Gone are the days when employees focus more on monetary benefits than work-life balance. With these changing times, individuals are seeking more flexible work environments, better growth opportunities, appreciation for their efforts, meaning in their work, a sense of belongingness, and much more.
As a result, many organizations are restructuring their total reward package as per the needs and preferences of employees. Offering flexible rewards to employees according to their contribution is becoming more prevalent in companies. Employee reward programs are reshaping the employee experience and encourage them to deliver stellar performance.
What do we mean by Employee Experience?
Employee experience means how employees feel working in an organization and about the various organizational factors like leadership, trust, communication, growth opportunities, training programs, camaraderie among coworkers, tools, resources, and recognition programs.
Employees are the driving force who work relentlessly to ensure organizational success by delivering incredible results.
According to the Society of Human Resource Management (SHRM), positive employee experience involves the total reformation of traditional workplace practices. It focuses on keeping employees at the forefront and ensuring the happiness of the employees.
Why to focus on Employee Experience?
Employers opt for creative and innovative ways to hire, motivate, and retain top talent in today’s competitive age. It is imperative to provide employees with an exceptional experience to stay happy and committed to their work.
An MIT research shows that improving employee experience can increase the profitability by 25 percent. Thus, companies should focus on enhancing employee experience for phenomenal results.
As per the recent study, around 80 percent of the executives rated employee experience as crucial, but only 22 percent said that their companies were successful in ensuring an excellent employee experience.
So, how can you foster a differentiated employee experience in the organization? Ideally, the HR should know about the total people cost reporting to count the total cost of the workforce, and help strategize.
One of the ways through which a company can create a positive employee experience is by introducing total rewards strategy.
Employers reward employees in a total reward strategy who accomplish business objectives through compensation, benefits, and personal growth opportunities. A total reward package aims at offering a holistic employee experience because it comprises components that drive employee satisfaction, engagement, well-being, and alignment. As a result of which, organizations enjoy better financial success because total rewards encourage high-performing employees to stay productive.
How Total Rewards improve Employee Experience?
A compelling total reward package plays a prominent role in attracting the right candidates to join the company and remain for a long time there. To reshape employee experience, organizations design the total rewards package consisting of monetary and non-monetary rewards to cater to the employees’ expectations.
During the recruitment phase, prospective employees try to have a better insight about your company via popular websites like Glassdoor.
The onboarding stage is another influential touchpoint in the employee experience. When candidates accept the job offer and join the organization, they go through the onboarding process. In this process, HR guides new joiners about their compensation, benefits, and other non-monetary awards to create a fascinating experience.
Monetary rewards refer to any form of monetary payment given to an employee in return for an employee’s contribution, expertise, and time. Employees can calculate the overall financial value of monetary rewards and compare it to other companies. Some focal components of monetary rewards include:
This refers to a basic salary or wage offered to an employee. They can compare their base pay with what other employers are offering them for doing similar work. This component helps them determine whether they are being paid according to their expertise or not.
Employees get compensation based on their performance from the individual, team or organizational contributions. The elements of variable pay include merit pay, bonuses, incentives, sales commissions, and profit sharing. The variable pay varies as per the individual’s performance. It encourages employees to improve their performance and motivate them to work on the shortcomings.
Employees receive benefits, such as health insurance, paid time off, life insurance, pension, employee assistance programs, wellness programs as indirect monetary rewards.
Non-monetary awards are intangible rewards as employees can’t assess their financial value. These rewards are designed to value the individualistic needs of employees and the emotional well-being.
The crucial components of non-monetary rewards include:
Career opportunities: Employees want growth in their careers, so they would love to work in a company that provides them with growth opportunities. Employers can help their employees by designing training programs and defining career goals for them.
Flexible Work Schedules: Many companies have understood the importance of flexible work culture during COVID-19. That’s why they allow their employees to work remotely to focus on their personal lives and take health as the foremost priority.
Overall, it’s clear to see that Total Reward Packages have an instrumental role in motivating employees to work better and retaining the top talent. Don’t hesitate!