How familiar does this sound to you? Managers are telling you they can’t recruit within the current pay ranges and need to pay more. Roles are frequently being requested for re-evaluation to access higher pay ranges. You’re having to create pay ‘fudges’ to accommodate staff who threaten to leave or to bring in the ‘best’ candidates. You’ve started to look into your gender pay gap and identified several examples of similar roles being paid very differently. Your employee engagement survey tells you staff don’t feel fairly paid.
Many reward professionals are so consumed in the day to day activities that often these signs become an acceptable part of the norm. But there comes a point when the noise becomes too much of a distraction. Embarking on a reward project can be daunting. It may unsettle staff and require time and investment to manage. Many companies stop here because they don’t have the resources or appetite to upset the applecart. But can your organisation really afford to continue the status quo in the long term? Based on our experience, there are seven logical steps to embarking on a reward project:
- Provide a compelling story. Creating a clear rationale will help to break down the noise. What do employees really want? What is their perspective on how reward is managed? What makes your organisation different and how can you use reward to leverage this? Conducting focus groups can be a really powerful way to gain insights that help underpin your reason for change.
- Look at the numbers. Looking at what the numbers are telling you can help solidify the business case. How many roles are you paying outside your pay structure and are you getting value for money from these people - are they your best performers or just smart negotiators? How much are you spending outside of pay review? We know that typical spend can be double your pay review budget, you just can’t see you’re spending it. Are you paying competitively compared to the market?
- Get the project on the corporate plan. Demonstrating how the project aligns to and underpins the corporate strategy will ensure that it stays high on the board agenda. If there are KPIs attached to the outcomes, there will be pressure for the whole exec team to ensure delivery is achieved. Make sure it stays on the agenda too by providing regular updates so progress can be tracked.
- Identify clear timelines with a definitive end date. If there is no clear deadline to achieve the project by, you may find it becomes less of a priority and people will get bored of hearing about something that never moves forward. If you commit to achieving the project by an agreed date, you will find it’s easier to maintain momentum.
- Allocate dedicated internal resource to see it through. If it becomes an add on to the day job, the danger is that you just get pulled into other matters and you can lose focus. By making the project a measurable objective and agreeing a dedicated resource who can drive the project internally, you stand a much better chance of maintaining traction.
- Bring in experts when you need them. Don’t be scared to bring in external resource to help you manage the parts you don’t quite know how to do. As reward consultants, we manage several reward transformations a year - most HR or reward professionals working internally may do just one in their career.
- Make it sticky. Get the whole organisation on board through a clear and involving stakeholder plan. If the project is an initiative done by HR for HR’s sake, it won’t generate traction in the business and the desire expressed for change will wain as something else becomes priority. The best reward transformations happen with staff and managers involved from the start. Set up internal project teams that leverage internal expertise (whether its legal or finance or IT) as well as creating ambassadors or champions who can provide input as well as help to spread the word.
I’ve seen all too frequently that while the numbers stack up and employees are pressing for change, unless the senior leadership team are prepared to make difficult decisions and stand by them, your reward project will never quite get off the ground. I hope these steps will help you gain traction and take control in your reward project.
For help with any aspect of pay and reward, get in touch: 020 3457 0894.
