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Staying Relevant in Turbulent Time.pdf
- 3. A business ofMarsh McLennan welcome to brighter Staying relevant in turbulent times - Talent trends in Asia October 2022 Godelieve van Dooren CEO Southeast Asia Growth Markets | Mercer Vietnam PSS Event
- 4. EVPs define thedeal at work Compensation Benefits Careers Well-being Purpose Culture Flexibility • Employee Value Propositions (EVPs) have become a common part of organizations’ talent acquisition and retention strategies. • EVPs define what an organization offers to employees (e.g., pay, benefits) in exchange for what employees are expected to offers to the organization (e.g., effort, skills). • For EVPs to be compelling, they must be aligned with employees’ expectations. 4
- 5. A mismatch inexpectations perhaps? 5
- 6. 82 88 82 74 78 76 82 86 81 67 70 67 2019 2020 2021 Pride Motivation Advocacy Commitment Mercerglobal norms Percent favorable levels with comparison to pre-pandemic results Percent Favorable Change Over Time Pride 84% 0 Motivation 83% 0 Advocacy 78% +1 Overall Satisfaction 77% +1 Commitment 71% +1 Engagement isn’t the problem right now Client case study percent agreeing over time 6
- 7. Employees are copingwith a host of new stressors Considering the circumstances, I feel reasonably balanced and healthy right now. 3.75 3.69 3.63 3.63 3.6 3.42 3.81 3.78 3.71 3.74 3.67 3.66 June July August Female Managers Male Managers Male Employees Female Employees Five point scale ranging from Strongly Agree (5) to Strongly Disagree (1) • Working parents are losing 2 days of productivity a week due to child care and stress • Loneliness is on the rise, particularly for isolated individuals quarantining alone • Generation Z employees are worried about the future of their jobs and their careers • Baby Boomers are concerned about their physical health and financial wellbeing • Many female managers are experiencing a double-double shift, resulting in higher levels of cumulative stress See https://www.mercer.com/our-thinking/career/preparing-for-a-more-flexible-future.html 7
- 8. Basic needs • Pay,benefits, security • Retention • Pay and benefits in exchange for commitment Loyalty contract (20th century) Psychological needs • Achievement, camaraderie, equity • Contribution • Intrinsic rewards in exchange for effort ENGAGEMENT contract (pre-pandemic) Well-being needs • Physical, mental, emotional, financial • Sustainability • Healthy experiences in exchange for sustainable performance LIFESTYLE contract (The new chapter) And are seeking a new work experience 8
- 9. 1. Fair pay& social integrity • Fair pay is the top HR initiative to protect financial welfare of employees • But only 28% are looking at internal- external equity this year Which Good Work standards are you acting on? 2. Flexibility & protection • Flex is the most critical sustainable workforce practice for large companies • But only 26% are looking at job security for gig workers 3. Health & well-being • 97% of HR leaders plan to promote long-term employee well-being • But only 36% are introducing a mental or emotional well-being strategy 4. Diversity, equity and inclusion • 1 in 3 executives has DEI tied to their own performance ratings this year • Just 28% of companies have a DEI strategy 5. Employability & learning culture • HR leaders who expect their employees to be highly energized this year spent 62% more on reskilling last year • Older workers are most concerned about employability They stand up for what they value and deliver on Good Work standards Leading organizations come off mute believe investing in good work standards will deliver the greatest ROI are making good work standards a priority © 2022 Mercer LLC, All Rights Reserved. The future of work is here | Mercer 9
- 10. Believe their organizationwill be more successful with remote/hybrid working Believe their team collaborates well while some people are on-site and others are remote Feel more connected to their coworkers when working remotely Believe they have an apprenticeship culture where people learn working side-by-side, not remotely Concerned about the ability of employees to build solid interpersonal relationships with colleagues/leadership Concerned with the potential deterioration of culture Executives are concerned Employees see things differently Executives are concerned about continued remote working, but employees see things differently © 2022 Mercer LLC, All Rights Reserved. What’s worked well so far: Offering flexible work / collaboration training Offering tools / platforms to support emotional and mental well-being Creating a safe environment to share concerns 10
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- 12. *For energized employees Reframingwork-life integration in the new world of work Energized employees are significantly more likely to say they can integrate their work and personal lives Less energized employees are less satisfied and less motivated but more likely to stay Energy amplifier Energy diminisher • Feeling you can always bring their authentic self to work (83%* vs. 49%) • Feeling financially secure today (83%* vs. 68%) Individual • Feeling replaceable by AI (10%* vs. 46%) • Not offering remote/hybrid working especially for Gen Z (54%* vs. 66%) • When pay/promotion decisions are made fairly, equitably, and without bias (82%* vs. 55%) • Managers who understand individuals’ skills and interests (85%* vs. 64%) Business area/team • Lack of diversity (9%* vs. 20%) • Lack of clarity on career opportunities (17%* vs. 47%) • Top leadership team where women and minority groups are well-represented (83%* vs. 66%) • Executive team that prioritizes sustainability strategies and goals (86%* vs. 59%) Strategy/ governance • Slow moving culture (24%* vs. 29%) • Not being rewarded for acquiring new skills (21%* vs. 25%) © 2022 Mercer LLC, All Rights Reserved. 12
