From payroll generation, compensation & benefits to now total rewards- What are your views on the evolution of this vertical?
Absolutely!! The function of C&B, like the overall HR function, has evolved a big deal in terms of how organizations and business leaders view it. I don’t think it was too far ago that this activity (payroll) rolled up under Finance function in many organizations!
Over a period of time, we graduated to compensation and benefits which in itself was a big shift. The vertical worked closely with the business to align with the broader strategy and in the first 2 decades of liberalized economy, C&B played a vital role in attracting and retaining key talent. Large progressive organizations started practicing “pay for position/ performance” principles, rather than manager discretion and could keep their top performers engaged.
As the industries and talent started maturing and with tighter economic environment, everyone realized that monetary aspects would do only as much in building a strong talent pool. That’s when the concept of total rewards, which includes all offerings, monetary and non- monetary, that an organization has for an employee came into discussion. Employees realized that career development, skill enhancement and other aspects of one’s role are equally important- well being of self and family and flexibility to choose from a list of options became important. Organizations started to talk about EVP and total rewards became an integral part of this whole framework. Companies also realized that there are existing practices and policies in place; they just need to be packaged and positioned in a certain way.
The stakeholder management with a CFO, CEO and HR Business Partners is a tricky one for a compensation & benefits professional. What would be your suggestions to the young Compensation & Benefits professionals for managing these stakeholders?
One needs to understand what the business priorities are and the challenges around it. We can’t have an HR policy (including total rewards) that does not support business priorities. I also believe that organizations can’t survive without people and hence, no business leader would want to take a decision which is against people.
Role of entire HR function is to balance out between what is right for the organization and in the same context what needs to be done for the people to retain their top and critical talent.
C&B function has to play the role of an expert and come up with innovative thought process to support the org priorities. There has to be flexibility where one needs to understand the difference between theory and application of the same. If one sees a risk with a certain decision, highlight it, but try to get the larger picture. C&B function has a big advantage of having data to support it’s stance and leaders appreciate it, but not all human issues can be responded with only data.
What are the competencies required in a compensation & benefits professional?
Ability to understand business and strategy; problem solving approach; analytical abilities to create multiple solutions; comfort with large data sets, eye for detail, tech- savvy. Executive presence is critical and required from an early stage since stakeholders are mostly senior leadership.
Many times, I have observed C&B person being confined to their laptops, interacting mostly with HR business partners. They should have an ability to network and interact with larger organization so that they have their independent feel of the pulse. Equally important is network in the external world; lot of times, you need info/ data that are beyond the regular comp & ben surveys.
Integrity and maturity is another key competency for a C&B professional. There would be occasions when a C&B person knows his/ her compensation against the peer group and the market. One has to have the maturity to handle these kind of sensitive information.
A C&B person is part of HR function first, so most of the qualities listed above pertain to any HR professional. Openness to “Share and Learn” should apply to everyone, irrespective of function.
There is always a thin line between what’s enough and what’s not when it comes to defining a Total Rewards Strategy for an organization. What steps would you use to evaluate a total rewards strategy before rolling it out?
Total rewards strategy has to be aligned to business strategy completely and has to be reviewed frequently to keep it relevant. If the business is planning a fast growth- does the sales incentive plan support it? Or if growth means hiring a large pool of talent with certain skill sets, does the rewards strategy support skill based pay differentiation to encourage people to re- skill themselves within the organization?
It is critical to know what is valued by the employees since they are the consumers. FGDs/ surveys etc are useful ways to check what employees want. For any Total Rewards strategy, affordability and compliance are hygiene factors which should be non- negotiable.
From among the many employee benefits schemes implemented by you, which have been the most successful ones?
This is very contextual and hence I would not call out any specific program; there are employee groups where employee assistance programs (EAPs) have been successful and have helped improve productivity of people. Benefits around crèche facilities for employees’ children was a hit in one organization but I saw it failing miserably in another. Telecommuting facility is something which I assume is the most used benefit in many sectors.
That is why I suggest that what the consumer wants and what is viable for my business become the key for success.