses appeal to the best people, encourages them to do their best work and makes them more likely to stay.
A 360° Approach to Employee Engagement
While people come to work for money, every employee also has a different set of motivators that employers need to meet.
What’s important to a single male nearing retirement is less likely to be significant to a forty-year-old mother. In turn, what motivates her will be unlikely to appeal to a fresh-faced graduate as the image below shows.
What this means for employers is that you need to consider more than pay when attracting and retaining talent.
One way to provide something for everyone is to implement a Total Reward strategy. As the name suggests, the approach should cover a variety of financial and non-financial rewards that are attractive to a range of employees.
Establishing market competitive pay rates helps to effectively position your business in the recruitment market.
Pay too little and you’ll tend to attract unsuitable candidates. Pay too much and you could overspend unnecessarily.
It’s also important to increase pay appropriately to ensure you keep hold of your best and brightest. One group particularly at risk of being poached are those early in their careers. As their skills quickly develop, they become increasingly employable and more attractive to competitors. Regular salary reviews with larger increases aligned to performance are the solution here.
Performance and Bonuses
For the money-motivated, bonuses provide an additional incentive to join or stay with a company. Some roles and sectors (like sales and financial services) will expect a bonus to be paid; for others it’s a nice, well, bonus.
If you choose to provide an annual bonus it should be related to both individuals and business performance. This will ensure you have sufficient funds to cover the cost of the bonus and will direct more money to your best people which will help retain them.
If compensation is the cake then benefits are the essential cherry on top. When your competitors provide lots of cherries - like private medical insurance, company cars, life cover and pension contributions – you need to compete.
As the image below shows, benefits can increase employees’ intention to stay and makes them far more likely to say good things about you, their employer.
Designing a benefits package that appeals to different employee groups is critical. This helpful article from the Society for Human Resource Management provides guidance.
Reward comes in many shapes and sizes and it’s not always money-related. Research from Capita Employee Benefits shows that being recognised by your line manager for a job well done is the second most important benefit after a pay rise.
Modern working practises, like flexible working schemes that provide job shares and allow people to work from home, are deemed to be more important than a pay rise by 34% of employees.
And even cost-free benefits like dress down days and early finishes on a Friday all contribute to making your business a better place to work. These are all advantages to reference at recruitment to give your business the edge in securing talent.
Learning and Development Attracts and Retains
Another way to attract and retain employees is to provide learning and development opportunities. Demonstrating a commitment to employee growth gives new hires confidence in your business. And high-quality development schemes can even set you apart as an employer of choice.
Promoting your training offering at recruitment is critical; in one survey, 40% of staff said their decision to join a company was heavily influenced by the amount of training on offer.
Personal development with clear career paths also helps to retain existing employees. Instead of looking for their next opportunity elsewhere, they can see their future clearly mapped out with you.
Don’t forget to integrate your compensation and benefits offering with development and career opportunities for added success; as employees become more skilled or progress into a new role, their remuneration should keep up.
Demonstrate the Value of Your Total Reward
Once you have a Total Reward strategy in place, you need to demonstrate its value. Some organisations create Total Reward Statements that calculate the value of an employee’s total package.
For example, someone being paid £30,000 has a much larger total reward package. A 7% pension contribution, 10% on-target bonus and medical insurance costing £700 per year gives an on-target compensation package of £35,800. Which is a much nicer figure to quote when your competitors are citing salary alone.
Total Reward offers a great way to attract, motivate and retain employees while building a strong employer brand. Think about what else you can offer to make you stand out from the competition.
For support with your recruitment needs, contact Tricia at Halecroft Recruitment on 0161 905 0526 / firstname.lastname@example.org
Becky Hewson is an ex-C&B Specialist turned Copywriter. She has provided professional C&B advice to HR Directors across a range of organisations from global entities to smaller family-owned firms.