Spot Bonuses or Summer Fridays? How to improve your benefits and win the war for talent
People teams are constantly asking us what recommendations we have for winning the war for talent. Should you initiate Summer Fridays? A #kudos channel on Slack? Peer spot bonuses?
An increasing number of employees are experiencing stress, anxiety, and burnout. A record number are quitting their jobs. Combine that with the long-term “skills mismatch” problem and it’s no surprise that employers are struggling to hire and retain talent. The Great Resignation is threatening to stunt even the fastest-growing companies.
People teams must adapt by first understanding their organization’s relative competitiveness in the marketplace and then iterating upward. No two organizations, cultures, or employees are the same, so there’s no silver bullet. It’s key to understand your unique dynamics and operate accordingly. Here’s our 3-step approach:
Step 1: Identify the relative competitiveness of your overall compensation today
For decades, many psychologists have used Maslow’s Hierarchy of Needs to understand and describe human motivations and behavior. Put simply, it states that humans prioritize activities sequentially, moving to the next most important priority only once the current one has been sufficiently achieved.
Just like how humans prioritize basic survival before fun and relaxation, so too your organization’s approach to compensation needs to solve for the bare necessities before getting lavish. For example, your office amenities don’t matter much if employees aren’t compensated enough to live anywhere near your office without a frustratingly long commute.
Of course, every human, role, organization, and industry is different. There’s no universal hierarchy of compensation packages. What’s considered competitive in one industry might be considered stingy in another. That being said, you can still use a general model for making sure that you’ve prioritized the essentials first, so that employees actually appreciate when you layer on more generous offerings.
Step 2: Get specific feedback from your workforce and be responsive
While rules of thumb are helpful, there are nearly infinite ways to change and improve benefits. Many well-intentioned HR teams have been frustrated by trying to design a generous and inclusive package only to find that employees by and large don’t appreciate it.
Avoid the guesswork by involving stakeholders in the decision-making process. Ultimately your employees will provide the best perspectives and sources of inspiration. Grab these resources:
We recommend one-on-one conversations with a diverse set of employees across all departments and levels within your organization. Focus on perceptions of compensation competitiveness, sources of both energy and stress, and examples of experiencing highs and lows. Probe at what employees are grateful for and disinterested in.
The goal is to move beyond inaccessible or low-impact “vanity” forms of compensation and benefits toward more modern and relevant, high-impact offerings. For example, your organization may be spending significantly on swag that employees discard (or wear as pajamas) when standing desks would be more appreciated (and boost productivity).
For surveys, you can find an entire set of questions in our guide. Here are our favorites:
- What is your #1 personal wellness goal? [Open-ended]
- When it comes to work, how easy or difficult is it for you to achieve peak performance? [Scale: Very Difficult → Very Easy]
- I believe employee wellbeing is a top company priority. [Rate: Not at all true → True]
- If our company were to subsidize or fully provide the following products and/or services for employees, how interested would you be in each? [Rate: 1 → X]
- An e-learning or coaching subscription (e.g. Udemy, Coursera, BetterUp, etc.)
- A meditation app subscription (e.g. Calm, Headspace, Breathwrk etc.)
- An at-home fitness subscription (e.g. Peloton, Tonal, Mirror, etc.)
- A studio or gym subscription (e.g. Classpass, SoulCycle, Equinox, etc.)
- A healthy food stipend (e.g. Purple Carrot, Sweetgreen, Thrive Market, etc.)
- A virtual therapy stipend (e.g. Talkspace, BetterHelp, etc.)
- A work-from-home stipend (e.g. Autonomous, Vari, etc.)
- A family care stipend (e.g. Urban Sitter, Bright Horizons, etc.)
Many high-growth organizations will notice that their workforces have diverse needs and interests when it comes to personal wellness. Parents may have completely different priorities compared to new graduates. Hand-picking partners and creating one-size-fits-all benefits programs can be inaccessible to large portions of a workforce which is why we built JOON as a platform to flexibly administer any benefit.
Step 3: Avoid long-term commitments by running pilot programs and iterating
No matter what you decide, every employee engagement initiative or benefits program is going to need ongoing tweaking and fine-tuning. Some initiatives sound great on paper but fall apart when rubber hits the road.
Many organizations make the mistake of locking themselves into long-term contracts and commitments without the flexibility to adapt to changing trends and workforce needs. Whenever you engage a new vendor, demand contract flexibility! Ask for shorter contracts or pilot programs with mutually-defined success criteria such as the following:
- Employee utilization (% that use benefit)
- Employee feedback (% that appreciate benefit)
- Employee outcomes (% increase in key performance indicators)
- Cost and return on investment (impact on bottom line)
At JOON, we scrapped annual contracts in favor of month-to-month engagements to give employers total comfort and flexibility. We encourage piloting new benefits programs to a subset of employees first, before going all in on costly and irreversible company-wide rollouts.
To win the war for talent, you need to find what works for your unique organization and workforce. Other companies may have packages that work for them but won’t work for you. The best People Teams adapt to the market environment and employee feedback, and then rapidly iterate.