The future of employee reward? • Reward Value • Reward Strategy: getting started • Employee Reward: Why non-cash can beat cash • The New Reward Professional • Reward and organisational success • What is Reward Strategy? • Reward Management: Reward Strategy • Symbolic messages in Reward • But does it work in theory? • Seven themes for the future of reward • How to develop a Global Reward Strategy
The New Reward Professional
Being good with spreadsheets just doesn’t cut it anymore. I know that being an effective reward professional has always been more than that. But in the past, the reward people were the nerds of the HR world, who were comfortable with compa ratios and pivot table, regression analysis and quartiles, but you wouldn’t want a beer with them. So what’s changed? I believe that reward people now need to work in a different way and need new skills and behaviours. I suggest that there are now six aspects of reward management that are needed to deliver effective reward strategy. Some reflect points that I have already made in this chapter:
- Take a long-term perspective but with short term actions– this is a balancing act. Firstly, you need to know where you are going – the organizational strategy etc. Without that you have problems. And if it doesn’t exist then you need to set the agenda and map out the future. But we operate in the real world so you need to be flexible. Typically, you can only move in steps that are achievable. Of course at the same time internal and external events happen that will impact on what you are doing. The check is that you need to look at these things in the context of the direction of travel.
- Recognise holistic HR– whilst we need more specialists in HR, we also need to join up the dots. Reward professionals need to look outside their specialism to understand the links with other parts of HR. There is always a danger that you see a problem only within the terms of your specialism. But there is rarely a single solution, even if you can define the problem. Therefore, you must work with other specialists such as Learning and Development and Resourcing to maximize value.
- Use a consulting approach – to get a sensible solution you need to understand the context: the issues, attitudes, aims etc. So ask lots of questions. The best are simple questions. What is this for? Why do they do that? What is the real aim of this? Too quickly we slip into the solutions without understanding the context and trying to define the problem. A consulting approach does just that. A good example is designing a bonus plan. You never start at the design; you start by understanding the context and exactly what success looks like. The design may be fairly straightforward once these are clear.
- More emphasis on change management and less on reward design – whilst getting the design right is important, we do need to understand that a lot of what we do is as much art as science. There may be a number of reward solutions that can be effective; it will partly depend on the context of the organization within which the programme is meant to operate. But crucial – always – is the way in which it is communicated and implemented. We must take that into account in the design. So I am arguing that we need to shift the balance to more understanding of change management and communications than simply technical reward.
A vital element is knowing how best to manage stakeholders. You need to understand what is important to your key decision makers in particular and present the benefits to the organization not the features of the design. You need to know how to ‘sell’ best fit business focused solutions based on evidence to your leadership or you will fail.
- Meld the academic with the practical – we often need to challenge assumptions about the role of reward. So make sure you can use relevant academic research to support your argument. For example, Vroom’s expectancy theory (see Appendix) is very helpful in discussing bonuses. You must be selective in what you draw on for your audience; this isn’t about making you look smart, but helping the organization get the best solution. So read up on relevant motivation theories and don’t be afraid to use them. My experience is that, used sparingly, many managers can find them engaging and challenging.
- Manage external relationships – the world gets even more complex as it gets smaller. So even as specialists we are likely to need some external help and advice from time to time. Therefore, you need to understand how to manage external advisers to ensure your organization gets good value. Ensure you understand the fee structure, be very clear on the scope of the project. Divide it into discrete phases with clear deliverables. But also remember that you should stick to what you said you’d do. It only costs you money if you don’t.
An extract from Reward Management 2nd edition 2018