Why SMEs Need a Total Rewards Strategy to Attract, Retain and Motivate Top Talent
How SMEs can adapt by having a total reward strategy.
In today’s competitive hunt for talent, it is not uncommon for many companies to find it challenging to hire, retain and motivate the talent they need.
A recent report1 highlighted the multiple pressures and complex challenges faced by companies. As SMEs continue to compete in the face of talent shortage, there arises a critical need for transformation. They will only be able to adapt by having a total reward strategy.
SMEs, although small, can be agile and nifty to offer employees more opportunities than we think. Having a customisation of combined compensation, benefits, and other rewards allows the company’s unique employee demographics to receive what they perceive to be of value from the company and significantly increase attraction, retention and engagement of talent.
SMEs can offer such opportunities through a systematic and comprehensive reward system based on five key aspects:
- Fair Pay Distribution
SMEs must ensure parity in pay distribution based on individual and company performance, supported by a fair performance management system.
- Employee Benefits
While SMEs may not have deep pockets but are able to provide both monetary and non-monetary benefits which reflect the company’s values and align with what’s important to employees to create a sense of greater engagement and well-being. For instance, some SMEs allow their flexible benefits scheme, such as medical coverage, to extend to their employee’s family members. Additional non-monetary benefits could include staff discounts or corporate annual passes with partner companies.
- Work-Life Harmony
SMEs can recognise their employees’ diverse life commitments whilst ensuring the same work outputs by expanding flexible work arrangements to facilitate employees’ roles as caregivers, or part-time students.
- Employee Recognition
SMEs can acknowledge and reward outstanding contributions and achievements within a company in different ways. This could be demonstrated through long service awards, which celebrate loyal employees; or team achievement awards to recognise departments or teams that have excelled in achieving specific goals or projects.
SMEs can enable a flexible and productive workforce through programmes for upgrading employee skills and knowledge. For instance, training/sponsorship schemes enable employees to master new skills and meet the needs of employees who prioritise personal development. Some SMEs may also offer mentoring programmes or task high-potential employees with greater responsibility to help boost their sense of purpose through job empowerment.
In summary, by leveraging different schemes and initiatives in totality to suit differing employee needs, your company can deploy a strategy to add to your company’s agility and flexibility whilst fostering a sense of value and satisfaction among your employees, motivating and incentivising them to perform and remain loyal to your company.
Having proper reward structures and programmes in place also prevents grievances that may arise from perceived unfairness in terms of salary and compensation whilst meeting the goals and objectives of your company.
Thus, having a strong total rewards strategy to attract, retain and motivate valuable employees will optimise your company’s performance over the long run.
1 PwC Asia Pacific (2023, June). Asia Pacific Workforce Hopes and Fears Survey 2023 Accessed online: https://www.pwc.com/gx/en/about/pwc-asia-pacific/hopes-and-fears.html