On November 3rd, ChapmanCG brought together a group of senior Compensation & Benefits leaders at the brand new offices of Facebook’s regional headquarters in Singapore. Genevieve Lim, Facebook’s APAC Head of C&B, and Pei Hwei, Benefits Lead, co-hosted an insightful roundtable session which explored the topic of Total Rewards, including closer collaboration with Talent/OD. Attendees from a range of industries and organisations were present including Bank of Tokyo, BAT, Credit Suisse, DHL, eBay, First Data, Fonterra, GSK, ING, JLL, JP Morgan, Mitsubishi, Monsanto, Nielsen, Noble Group, Pall, SAP, Unilever and Veritas. The following article provides an overview and some key highlights from the discussion, which began with a presentation from our hosts.
The Facebook Mission
Facebook started the session with an inspiring introduction including a video of the company’s story, from its initial growth and success, to the plans for the future. It highlighted the organisation’s mission to connect the world — why? Because Facebook believes things are better if people are open and connected, and although user numbers have risen above the one billion mark, the company feels it is only 1% done! With 4-5 billion more to go, and staggering numbers across the region and projected populations, it is clear to see the huge growth potential. Critical to this mission are of course people, and more specifically how employees are rewarded and developed. At Facebook, HR has a strong focus on attracting the best talent and ensuring the right culture to retain valued employees.
There are no rules at Facebook, rather the company has values, in the form of a global workforce of committed employees who focus on impact, ruthless prioritisation and a business built on focus and speed. This is a culture where ‘done’ can be better than ‘perfect’. Projects can get actioned and rolled out quickly and often do; but these have to be right for the business — even global consulting partners must go through a vigorous ‘cultural orientation’ to ensure the right fit. Overall it is a very collaborative environment with weekly Q&A/ Town halls and tough questions asked and answered on every topic, including many around Compensation & Benefits.
The group agreed that what Facebook is doing around group-wide benefits is highly innovative and should be the way forward for most organisations. What is needed and seems to work best across a diverse employee population is a broad and holistic programme that is flexible and takes care of everyone; whilst linking to the organisational culture and values. This could include health and wellness, family-focused benefits, community, individual career growth through collaboration with talent /L&D, financial support, time away from work, or other perks. Employees should be viewed as the brand – if they are happy and aligned, the company will be successful. This widely-varied programme works because different elements will appeal to different sections/ generations of a population, so it can be of great help when putting together a package that doesn’t focus only on financials. Interestingly, this doesn’t always have to be a so-called ‘Total Reward’ statement, which can be difficult to get right; but rather it could be a more typical benefits solution, which is rolled out as a combination of a business and rewards strategy. It was noted that for programmes like this to succeed, it is critical to educate the business and train managers on the rewards philosophy, with performance underpinning all.
When the topic of counteroffers came up, most C&B Leaders agreed that caution is necessary when making these to employees who express a desire to leave the organisation. This is particularly true if a culture of bargaining develops where employees feel they have to come up with an alternative offer in order to initiate negotiations. Most companies don’t engage in counteroffers, as the rate of success is known to be low and often even when a salary increase is achieved, employees still won’t stay. Some companies use counteroffers very occasionally to try and retain the best talent, especially in banking; but even then only the very top performers will be considered. If an increase is offered, it makes sense to implement a retention strategy to minimise the risk of repetition or departure in the short-term, as a constant cycle can become a major issue. A performance measure should also be included; what’s the ROI? If a company can’t offer development, then the employee will leave anyway – the organisation may need to invigorate. What about Equity? It was noted that restricted stock often doesn’t work as well as cash, particularly when it comes to counteroffers. One attendee commented that the issue is really employee engagement, so the counteroffer stage is probably too late if an employee is not engaged both intellectually and professionally.
The Right DNA
The group also discussed the fact that the entire Rewards function should be run as a cohesive team in HR, as C&B becomes irrelevant if not driven by an overall Talent strategy. When employees leave, it is most likely due to a number of factors, rather than solely salary, so taking into account the overall OD/Talent strategy is crucial. Companies need to look at what they are offering, and they should seek to hire employees that are connected to the mission. It was noted that some organisations that don’t top the salary charts still have low attrition, so there must be other factors, which should come into play at the beginning of the talent strategy.
