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Think globally and act locally when designing total rewards to attract great talent, said consultant and thought leader John Rubino during a concurrent session June 22 at the Society for Human Resource Management 2016 Annual Conference & Exposition in Washington, D.C.
"Make sure that key employees are rewarded uniquely; personalize or perish," said the founder and president of Rubino Consulting Services, based in Pound Ridge, N.Y. According to Rubino, global HR professionals must resist the temptation to focus too much time and energy on managing and monitoring low performers to the exclusion of higher-performing workers. And because the modern workforce doesn't exhibit the same loyalty employers could expect in decades past, companies must respond with compelling and personalized incentives to encourage retention.
The Soft Stuff Matters
Not all benefits are tangible or have a monetary value, Rubino said. Intangible benefits can have a significant impact on workplace culture and can ultimately create higher levels of employee engagement.
Rubino explained that "the younger workforce wants to work somewhere where the corporate values match their personal values." He pointed to numerous studies showing that young and emerging professionals prefer flexibility or other intangibles to higher pay. Deciding what types of workplace programs will be most effective for your company means understanding demographics at the macro and micro levels.
"Total rewards have to be relevant," Rubino said. "And to determine relevance, you must understand the broader context in which your company operates." In a country with a high median age, for example, retirement benefits will likely matter more to your workforce than some other benefits.
Variability Is the New Constant
In Rubino's view, the typical pay-for-performance system at many companies is flawed and doesn't promote better performance as intended. He suggested putting more emphasis on variable pay tied to measurable objectives. "There is no merit in merit increases," he said.
When making a shift away from high levels of fixed base salaries, it's again important to promote a global philosophy while maintaining sensitivity to cultural nuances. For example, Rubino referred to the tendency in Asian countries to determine variable pay as a function of team performance, reflecting the regional emphasis on collectivism. This is a marked departure from how variable pay should be structured in an American company, where there typically is a significantly higher individualist orientation.
Managed Communication Is a Must
"[Total rewards] communication is a strategic exercise that needs to follow a specific methodology," Rubino advised. After all, benefits can't help motivate or retain employees who aren't aware of them. Communication is another arena that requires local consideration.
He illustrated his point with an anecdote about a U.S. software company that wanted to implement same-sex domestic partner benefits for its entire global workforce. In the minds of the U.S. executives, this decision communicated a clear message that the company supported employees and celebrated diversity. They failed to realize, however, that this benefit and message would not resonate with their employees in the Middle East, where social values are different and same-sex relationships are often illegal.
Rubino's parting advice for HR professionals was to bear in mind the new informal employment contract taking shape the world over. In this modern and unwritten contract, "The employer provides total rewards valued by their employees and in return the employees provide time, talent, effort and results." When this contract fails on either side, he warned, it leads to attrition.
Amy Gulati, SHRM-SCP, is a freelance writer based in the Washington, D.C., area.
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