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Do you want to improve your total rewards offerings in order to retain your best talent and attract the best new people to your company? You’re not alone! Many companies are improving their employee-centric benefits to meet employees’ heightened expectations.
But in the business world, even the best intentions always circle back to one thing: budget. Improving your total reward strategy to offer more employee-centric benefits is a great idea, but chances are those improvements will come with a price tag.
So how do you convince your executive team that the improvements will be worth the extra budget? In other words, how do you get leadership buy-in for total rewards?
Strategy #1: Shift the Focus From Money to Experiences
Many leaders think of nothing but salary and insurance benefits when they hear total rewards. It’s HR’s job to help them redefine that.
Total rewards encompasses much more than just compensation and traditional benefits. In fact, those have become employee expectations, which diminishes their reward value.
In order to make total rewards truly rewarding (and to make improvements more attractive to leadership), it’s time to expand the definition of the rewards. To us, total rewards include:
- Employee recognition
- Professional development
- Work-life balance
- Work culture
Improving these aspects of your total rewards offerings will require a much smaller increase in budget compared to increasing compensation. And because employees don’t have firm expectations for them (like they do with their salary needs), these benefits are extra rewarding when you offer them.
Consider this example of a conversation between you and the executive team:
- “We’d like to give everyone raises so that they stay longer.”
- “We’d like to invest in an employee recognition software that lets us recognize and reward—both monetarily and non-monetarily—all of our employees for the hard work they’re doing.”
The first option will likely cost tens of thousands of dollars, and many executives are going to be hesitant. However, the second option will be more affordable, more effective, and more impactful for employees.
Strategy #2: Understand and Share the ROI
In order to obtain the buy-in you need to make your total rewards more robust, you’ll need to establish and show the ROI of such a venture. Without further ado, here are some stats you’ll want to know:
- Recognition programs increase engagement, productivity, and performance by 14%.
- 40% of employees would put more effort into their work if they were recognized more.
- When companies prioritize recognition, employees are 3X more loyal.
- High-performing companies are 10X more likely to use employee recognition programs.
- Employees who feel recognized enough are 4X more engaged.
- 71% of employees say training and development increase their job satisfaction.
- 68% of employees would stay with the company for their entire career if the company helped them gain new skills.
- For every $1 spent on mental health care, companies can expect a $4 return.
- Workplace stress costs the U.S. $500 billion each year, and 550 million work days are missed due to stress.
- The ROI of wellness perks is 8X what you spend.
- Employees who have schedule flexibility are 3X more likely to be happy at work.
- Radical flexibility options raise the amount of high-level employees by 40%.
- 56% of employees who quit their jobs say lack of flexibility was the #1 reason they quit.
- Non-traditional work-life balance benefits improve morale, retention, and culture.
- 9 out of 10 employees would take a pay cut in order to have more meaningful work.
- Employees who feel a purpose at work are 4X more engaged.
- Work culture is 10X more important to employees than pay.
- Employees who enjoy their physical work environment (natural light, air quality, temperature), are 16% more productive, 18% more likely to stay, and 30% more attracted to your company.
These are the types of statistics executives like to see. This way they’ll know that investing in more wellness programs and professional development opportunities won’t be a waste of money—they can expect happier, more productive, and more loyal employees.
Strategy #3: Increase the Efficiency of Your Existing Budget
Instead of trying to sell leaders on spending more on total rewards, instead consider adjusting your existing budget to make it more effective. Here are some ideas:
- Adjust your existing offerings. Do you already offer some perks and rewards that employees don’t really use? Talk to your employees and figure out what exactly they want, and then redistribute those underutilized funds to perks that employees will love!
- Use your existing recognition budget more frequently. Instead of saving all this budget for one big holiday gift, spread smaller amounts to your employees throughout the year. This frequent recognition will be more effective.
- Emphasize professional development. Hiring externally costs more than hiring internally. Instead, focus on developing and training existing employees—this saves you money and shows your employees that you’re invested in their success.
- Realign everyone’s work to be value-driven. Ensuring that everyone knows how their work contributes to the success of the company is totally free, and it comes with some big benefits. Feeling purpose at work increases employee engagement, retention, and performance.
- Implement non-monetary recognition programs. A wall of fame, a thank you card station, or social media shoutouts are some examples of ways to show employees appreciation without spending hardly anything.
- Introduce flexible policies. Allow employees to work when and how they want in order to take care of their personal lives. This work-life balance is crucial to employee happiness, and things like hybrid work, extra PTO, and variable schedules won’t cost you a dime.
You can improve the efficiency of your existing budget, which, in turn, wil help employees feel more valued and keep executives happy. It’s a win-win.
Improve Your Total Rewards Today
Improving your total rewards strategy isn’t about dumping more money into compensation and hoping for the best. It’s about being creative with more modern benefits that employees will love, such as recognition, professional development, flexibility, and wellness support.
By implementing these cost-effective strategies, you’ll create a company culture that everyone is happy with, from the executive team to the newest hire.
If you want to learn more about affordable and impactful recognition, schedule a demo with Awardco today.