Attrition, attraction, retention—what does HR tackle first? Why not all at once?
The Great Resignation continues its solemn march across organisations worldwide with many businesses examining ways to stem the flow of resignations, attract the best talent or provide learning pathways and improved employee experiences in order to retain existing staff. Employee feedback has revealed that they are seeking flexible ways of working, more learning opportunities and opportunities that will reward them fairly for their skills and contributions to their organisation.
Compensation and benefits are usually the number one motivating factor that interests potential job seekers, with research showing that candidates are much more likely to apply for roles that disclose salary and benefit information. Organisations have long since understood the importance of providing and combination of intangible and tangible benefits in order to appeal to talent whether through attraction or retention.
All you can eat
A combination approach works well however, some organisations take it one step further by offering a ‘pick-n-mix’ approach to their benefits. A cafeteria-style benefits approach—one where employees choose the benefits that match their needs may seem overly complex and costly to initiate but in reality, could be simpler and more effective than you think. In the HR world, offering employees flexible benefits often means a choice of non-core benefits including, dental insurance, health screenings, corporate memberships or even working options. Yet perhaps now is the opportune time for organisations to completely redesign their benefits approach and offer a degree of flexibility to their core benefits in order to turn the great resignation in their favour.
Let us take the issue of raising staff salary for example. An organisation is looking to reward its long-serving staff for their work so is considering doing so by awarding them with a long-standing increase to their base salary. However, operational expenses are hindering their plans forcing them to devise alternatives one of which is to provide a one-off lump-sum payment rather than adding an additional recurring outflow of capital. The options endure hours of deliberation across stakeholder groups until a final decision is made. The organisation is committed to ensuring the long-term financial sustainability of both itself and its talent so opts to implement a salary raise.
Whilst the majority of employees might not object to receiving a raise, the organisation risks shooting itself in the foot and alienating fringe groups of employees due to the simple fact that it does not consider employee preferences or address their short-term needs.
The issue is not the adoption of a long-term approach to employee financial wellbeing perhaps it is rather the impact of the raise spread out over the course of a year, which would be too long-winded and not make a material, immediate difference to some employees’ lifestyle. If the organisation has the capital resources to conduct across the board raises, then it surely too has the capability to adopt a flexible approach to its benefits, one that empowers employees to select the benefit that would meet their needs.
Layers of complexity
Employees could simply be asked, “Do you want a raise, or do you want a lump sum?”—both will amount to the same exact figure over the course of the next year though one burdens the organisation with an immediate upfront capital outflow whilst the other option allows the cost to be spread out across several months. This adds a layer of complexity to flexible benefits from a financial and tracking perspective—does the organisation have the capital to front multiple, immediate one-off payments and does it have the capability to keep track of who chooses what.
Financial conclusions can be drawn from accounting experts as to the feasibility but from an HR perspective, the tracking and option-giving would be much easier than you might think. Technology and HRIS systems can easily assist in the adoption of a flexible benefits approach. HRIS streamlines the enrolment and communication process, enabling employees to simply select their benefits from the palm of their hand.
Employees could browse an e-supermarket stacked with flexible benefit options (that are financially feasible to the organisation) available to them. There might even be a special promotion section where employees could opt to add additional health insurance, annual leave, or wellness products to their shopping cart. The e-shop enables employees to read through ingredient lists whilst AI customer service representatives handle any queries they may have. This leads to well-informed decisions before they hit the checkout; taking only those benefits that are suitable to them.
This exercise could be done annually, with employees having the option to choose the benefits they need depending on any changes to their personal lives. Implementing additional buy-in purchases to the benefits process also aids organisations to offset costs related to setting up or administering a flexible scheme. The flexible package also appeals to employees and has proven to directly correlate to employee retention—employees feel appreciated when benefits are tailored to their needs. Once word gets out, it also signals to candidates that the organisation is an attractive place to work increasing talent attraction. Finally, flexible benefits future proof the organisation as the benefits on offer can be scaled according to external circumstances and the success of the business.
Returning to our previous example, the organisation adopts an e-shop approach which enables them to capitalise on real-time analytics, allowing them to anticipate the vast majority of its employees are opting for a long-term raise whilst only a select few opt for the one-off payment. In this instance, the organisation is not overburdened with forking out large amounts of capital and has vast swathes of data that will lend credence to any future benefit decision-making process. The organisation also fully meets individual employee needs and is able to successfully attract and retain talent that may otherwise leave.
Paul Arkwright
Publisher
