We believe it is time to become a “best high-performance place to work.” Are seeking to become a total rewards organization and receiving a designation from Fortune or Working Woman as a Best Place to Work compatible organizational goals? Or is it one or the other? And where do “work-life benefits” fit in the strategy picture for creating a workplace that facilitates growth, contribution, and results? From the standpoint of definitions, total rewards and work-life benefits are strategic initiatives that focus on adding value to the business. The Best Place to Work initiative is a competitive undertaking where organizations try to earn this designation according to rules posed by those who offer the award—probably not a strategic initiative in most instances.<br />
<br />
The business case for total rewards as a strategic initiative is universally focused on the organization becoming more attractive to a workforce it believes can help it be successful over time. Although organizations may define the specifics of each of the four components of total rewards—Individual Growth, Positive Workplace, Compelling Future, and Total Pay—differently, the goal in our view and for many total rewards strategists is to accelerate organizational and employee performance. While General Mills may emphasize a balance of total reward components and Amazon.com may emphasize specific elements, the objective is making the organization attractive to a workforce that will provide value and sustain the organization consistent with its priorities and values.<br />
<br />
If you propose a total rewards initiative to CEOs, and they know what you are talking about, they will ask where the payoff in terms of return on investment will be from such an initiative. Leaders want some assurance that the organization will be better off as a result of the proposed change compared to where it is at present. And we know from experience and research that when initiatives such as total rewards are used to support a workforce strategy that emphasizes skill, competence, and performance results, this win-win helps the organization reach necessary goals. These data give comfort to leaders about the worth of making this change—total rewards are a business initiative that involves the alignment of the workforce with the organization’s future. The business case is a powerful one.<br />
<br />
<strong> Best Place to Work</strong><br />
<br />
While organizations are recognized for providing ergonomically suitable furniture to employees, offering the ability to share jobs, providing the chance to work at home at least some of the time, and granting sabbatical leaves based on service, the Best Place to Work does not celebrate organizations that implement total rewards initiatives based on the sustained growth of workforce skill, competence, and performance. Most organizations granted this designation use it as a recruitment and publicity tool for potential and current employees.<br />
<br />
It does not seem that the Best Place to Work designation is sought after because it is viewed as a potential aid to organizational performance. Indeed, most organizations that seek this designation are already financially successful and do not use competition for this award as a performance improvement initiative. It is mostly viewed as a branding tool as a good employer with some unusual benefits that are more than likely more liberal than are the benefits provided by those that do not seek this award. A “best high performance place to work” focuses on paying for performance, skill, and competence—which makes sense when results matter.<br />
<br />
<strong> In Search of Strategic Alignment</strong><br />
<br />
The Best Place to Work initiatives can be strategically more useful to total rewards if they include provisions for awards wherein the new benefits and workforce advantages are associated with something of value the organization seeks from employees. The precedence for this exists because service and tenure do dictate how some of these benefits are provided—so why not make them also contingent upon continued workforce improvement in critical skill and competence, for example? That would translate becoming a Best Place to Work into a concrete business initiative.<br />
<br />
Strategic alignment would in our view come from being able to develop the business case to answer this question for all stakeholders in the organization—why is this organization a “best place to work”? Think of it from the perspective of other workforce initiatives. For instance, the answer to the question, “Why does this organization use incentives?” is that the business case for this is to improve business results and make those in the incentive plan stakeholders in the organization’s future. So the business case is clear and powerful for incentives. And we believe a strategic case can be made for becoming a Best Place to Work that is compelling and adds value to the business.<br />
<br />
The strategy statement could link total rewards and Best Place to Work in a single business initiative. The ingredients of this strategy could include the following:<br />
<br />
*<br />
<br />
The reason our organization can be successful is because we hire and engage a high-performance workforce.<br />
*<br />
<br />
To us this means a workforce that will expend the effort throughout their career to grow needed skills and competencies and apply them to attain business results.<br />
*<br />
<br />
Creating a high-performance workforce and workplace means avoiding the creation of entitlements—it means being able to change must be an expectation.<br />
*<br />
<br />
In exchange for our workforce adding value and making the organization meet business goals, we will provide total rewards based on performance.<br />
*<br />
<br />
Employees in the top 20% of the workforce in terms of skill, competence, and performance will be rewarded by receiving more of whatever the organization has to offer in recognition of their success.<br />
*<br />
<br />
We can remain a Best Place to Work only as long as we have the performance to match—so we will revisit our total rewards annually and make any changes that are necessary to meet our business needs.<br />
<br />
The specifics are less important than the structure of the business case. It says the organization must remain agile and flexible to change as necessary. And it makes a connection between skills, competencies, performance and whatever form of total rewards is offered in search of becoming a Best Place to Work. It also communicates that tenure and entitlement are not the reason for rewards being what they are. So a strategic focus like this makes business sense. Being a “best high-performance place to work” is what really makes sense to the achievement of business goals.<br />
<br />
<strong> The Message Matters</strong><br />
<br />
Best Places to Work must be growing and successful to provide a compelling future to all stakeholders—including the workforce. Too many organizations provide liberal benefits, perquisites and work-life programs once they become successful. And sometimes organizations are not able to sustain these benefits, and even more often they are not able to develop strong and believable business reasons for the programs. In short, the programs become entitlements, and employees view them as promises that must be kept above all else.<br />
<br />
With a little tweaking, an initiative in search of a business case can find one. The publicity of Best Place to Work can help the migration that organizations need to make to rewarding performance. So the potential is there, and it is reasonable to believe linking it with business goals is within reach—but the focus on high performance is essential to put “beef” in the role rewards play in business success.<br />
<br />
JAY R. SCHUSTER and PATRICIA K. ZINGHEIM are partners in Schuster-Zingheim and Associates, Inc., a compensation and total rewards consulting firm founded in 1985 in Los Angeles. They advise clients on incentives/variable pay, base pay management, performance management, total rewards strategies, executive and sales compensation, and recognition. They received WorldatWork’s 2006 Keystone Award, the highest honor in the compensation, benefits and total rewards profession. They are the authors of <strong><em>High-Performance Pay: Fast Forward to Business Success January 2007 </em></strong>(available at <a target="" href=" http://www.worldatwork.org/waw/worldatwork-dynamic.jsp?/waw/worldatwork-bottom.jsp?http://www.worldatwork.org/waw/bookstore/generic/html/pub1579631614.jsp">WorldatWork</a>.) Check out their other books. . . Pay People Right! and The New Pay. Their Website is <a href="http://www.paypeopleright.com/">www.paypeopleright.com</a>.
