This is a repost from the Decusoft.com blog.
The above chart from a PWC employee survey shows that Compensation (Ranked #1) and Benefits (Ranked #4) are among the most important factors Millenials consider when choosing a company. According to PWC’s Chairman, Bob Moritz, to acknowledge these survey results, PWC expanded choice in many rewards areas – including bonuses. Also, according to the PWC’s survey of its workforce, a greater percentage of Millenials want to be recognized and rewarded for their work at least monthly when asked about reward frequency (41% vs.30%). Harvard Business Review
Using Total Rewards (Compensation & Benefits) to attract, motivate and retain key segments of your workforce is still a complex and sometimes manual process. The advent of the Millenials in the workforce has made it even more challenging because they are a new breed: expectations around Rewards may not match the programs and policies you put in place for previous generations.
This year, Generation Y or Millenials surpassed Generation X to become the largest share of the American workforce. This comes after Millenials surpassed Baby-Boomers in 2014. % of Millenials in U.S. Workforce (Pew Research Center).
In my most recent HRMS Software implementations involving Compensation Software, nearly half of all project team members were Millenials. Some were even Project Managers, and many were in IT — which has become a valuable partner for HR.
You may not be able to keep high-potential Millenials for their entire career, but acknowledge their successes, reward them more frequently, and who knows, they may come back, after getting tired of that competitor that doesn’t offer a rewards culture that satisfies them.
To facilitate your rewards decisions and strategy towards Millenials, I share with you the following benefits of my 20+ years of compensation administration, analysis and management consulting projects in Total Rewards and HRMS Software:
- One-size-fits all rewards strategy is out; introducing employee choice & self-selection of Total Rewards are in.
- Millenials like to receive their rewards as cash, gift cards, product packages, or even matched charitable contributions. This can be in the form of a Spot bonus program, or worked into your short-term incentive program some way.
- Increased Transparency — provide explicit about career paths and visibility into next level(s) — whether hierarchical or lateral moves. Millenials value skills development that will help them grow. Don’t assume staying in the same job function is their goal.
Impact for HCM Software or Compensation Software Solutions:
- Build trust through maintaining data points that support productive conversations about next steps in careers.
- Need Data and good, updated data on Jobs, Competencies, Job Functions, Career Paths, succession paths.
- Calibrate outside tool to do workforce planning to support business strategy.
- Which employees fit into your companies’ current and future jobs based on business strategies and needed competencies (e.g., See Succession Planning tools — Examples of 9-Box Grids)
- Total Rewards Statements — Total Rewards including non-traditional choices. Benefit: reminds Millenials of their employer’s investment in rewards by value and by reward vehicle.
- Off-Cycle rewards integration for managers to reward on the spot -flexibly and meaningfully.
- Promotion filters for managers – well-defined criteria for manager to select right job based on employee readiness and performance. Effective planning for promotions creates bench strength for your organization and transparency for your employees to visualize their career opportunities.
That said, Millenials’ preferences in the Total Rewards area do not need to create administrative burdens for you.
Compensation software, such as COMPOSE by Decusoft can help you meet these Total Rewards challenges by automating your compensation planning process, no matter how complex. COMPOSE has a flexible ad hoc reporting tool and experience working with clients of all sizes to develop successful outcomes tailored to your goals. Our approach is different. Hands-on consultants, with experience in the above solutions, work with you during every phase of your business cycle; not just during implementation. With Millenials, Gen X, Baby Boomers and The Silent Generation demanding acknowledgement and rewards, your solutions should be as innovative and varied as your workforce.