Scribd
Upload
11 views6 pages

Total REward Strategy

A total rewards strategy is a coordinated effort by an organization to develop a motivated workforce through a comprehensive rewards package that includes compensation, benefits, wellbeing, recognition, and development. This strategy aims to attract and retain talent, enhance employee satisfaction and engagement, and improve overall business performance. Creating an effective total rewards strategy involves assessing current offerings, gathering employee feedback, involving leadership, setting goals, aligning with organizational values, and ensuring balance and flexibility in rewards.

Uploaded by

richardmisomali.3
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
11 views6 pages

Total REward Strategy

A total rewards strategy is a coordinated effort by an organization to develop a motivated workforce through a comprehensive rewards package that includes compensation, benefits, wellbeing, recognition, and development. This strategy aims to attract and retain talent, enhance employee satisfaction and engagement, and improve overall business performance. Creating an effective total rewards strategy involves assessing current offerings, gathering employee feedback, involving leadership, setting goals, aligning with organizational values, and ensuring balance and flexibility in rewards.

Uploaded by

richardmisomali.3
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 6

What is a Total Rewards Strategy?

An effective total rewards strategy helps encourage employees to work more


productively, stay with the company for longer, and attract new talent. In
this article, we will review Maslow’s hierarchy of needs, how it corresponds to
a total rewards strategy, discuss the components of total rewards, and how
you can create a total rewards strategy for your organization.

What is a total rewards strategy?

A total rewards strategy is a coordinated effort driven by an organization’s


overall business strategy to develop a workforce motivated towards
excellence and growing with the organization through an effective and
inclusive rewards package. This package is a combination of all the benefits,
perks, incentives, guidelines, processes, programs, and other types of
rewards that an employer offers to its workers.

In a word, an effective total rewards strategy enables organizations to


improve business performance and achieve desired results through building
an engaged, satisfied workforce.

It is typically the HR department or a dedicated compensation & benefits


team that implements a total rewards strategy.

The five components of total rewards

 Compensation – This refers to pay (base and variable) that employers


provide to employees in exchange for skills applied, qualifications
earned, time given, efforts exerted, and targets met towards achieving
an organization’s mission and strategic objectives. Compensation
empowers employees to attend to their physiological needs like
purchasing food, clothing, and securing a home. This includes different
types of compensation, such as base pay, variable pay, stock options,
and cash bonuses.

 Benefits – These are packages provided to employees to enhance


their physical, emotional, and familial safety. The most basic types of
employee benefits are health, dental, and vision plans, leave plans, life
and disability insurance, and retirement plans.

 Wellbeing – Employee wellbeing has become more critical for


employers to attract and retain employees. More and more people
recognize the need for holistic wellbeing to be satisfied, healthy, and
motivated in life. As a result, employees are expecting organizational
cultures to promote employee wellbeing. Organizational cultures that
value and promote employee wellbeing may be characterized by:

1
o Employee assistance programs – These provide additional
assistance to employees who may be experiencing challenges in
their relationships, finances, or mental health.
o Employee resource groups – Such groups provide a social hub for
employees who share similar backgrounds or interests to form
friendships and professional networks within the organization.
o Diversity, Equity, Inclusion & Belonging (DEIB) programs – These
have blossomed over the past few years in many organizations
to review and address how equitable and inclusive organizations
are for diverse employee populations.
o Company-sponsored events – These events allow a cross-section
of employees to socialize together and sometimes with their
families (like a ‘Family Day’) to build friendships within and to
foster belonging to the organization.
o Opportunities to volunteer – Giving back to those in need also
contributes to employee wellbeing.
o Remote work and flexible work schedules – These are more in
demand due to the pandemic and increased recognition of the
importance of family. Such arrangements also provide a form of
safety for family life and relationships.

 Recognition – For some employees, compensation, benefits, and


wellbeing are insufficient to keep them motivated toward excellence in
performance and loyalty. People want their achievements to be
recognized. Recognition programs can take the form of:
o Awards – Spot awards, tenure awards, performance awards.
o Promotions – Ability to move up the corporate ladder to gain
more responsibility and visibility to leadership.
o Verbal appreciation in the presence of their peers or a simple
‘thank you’.

