ASSIGNMENT #1 TOTAL REWARDS

Describe each of the top five (5) advantages of a total rewards approach. According to the book, WorldatWork, (2007) total rewards are the monetary and nonmonetary return provided to employees in exchange for their time, talents, efforts, and results. It has five key elements; compensation, benefits, work-life, performance and recognition, and development and career opportunities that attract, motivate, and retain the talent required to achieve results. The need for a total rewards approach is getting stronger everyday and has many advantages for the employee and company. The top five advantages of a total rewards approach are increased flexibility, improved recruitment and retention, reduced labor costs/cost of turnover, heightened visibility in a tight labor market, and enhanced profitability. Increased flexibility allows employers to create different blends of rewards packages for different workforce segments. The rewards programs are now able to be mixed and remixed to meet different needs of the employees. In this era the employees must integrate their life style and their work and the flexibility through the program allows them to determine when they work, where they work, and how they work. Improved recruitment and retention is a reward strategy used to handle the issues created by recruitment and retention. Normally, money is used as the solution but since it raises the company costs instantly they developed a deal that addresses a broad range of issues and spending rewards dollars where they will be most effective. The Reduced Labor Costs/Cost of Turnovers may sometimes invisible but it’s definitely not cheap. It may cost up to 30% of an hourly employees salary to replace them. (WordatWork, pg. 16, 2007) There are indirect costs as well, such as loses from customers and sales, as well as decreased efficiencies as productive employees leave. Heightened Visibility in a Tight Labor Market basically means talent shortages have become a major problem for companies. And the labor market is only going to get tighter. As a result, organizations are realizing that every employee matters even more when there are not enough to fill available jobs. Especially with demographic shifts and new economic forces, if the employee can find an environment that’s more in sync with their needs, they will make changes for that. Enhanced profitability focuses on the allocation of funds in a total rewards approach. Most organizations look at a comprehensive total rewards approach as an increased cost instead of an investment that may yield a significant return in the end. A total reward approach is more than healthcare costs and set pay scales especially when looking at the workforce overall. There is a high level of diversity in organizations that should be considered when implementing a total rewards approach. There are age, culture and gender differences that require a diverse approach when being rewarding or when defining work life balance. It is important for an organization to capitalize on the diversity in the workforce and its return on investment. Describe five (5) common ways a total rewards strategy can go astray. The development of a total rewards program can be very difficult and time consuming. Organizations must look at past and current practices while taking inventory of every program, looking at the rank, to determine the effectiveness of each program, and determine the link, by mapping how the rewards complement of help drive the specifics of the strategy. However, once complete there are several ways that a total rewards strategy can go astray. Trying to re-engineer programs in pieces; An organization needs to review all programs and make changes to the entire program not just pieces of it over time. The total rewards strategy focuses on re-engineering the program in its entirety in a specified time frame. The purpose of the total rewards approach is to ensure that all the programs are working together for the overall success of the business. Trying to implement changes all at once; Organizations must not try to change the entire program at one time. While it is necessary to change the entire program, it is important to set a timeline to implement the changes and communicate the changes across the organization accordingly. Change is inevitably one of the hardest concepts an organization can implement so when people are faced with too much change at once they may resist the need to absorb it and adapt to it. It is more effective to enact new programs and changes over time than all at once. This gives employees time to understand the new program and managers can gauge if the process is working. Limiting the number of people involved; Establishing a limited amount of involvement can be disastrous. It is imperative that organization have a vast number of key stakeholders that represent all aspects of the organization involved in the total rewards approach. Each stakeholder can provide input that is necessary to gain understanding of the needs within the organization and how the new programs will impact the organization and its goals/objectives. Not doing a through impact analysis; Organizations fail to set up an analysis that measure the impact that the total rewards approach will have currently and in the future. The analysis should look at the impact on the organizations financial state, internal and external customers and organizational mission and goals. If one part of the total rewards strategy fails, then there has to be an account of how it affected other areas of the organization now and what will need to be done to minimize the impact later in the future. It is like the old saying, you don’t know where you are going unless you know where are came from. That is true when measuring impact analysis, organizations need an account of how these changes has affected them since implementation and do a forecast for the future. Not communicating effectively; Communication is a key component inside any company. A total rewards strategy will not be effective if the communication is not effective. Organizations have to ensure that changes are communicated out in a timely and efficient manner. There will be little to no success with the strategy is there is too little or too much communication. It is important to define what messages need to be communicated to the organization, the delivery timeline and the most effective method to communicate. Describe the six (6) steps in designing a total rewards program. The six steps to designing a total rewards program area analyze and assess, design, develop, implement, communicate, and evaluate and revise. The first activity involved in developing a total rewards program is to analyze the company to get a clear understanding of organizations current practices and values. The assessment forces the organization to think about what is and what should be. The assessment requires the effective collection, organization, and analysis of data. The design process starts with the corporate mission, vision, business strategy, HR philosophy and strategy, and the total reward philosophy statement. Once the mission, vision, and business strategy are designed the HR philosophy and strategy will flow along. Developing a program is both a science and an art. The key is to have a basic process and adjust it to the organization along the way. The basic design involves the determination of purpose and objectives of the program, eligibility of individual participants in specific aspects of the program, baseline for measurement and goals, funding of program initiatives, plan selection and structure, and course of action and timeline. Then you must implement the process which is where the action takes place. Now is the time to put the program to the test and form an implementation team and conduct a pilot test. Next, we must effectively communicate the developed program. Employees sometimes don’t understand the many aspects of HR so they have to be sure that program is explained thoroughly to management and the employees. Finally, we evaluate and revise because no program is complete until we find out if it works. No program will fully satisfy the needs of every one employee so therefore you must measure the success on the ability to recruit, retain, and reward top performers. Describe the eight (8) steps in communication process. Effective communication between management and employees is the key to a successful company. A company can have the most well conceived programs but if the word doesn’t get out to people then it’s all for nothing. There are eight steps to the communication process; Analyze the Situation with a strategic and tactical perspective and identify the changes or events to be communicated. Define the Objectives and use the SMART approach; specific, measurable, attainable, audience-specific, relevant, and tied to the business. Conduct Audience Research, if you understand the audience than the messages can be more diverse to meet their needs. Determine Key Messages by selecting a theme that fits the message being communicated and tie it to the strategy behind the program. Select Communication Channels, which targets the right media and keeps your message running continuously through its theme. Develop the Communication Campaign by using a project plan that will showcase the findings, cost and the action plan. Implement the Campaign and be sure to get feedback, solicited and unsolicited from employees and reinforcement. Finally, Evaluate the Campaign and modify the communication campaign and the total rewards program will strengthen through increased employee understanding, awareness, and expectations for the company.

References 1. Wiley, J. (2007). The WorldatWork. Hoboken, New Jersey; John Wiley and Sons, Inc.