A comprehensive meeting summary, along with all slides and presentations is available to EN Global Total Rewards members only. Don’t forget to fill out the form at the end to learn more.
Looking Past COVID-19 and Planning for 2021 in Total Rewards
As we near the end of the year, one thing is certain, Total Rewards leaders have a lot on their plates. Our 2020 Autumn GTRN virtual network meeting brought together 23 global Total Rewards leaders to discuss how they are managing the COVID-19 response while maintaining focus on the future. Companies included Bank of New York Mellon, BP, Cargill, Cofra Holding, Colfax, Danaher, DHL Express, Dow, GE, Grundfos, Henkel, JT International, Mastercard, MetLife, Neste, Pentair, RELX, Royal Dutch Shell, Sun Life, Synchrony Financial, Tapestry, Unilever, and Wolters Kluwer.
Stretch Thinking Session: Distinguishing Value from Performance in the Design of Total Rewards Haig Nalbantian, Senior Partner, Mercer
For years professional athletes’ performance has been measured based on raw data. However, many sports have begun utilizing data analytics to gain insights into athletes’ true ability and revealing their adaptation and resilience to poor conditions.
Haig Nalbantian challenged Total Rewards leaders to think about performance in a new way, measuring employees’ relative performance by taking into consideration the situational factors that may affect an individual or team’s ability to perform, both positively and negatively. Haig believes by filtering out the elements that have very little to do with a person’s skills, employees will be incentivized to perform no matter the situational factors.
This new way of measuring performance brings to light many interesting insights including implications for Diversity, Equity and Inclusion. In one case study an organization found that women and people of color were much less likely to be promoted or given a raise. The pathway to success was invalidated by situational factors of where people sit. Looking at raw performance alone it seemed as though those employees were not performing as well as others. However, when they removed the situational factors using statistical models, they ended up with a completely different composition of who was the top, middle, and underperforming employees in their organization.
According to Haig, the critical steps towards understanding and quantifying the true contribution of individual employees or teams are the following:
- Identify and select individual and group performance measures routinely tracked by your organization.
- Identify external or “situational” factors that systematically influence these performance outcomes.
- Adjust those measures through statistical modeling.
Haig emphasized that although the models are not perfect, the goal is to identify meaningful insights that will help leaders make better decisions. With recent advances in analytics, organizations are sitting on remarkable amounts of data that tell the story of their workforce. As rewards leaders you have the opportunity to use that data to create better, more reliable, and stable measures of the true value of your employees.
Member-Led Discussion Takeaways
The Peer2Peer session of the meeting gave members a chance to share and offer advice on current challenges and pressing issues they are facing in their organizations. Identified challenges are reflected in the word cloud to the right.
Here are some of the takeaways from the discussion:
- Measuring relative performance is an interesting idea but proves a difficult challenge to actually systematize and implement into ongoing processes.
- Despite the importance of ensuring employees fully understand their benefits, few participating organizations have a dedicated resource for rewards communication.
- Organizations are beginning to move away from a compliance focus to a more integrated and sustainable approach to pay equity. Pay equity is an important part of the overall Employee Experience leaders want to create.
- ESG and how to integrate it into incentive plans is becoming a very important factor for shareholders and other stakeholders.
- Many leaders struggle with how to measure the effectiveness of their total rewards strategies.
- Data is an important factor in the TR strategy, but you will never have all of the data you need. You must start with what you have and build upon it, rather than waiting to find the information you think you need.
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