While all employees may not need these types of recognition, all
employees need respect in the workplace. Respect is a form of
recognition that all employees need to maintain a sense of
dignity and psychological safety in the workplace.

 Development – Employers who invest in employee development


programs are investing in the self-actualization of their employees. We
are all endowed with gifts and talents. Through education, training,
mentorship programs, and relevant work experience, these gifts and
talents equip employees to become more competent in their roles. In
other words, these career development initiatives enable employees to
advance within the organization to realize their full potential.

2
Why does your organization need a total rewards strategy?

There are some obvious reasons why organizations should have a strong
total rewards strategy. The following are some you should consider:

 Attracting top talent – A total rewards strategy that can potentially


satisfy all the employee needs will appeal to a broad demographic of

3
prospective employees. This helps an organization attract a diverse
candidate base and makes the recruitment of new workers faster.
 Employee satisfaction and employee engagement – There is a
strong potential for high employee satisfaction as employees evolve
and transition from one stage of life to another, yet still have their
needs met through an effective total rewards program. Also, when
employees feel they’re rewarded fairly, it also keeps them engaged.
 Employee retention – An effective total rewards strategy stimulates
employee wellbeing, engagement, motivation, all of which are key for
retaining employees.
 Competitiveness – A total rewards strategy makes organizations
more competitive within their industry by incentivizing excellence in
performance. And as we’ve mentioned above, the organization can
also successfully compete for talent and become the employer of
choice in their area of business.
 Improved business performance – When your organization can
attract and retain talented employees, it is likely to achieve the
organizational goals and outperform its peers. To put it another way,
engaged, high-performing employees often result in top-performing
companies.

How do you create a total rewards strategy?

1. Assess what you already have in place

When creating your total rewards strategy, you’re likely not starting from
scratch. You can conduct a rewards audit to find out where you currently
stand. What is your current compensation package like? What’s your
compensation philosophy? How are you doing with the other components of
total rewards? You may find that some components are stronger than others.

This evaluation will give you an idea of what you should prioritize and focus
on.

NEW Compensation & Benefits


Certificate Program Add Comp & Ben to your HR toolkit. Learn everything
from benchmarking salaries and job grading to sales compensation and pay
gap analyses.
Download Syllabus

2. Gather employee feedback

4
What do your employees think about your current rewards, and what are
they missing? You can do a survey or organize an employee focus group to
find out. Also, you can gather stay- and exit interview data related to
rewards.

Asking your employees what they would like to add to their rewards package
is an excellent way to understand your workforce’s preferences.

3. Include the leadership

Share the results of the audit and employee feedback with the organization
leadership. Explain the potential challenges of not having a strong total
rewards strategy, such as not being able to attract and retain talent. You will
need their buy-in and insight into organizational strategy and company
goals, but also gain their approval of your rewards budget.

4. Identify your goals and priorities

What do you want to achieve with your updated total rewards strategy? And
how does this support your specific business goals? Asking these and similar
questions will help you identify what to focus on in building your strategy.

For instance, you might have identified a problem with engagement across
your organization, which causes increased employee turnover. People are
not engaged, as they feel that their contributions aren’t recognized and
appreciated, and they end up leaving. Then, your total rewards strategy can
put an extra focus on the recognition element.

5. Align the strategy with your values and culture

Your total rewards strategy should be a reflection of your organizational


values and culture.

For example, at AIHR, one of our core values is “hunger to grow”. So in our
case, our total rewards strategy also puts emphasis on professional and
personal development opportunities.

6. Make total rewards balanced, flexible, inclusive, and fair

It is great if your total rewards strategy focuses extensively on recognition.


However, your employees need to pay their bills, too.

When creating your strategy, make sure that the elements are balanced.
Also, see what options there are to personalize and customize the rewards.

5
While some of your employees might appreciate paid gym membership,
others might value lunch allowance.

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy