How to create the right employee rewards programme
Because not every program suits every company.
Understanding the various types of programs that can be used and how best to utilize them is important for all businesses striving to retain their best employees. But many organisations struggle with putting together an employee value proposition that will differentiate them from the rest and allow them to secure the requisite skills to achieve their business objectives. More often than not, companies simply look for best practice in the market and apply it in the organisation which leads to a situation where many companies have similar or identical programmes, making it difficult to differentiate their employee value proposition.
There is a lack of understanding of the concepts of reward philosophy, reward strategy and reward policy. Reward philosophy speaks to the values of the organisation and will typically have a statement of intent of being fair and equitable in their reward practices, recognise and reward performance and provide development opportunities to employees. It drives the culture in the organisation and tends to remain static over a longer period of time.
Not every employee reward program fits every company. It's important to develop rewards which will be valued by your particular employee group and which also do not interfere with the company's day-to-day operations. For instance, some companies offer incentive travel as part of their reward programs. This might be suitable for a large company with many employees, but not a great idea for a small business that can not afford to lose key employees for too many days beyond their already earned vacation time. On the other hand, shopping based rewards are probably universally appealing to all size and categories of companies.
Reward policy governs the way employees are paid but the critical element in addressing the issue of attraction and retention of skills is the reward strategy, which has to consistent with the strategy and objectives of the overall business.