First you need the right DNA — employees must believe in the company, the product, the right colleagues, CSR perhaps – something they relate to. Secondly companies need to have benefits differentiation; flexibility and perhaps perks that expand to dependents and friends. Getting the right people in at the start is key, so look to recruit graduates then develop people’s careers, building trust and becoming an employer of choice. Building a strong Employee Value Proposition is critical in today’s market. In summary, if all of the HR CoE’s (TA, C&B, TM/OD, HR Ops) are in silo, with no communications and connection to leadership; then there can be no holistic people strategy. The overall collaboration should be driven by the business, the strategy should be lead by HR and then supported by all CoEs – an integrated strategy. It was noted that there should also be an investment in talent, capability and competency building.
Analytics and ‘Digital Wellness’
Data analytics across HR, and particularly in C&B, remains increasingly important for supporting recommendations and underpinning how the function best adds value. This information can be used to answer so many relevant questions around how talent is aligned to business performance, as well as for year-end planning. What is the operating plan? What are the compensation budgets, and what will the profit look like? Ultimately does the organisation have money to invest? Compensation analytics mean that HR Business Partners are now sitting at the table and there is more concensus. Decisions are based on data and can include attrition frameworks, bench strength and other factors. People analytics is now a core and essential function in HR – some companies are further ahead than others but most are working upwards from traditional dashboards. The other key consideration is the quality of the data and how to interpret it – HR has to be effective and have the right systems in place. This data can also be very useful when used to look at workforce planning and when seeking mid to long-term clarity regarding the strategy.
Finally, one leading tech company mentioned an interesting new initiative, which involved ‘digital wellness’ based around cloud technology. The organisation had introduced a health device which tracks the fitness/ movement of employees. It is too early to evaluate the success of the p
rogramme, but there will be more to come on this in the future, there is no doubt.
Many thanks go to our hosts at Facebook and all attendees for the stimulating discussion. We look forward to calling this group together again in 2016. Graham Tollit is a Director based in Singapore hwere he leads the global Compensation & Benefits practice for ChapmanCG.
Here’s What People are Saying:
“It was great to get together with peers and discuss stronger alignment between Talent and C&B and how each of us is making that happen. The flow of discussion and sharing of experiences gave some excellent insight into the common challenges we’re all facing and how to tackle those challenges from different perspectives – because often there is no one right answer.” – Daniel Randall, Fonterra
“The roundtable event is a very good initiative put together by ChapmanCG to bring different companies together to share experiences, information and thought-provoking conversations on what the future state of Human Resources should look like. Well done!” Genevieve Lee, Monsanto
“I loved the interaction between the group, especially around being able to package everything we had to offer to the employees under one brand or umbrella and focusing on marketing this well to get the return on Investment…truly Total Rewards! “ Gaurav Gulati, Veritas
“It’s a great platform for best practice sharing and connecting with rewards practitioners. I’ve always gone away with a few ‘aha’ moments from such forums.” Patsy Ng, Hilton Worldwide
“The roundtable was a great opportunity to discuss developments in the Rewards space with a variety of Reward specialists from a broad spectrum of industries.” – Carson Wallace, The Bank of Tokyo-Mitsubishi UFJ
“Very informative and interesting meeting, also provides a fantastic platform to share and interact with other professionals. Looking forward to the next!” – Angeline Neo, First Data
“The session was of great value as the cross industry mix provided first hand insights into reward practices and allowed the opportunity for participants to deep dive into topics of interest.” – Sajjad Parmar, eBay
“It is good to once again hear from fellow Rewards professionals on their challenges and experiences in the areas of retention, sharing collaborative ways to address this issue in a holistic manner.” Jennifer Quek, Pall Filtration Pte Ltd
“It’s a great platform for Regional C&B Leaders which enables ideas exchanges, sharings.” – Doreen Tay, DHL
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