The reward profession is continually evolving and unsurprising 2015 saw an increase in demand for reward specialists. With a renewed confidence in business across the UK, this positive outlook has resulted in companies looking to secure top talent with salaries and benefits packages that can stand up to scrutiny.
In today’s increasingly competitive market, the role of the reward specialist is essential in retaining and motivating top quality staff with more than just a data-driven package. We take a look back at 2015 to give us an insight into what to expect for 2016.
A look back
Although it was a main contributor, the war on talent was not the only driver for change within the HR department in 2015. Jon Kitterhing believes the shift in the definition of reward to focus on more flexible benefits that are tailored to a diverse workforce has been key. It is essential that equal attention is paid to a work-life balance and compensation package that adapts to geographical, demographic and ‘fashionable’ trends and pressures.
The wake of the global recession has also meant a far greater emphasis on complying with legislation and regulation, particularly in the financial services industry. With the numerous regulatory directives such as CRD IV and AIFMD affecting a wider spread of businesses, senior specialists with experience in regulation have seen an above average increase in demand.
All of these factors led to a rise in salary for many reward specialist positions throughout the year, as companies searched for the best individuals to assist in their overall business strategy.
Upcoming trends for 2016
The renewed emphasis on the importance of the reward profession, and experience gained in 2015, has identified particular areas of interest for this year.
There will be more centralisation of global reward functions across matrix structures with many companies looking to investigate the viability of reward for COEs. However, Jon Kitterhing explains “the opposing view is that this type of structure is more administrative, which potentially limits the career opportunities for those entry level employees, who typically display a more aggressive hunger for career development. Equally with the rising cost of the reward specialist, any plan to reduce cost may be less effective where they are commanding higher salaries than their HR generalist peers”. Whether companies are looking to centralise or decentralise rewards, it will be a hot topic for next year.
Reward regulation is an undefined topic that has many ambiguous aspects still to be challenged. Companies are taking a range of views, from corporations looking to build relationships, to the employment of individuals who are more than just compliance focused, in order to find ways to operate more commercially within the grey areas of the regulations. What is certain is that regulatory specialists will be even more in demand as CRD IV begins to include a wider footprint within the financial services sector.
Policing role for financial services
There are three main variations for reward regulation; first, if reward compliance is run from within the reward functions by the reward staff who have regular experience; second, whether a ‘compliance’ skillset likely from a legal background will be hired to work alongside the reward team; and third, whether this will all fall within the wider compliance teams already in the business. If the current compliance team within the business is currently stretched to capacity, the third option may not be feasible.
Multinational banks and global firms reengaging their globalisation plans for HRIS platforms through upgrades to new products and platforms indicates an overall positive economic state. Many smaller firms are hiring HRIS managers to help implement their first ‘serious’ HR platform or embarking on globalisation plans, albeit on a smaller scale. HR platforms can include general staff management systems to new compensation planning tools to budgeting/forecasting modules. Although many of these are planned to ‘talk’ to the overarching HR system, they will need extensive assistance for implementation but also a much greater sense of what the business wants from the system than ever before, as HR teams and business heads realise the value of management information.
Search for talent
As companies identify the need to retain and attract top talent throughout their business, they are also realising the importance of appealing to strong analytical and personable reward specialists that can assist them in creating total reward packages, which in turn will maximize resources for each party. If a reward professional can demonstrate the skills needed to create a responsible and progressive employee value proposition they will be extremely sought after. However this is only possible if the leadership team accept and champion a new way of thinking in this ever progressing commercially focused environment.