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Total Rewards Aren’t Total Without Factoring In the EX

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Aug 15, 2019

The prospect of becoming irrelevant and marginalized in the digital age is increasingly incentivizing organizations to look for ways to attract and retain workers who can enhance their competitiveness with a synergistic infusion of technology. However, gone are the days when professionals depended upon the paternalistic instincts of their employers to provide them a career path and fair remuneration. Today’s professional is more informed and better skilled and possesses the knowledge to successfully negotiate terms of employment.

The era of employee loyalty has been over for quite a while now, however, the concept of “Employee Partnership” that was built on the ashes of organizational allegiance is also under threat. The new arrangement seems to be one of “Employee Gratification,” where attractive Total Rewards are customized to serve as golden handcuffs as long as the organization sees a healthy ROI in terms of retaining them as part of its workforce.

The accepted wisdom in the professional circles has been to innovate within compensation and benefits under the guise of total rewards, however, that is not enough anymore, as employees seek experiential gratification peppered with organizational goodness for a robust employment relationship. To put it bluntly, if the employees regularly find themselves weighing whether their comp and benefits are worth the crap they take every day, then the organization has failed handsomely in its Total Rewards strategy.

In this digital age, any total rewards package that does not reinforce employee engagement and wellbeing is a recipe for profound talent attrition. Therefore, organizations that can provide the strongest anchors for their employees will be the ones with a healthy pool of the right kind of talent for effectively overcoming challenges now and in the future. This becomes critically important for identifying future leaders with robust talent pipelines by avoiding the unfortunate loss of talent through intentional and unintentional filtering and other barriers.

Consequently, such a realization has propelled the employee experience into the limelight.

Use this brief checklist as a guide for assessing your employee experience initiatives:

  • Do you have a formal Employee Experience program as part of the Total Rewards package?
  • Do you link the employee experience program with the core values of the organization?
  • Do you audit/review the effectiveness of the formal employee experience program at defined intervals for refinement and improvement purposes?
  • Do you include employee experience as a critical part of the performance appraisal of supervisors?
  • Do you get regular feedback of the employee experience during the exit interviews?
  • Do you use employee experience as a recruiting tool, especially, by leveraging former employees?
  • Do you benchmark your employee experience program with prominent organizations in the same and/or other industries?

Detailed analysis can be done by formulating insightful questions under the following headings:

Total rewards packages that lag in the employee experience and which hover around the industry norm often relegate organizations to mediocrity in terms of functional agility, talent relevancy, and competitiveness, while trying to meet the challenges of the digital age. Therefore, it is imperative that an organization consistently provides an enriching employee experience.

An employee experience formula

Here’s is a way to express this as an equation: IEE = FP + UE + PS. Let’s explore the meaning of these terms with examples of what the employee might expect or desire of the employer:

FP = Formal Promises (contractual obligations) — Honoring the agreed remuneration; adhering to the core values; providing necessary training and development; provision of stated workplace amenities; impartial resolution of conflicts; protection against bullying, etc.

UE = Unstated Expectations (psychological contracts) — Will not be mistreated, especially, in front of peers; will be given ample chances to prove myself with high-profile assignments; will be paired with an effective mentor; will not be discriminated in terms of pay packages; will have adequate access facilities for employees with disabilities; will be offered re-skilling opportunities, rather than being surprised by downsizing; will not be ostracized for internal whistle-blowing, etc.

PS = Pleasant Surprises (delight factors) — Enabling the fulfillment of a bucket list item; throwing a birthday party; arranging baby showers; providing a complimentary childcare facility near the office; creating a “vent room” for managing stress; complimentary learning of hobby-based skills; paid time-off for volunteering; entrepreneurial opportunities that complements the organization (Amazon encouraging employees to start their own delivery businesses by giving them money and training), etc.

IEE = Invigorating Employee Experience

The importance of optimizing this equation is underscored by the fact that today’s multigenerational workforce is looking at existential challenges more pronounced and transformative than for earlier professionals. These are even more pronounced as artificial intelligence makes ever quicker inroads into the workplace, relentlessly upping the threshold for worker relevance.

A receptive organizational culture, buoyed by cohesive core values and complemented by astute talent management strategies and bolstered by an enlightened leadership, is necessary to the successful implementation of the formula for an Invigorating Employee Experience. One of the key success factors is to give ample time for resolving “Sadness at Work” issues before embarking upon “Happiness at Work” initiatives to avoid cynicism and passive resistance by wary employees.

Additionally, the significance of pairing capable mentors with blossoming talent cannot be overstated as it lays the groundwork for keeping potential successors focused and galvanized towards maximizing their value-add for the organization while carving admirable careers for themselves. However, few organizations invest in formally engaging such relationships.

Total Rewards, infused with an invigorating employee experience, is a powerful antidote for the stress and anxiety faced by the workers as they strive to keep up with the demands of the digital age. Excelling in the respective context is increasingly becoming a competitive strength for progressive organizations as they break away from the flock of merely good employers and join the exclusive club of outstanding employers. Are you ready and willing for such a migration?