How SMEs Can Use Total Rewards to Attract, Retain and Motivate Top Talent (Part 2)

How SMEs successfully deployed their total rewards initiatives

25 Jun 2024 Articles Performance management Remuneration Tripartite Guidelines on Fair Employment Practices Best practices

In the first instalment of this two-part series, we covered how SMEs could rethink their total rewards strategy in five aspects to gain a competitive edge to attract, retain and motivate valuable employees.

In this article, find out how two SMEs successfully deployed their total rewards initiatives that led to a more motivated workforce and better business results:

 

Case Study 1: Effective Ground-Sensing and Review to Foster Strong Career Growth for Employees

Background

The SME, a consultancy firm in the science and technology sector, experienced a change in their workforce profile when the company’s growth picked up. They realised that the needs of the workforce had evolved, and they would need to find new ways beyond their standard compensation to motivate employees and improve retention.

Implementation

Understanding Employee Needs

  • From their annual employee satisfaction surveys, they noticed that career progression and growth had become the top reason why employees were motivated and stayed with the company.
  • Through their various employee engagement sessions, the company recognised that employees yearned for career growth, but not all wanted to be people managers.

Supporting Employee Choice and Career Exposure

  • To provide equal career progression for employees, the company decided to carve out two tracks for career growth – People Leadership and Specialist (Individual Contributor).
  • Opportunities were created for employees with the potential to try the People Leadership track, allowing them to assess their own suitability and step out of the trial without any impact on their performance rating.

Regular Review and Improvement

  • Consistent with their values, the company maintained a culture of continuous improvement with regular performance conversations and reviews.
  • They also rewarded employees who came up with ground-up suggestions and actions that led to tangible results, with appropriate incentives and recognition.

Outcomes

Their strategy paid off as they experienced high growth and retention from 10 to 40 employees in 5 years, with higher employee satisfaction and engagement scores across the board. Such early interventions enabled the company to grow while keeping a cohesive workforce and a steady pipeline for succession.

 

Case Study 2: Effective Communication and Implementation of Performance Management System to Ensure Fair Rewards

Background

The SME had undergone a significant transformation from a family business in electronic distribution to a semiconductor manufacturer. It extended its operations to four subsidiaries across Asia and Europe and tripled its headcount in the last three years.

 

With plans to grow the company further, there was a need to ensure employees remained engaged, motivated and skilled to meet the growing organisational targets. This led to the establishment of a fair reward system based on a new performance appraisal system, and formal key performance indicators that clearly link individual and organisation performance to motivate and reward employees fairly.

Implementation

Leadership Taking the Lead in Employee Communications

  • The CEO personally explained the rationale of the new system to employees via email and their all-staff townhall to ensure that all employees are onboard with the company’s shift.
  • The management also promptly addressed concerns received through various communication channels.
  • By carefully managing this change, the company prevented any misalignment or miscommunication.

Ensuring Proper Implementation

  • The company briefed employees on the new system, and made all policies and processes easily accessible to employees for their quick reference.
  • To ensure proper performance evaluations, supervisors were trained to assess employee performance fairly and manage expectations sensitively. Accurate documentation of performance goals, ratings and feedback allowed employees to align their expectations with supervisors on where they did well and could grow further.
  • The objective setting of measurable performance targets and proper recognition of job performance was closely tied to performance bonuses that were awarded especially to top performers to motivate and reward employees working to meet the evolving organisational targets.

Outcomes

Through strong communication channels and commitment to implement a fair performance management system, the company was able to shift employee mindsets and behaviours to one that strives for performance and achieve business goals in their expansion plans. With clear objectives and targets that were linked to a fair distribution of rewards, staff were motivated to contribute and grow with the company.

In summary, SMEs can effectively implement total rewards when they make the effort to understand the gaps, communicate closely with the ground for alignment and continually review for improvement. This way, they can harness their total rewards strategy to stay competitive in attracting, retaining, and motivating employees fairly.

 

To find out which other aspects of total rewards SMEs can offer beyond a pay package to compete for talent, read Part 1 of the series.


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