Recent Trends in Compensations Management
We saw some long-anticipated predictions materialize in 2018. We can expect to see these exciting transitions continue this year as we move into the Fourth Industrial Revolution, which has launched many deep and thoughtful conversations on thriving in a world that is rapidly becoming reliant on digital technology.
Today’s technology is enabling more and more professionals to change their mindsets about giving up full-time employment for contract-based opportunities that offer greater control over their time, growth, education, and job security. This trend is largely being driven by those with bulkier resumes and longer tenures especially in STEM (science, technology, engineering and mathematics) industries. The job market is filling up with new and exciting endeavours, but there are a limited number of qualified professionals to fill the need.
Managing contractors – who may only be around for 6-12 months – requires a creative and systematic approach to crafting fair pay and benefits arrangements that can attract, motivate, and protect them. Note that a majority of these employees will be in life stages where time for family and personal growth will take priority. But, the returns to reap can be vast and game-changing for your organization.
Engaging contingent workers can reduce overhead costs, especially for tax and infrastructure expenses. Their valuable experiences and insights can introduce much-needed diversity, dynamism, and agility to your business, and provide cost-effective learning and innovation initiatives. Moreover, they could become ambassadors for the culture and brand, which can boost your organization’s reputation and staffing objectives.
The concept of having greater flexibility in the workplace has been brewing for a long time, but the administrative demands for implementing custom arrangements was a minefield. Nowadays, however, with the world changing at a breakneck speed, organizations have to be ever more robust.
A mere ten years ago, digital spreadsheets and automated charts were all it took to enable pay strategies. Now there are powerful compensation software products to help perform this task. These can not only implement flexible arrangements but more importantly, integrate seamlessly between systems and process, thus enabling linkages between job levelling, market benchmarking, and compensation analytics. This gives compensation professionals increased opportunities to strategize further and determine timely solutions that could give more bang for buck, not to mention save countless hours of manual administration.
Many of the hybrid jobs that now exist weren’t even offered five to ten years ago. These roles will continue to evolve as we speed through the 21st century, which will call for an overhaul of the traditional compensation mindset.
Professionals have previously been content to take their salary and expect an across-the-board approach to pay increases and rewards. But as flexibility in the workplace becomes the norm, employees will also want their compensation and benefits packages to become more personalized.
Organizations will see analytics strongly recommending actions to maximize on human capital by adopting skills-based performance evaluation; customizing pay and benefits to address the employee’s life stage and personal needs; and creating alternative paths of career growth.
It will be worthwhile revisiting your Employee Value Proposition (EVP) and to consider creating customized rewards programmes for the top talent that are vital to your organization. Supplementing analytics with employee insights could steer your EVP towards a more meaningful goal for both the business and your workforce.
HEALTH AND WELLNESS
While rapid technological advancements of this era have helped to streamline systems and processes, they have also made the global marketplace even more competitive and demanding. According to our 2016 Staying@Work Survey, over 50% of employees say their jobs are a primary source of stress, especially in companies where there is less regard or prioritization of personal safety, health, and wellbeing. Numerous studies have linked workplace stress with various medical conditions, including cardiovascular disease, obesity, diabetes, hypertension, certain types of cancer, and mental health issues.
However, many employers still view health and wellness as an individual responsibility, preferring to stick with mostly hands-off approaches like providing medical insurance, sick leaves, and occasional off-site activities.
On the other hand, there is evidence that management-led health and wellness programmes, which are thoughtfully planned and coordinated, result in a happier and healthier workplace – with less distress, higher engagement and increased wellbeing. Productivity can be enhanced, and both hard and soft health care costs would decrease.” Successful health and productivity strategies have resulted in 6.5 fewer missed work days, twice higher engagement on the job, 25% fewer employees with hypertension, 24% fewer employees with high blood sugar levels, and 50% higher revenue per employee, among many other benefits.
PAY AND TRANSPARENCY
Base salary continues to be the number one driver of attraction and retention for employees in Asia Pacific. It is as crucial as ever to not only get your compensation
Right: But to ensure you are communicating openly and honestly to your workforce about pay. People now know that performance evaluation is a two-way street.