- 13. Is the rewardsexperience is ready for reinvention too? Unhappy employees Lack of outcomes Global disruption Time intensive merit processes have not effectively paid for performance nor made progress on competitiveness or equity Only 55% believe they are fairly compensated and 50% believe better performance drives better pay* Economic impact of COVID will tighten budgets, amidst heightened awareness on systemic pay inequities *Source: Mercer Employee Research Normative Database 13
- 14. The Annual PayRaise experience – the Highs and Lows of the Employee E V E N T F E E L I N G S & N E E D S Record financial performance! Excited Anticipation Coworker resigned – and got an offer with a 20% increase! Under resourced– pulling late nights trying to keep up! Performance review – I’ve had a great year! Merit Award – 4% Stressed Frustrated Disappointed Curious Disappointed Confused #@$!#!!! Accomplished Hopeful 14
- 15. And the Highsand Lows of the Manager E V E N T F E E L I N G S & N E E D S Record financial performance! Good news for budgets! Excited Anticipation My team is poached - for 20% more pay Compensation budget - same as last year?! Allocating awards - So much time and energy... Employee conversations – disappointment, blame the budget! OR HR! Surprised Confused Disappointed Stressed Relieved Anxious Exhausted Dread 15
- 16. Are we tryingto address too many things with our merit increase? MARKET COMPETITIVENESS PAY EQUITY PAY FOR PERFORMANCE 6% 16
- 17. How can youimprove the experience given the current environment? Proactively manage competitiveness and equity Rethink pay for performance Strategically budget salary increases Increase Pay Transparency 17
- 18. W H AT’ S H A P P E N I N G T O D AY Setting budgets based solely on what others are doing W H AT S H O U L D B E H A P P E N I N G Strategic planning process for long- term multi-million dollar investment based on your talent strategy Strategically Budget Salary Increases 18
- 19. Proactively manage payequity and competitiveness MARKET PAY EQUITY STUDY COMPETITIVE ANALYSIS MANAGER DISCRETION X% BUDGET EQUITY PERFORMANCE (FUTURE) BUSINESS PERFORMANCE 19
- 20. ANNUAL PAY INCREASE PAY FOR PERFORMANCE RECOGNITION INCENTIVEPAY CAREER GROWTH PAY EQUITY MARKET COMPETITIVENESS Rethink pay for performance EMPLOYEE SKILLS 20
- 21. 5x EM PLOYEE’S PERCEPTION OF PAYIS 5X MORE IMPACTFUL ON ENGAGEMENT THAN HOW THEY ARE ACTU ALLY PAID RELATIVE TO MARKET M OST PEOPLE DO NOT KNOW HOW THEY ARE PAID 83% 64% 35% 14% 30% 45% 3% 6% 21% People who are actually paid above market believe they’re paid: People who are actually paid at market believe they’re paid: People who are actually paid below market believe they’re paid: Below market Below market Below market At Market Above Market At Market Above Market At Market Above Market Source: PayScale Research 69% 69% OF EMPLOYEES SAY PAY TRANSPARENCY IS IMPORTANT TO THEM Source: Mercer Global Talent Trends Work on Pay Transparency 21
- 22. GENDER GENERATION LEVEL Job security Flexible hours Convenient location Timeoff Professional development Health benefits Meaningful work Competitive pay Fun work environment Advancement opportunities Interesting/ varied work Job security Flexible hours Convenient location Time off Professional development Health benefits Meaningful work Competitive pay Fun work environment Advancement opportunities Interesting/ varied work Job security Flexible hours Convenient location Time off Professional development Health benefits Meaningful work Competitive pay Fun work environment Advancement opportunities Interesting/ varied work Gen Y Gen X Baby Boomer Male Female Individual contributor All managerial levels What else makes people stay? 22
- 23. Eight emerging EVPtrends making it PERSONAL Use of choice in rewards Tech media company providing more choice in compensation – allowing employees the option to choose the amount of salary they want to receive in equity focus on FUTURE Digital career exploration Software company providing employees with a digital platform for exploring career paths and identifying jobs that match their skills and interests INCLUSIVE benefits Enhanced reproductive benefits Financial services company providing fertility and surrogacy benefits to enhance access of reproductive benefits to same sex couples more TRANSPARENCY Radical transparency Social media company publishes a salary calculator on its website for employees and candidates to access culture of CARE Health Centric Culture Auto company Recruited a Chief Medical Officer to create a sustainable culture of health. Various health tools are offered, including biometrics, personal health reviews and family health centers. ENGAGING experiences Experiences for Recognition Tech company utilizes Blueboard to recognize employees with curated experiences such as sky diving, cooking classes or weekend getaways making it EASY Finances at your fingertips Retailer employees can get access to an app (called Even) which allows them to cash out early on a paycheck and access financial budgeting tools focus on FAMILY Parental leave for all Online retailer provides employees not only with a generous time off, but a ramp back program as well as a leave share program to pay for a spouse without paid leave 23
- 24. Remember…..best fit notbest practice! 24