WorldTalk
WORLDTALK
Towers Watson Research Survey Identifies
It’s Not Just about the Salary
As the annual compensation planning cycle begins, most employers’ thoughts turn to pay and performance management.
According to the 2014 General Industry Salary Budget Survey by global professional services company Towers Watson, Canadian employers are not differentiating pay based on individual performance as much as they could, and may be underestimating the importance of non-monetary aspects of the employment experience.
“Many organizations feel pressure to allocate more dollars to their compensation budgets or risk losing talent to other companies,” said Sandra McLellan, leader of Towers Watson’s Rewards, Talent and Communication practice in Toronto. “But we still see companies providing across-the-board increases. Does it make sense to give below-average performers an annual increase when it leaves less for your top performers? It’s time to think differently about how pay and bonus programs work together, and about how you can craft specific solutions for unique employee profiles.”
Organizations tend to forget that they can suffer a hit when they don’t understand (or don’t focus on) the things employees value beyond pay.
“Employers need to understand the full scope of what drives employees to join and stay with a company,” said McLellan. “According to our research, while employers recognize the importance of salary to employees, they are not placing enough importance on the entire employment deal which includes non-monetary aspects like career advancement, confidence in senior leadership, and job security – all top drivers of attraction and retention.”
According to the global workforce survey only 36% of Canadian employees believe that their organization provides opportunities for career advancement and 40% of Canadian employees feel they must join another organization to advance their career. Employee views of their leaders are not much better. Only 45% of Canadian workers agree that their leaders inspire them to give their best.
“For employees to remain with an organization, they must have confidence in the ability of their top leaders to motivate and guide them,” said McLellan, “yet organizations underestimate the role of senior leaders in helping to retain employees. And while companies cannot guarantee job security, they can focus on creating a stable work environment through leaders and managers setting clear expectations of business strategy, goals and results.”
Ultimately, as attraction and retention challenges loom for employers, developing an employment deal that’s tailored to different workforce segments, and that is effectively differentiated in terms of both pay and employee experience, will be crucial for finding and keeping talent – and for setting top employers apart from the competition.
10 | TRAINING MAGAZINE MIDDLE EAST NOV 2014