CASE STUDY
A strategic and flexible approach to reward at Nationwide Building Society
A need for increased employee flexibility, improved skill acquisition and reward programmes better aligned with strategic business objectives has led Nationwide Building Society to adopt job families and construct a new pay system around them, according to an in-depth case study published by e-reward.co.uk.
Background
Nationwide is the largest building society in the world and the UK’s ninth largest retail banking, saving and lending organisation by asset size. It is strongly committed to retaining its mutual status.
In the late 1990s Nationwide sought to modernise and streamline its operations in the face of pressure to demutualise and competition from other demutualised ex-building societies and banks.
As part of its change programme, explains Paul Bissell, senior manager - rewards, corporate personnel, it adopted a "more dynamic, strategic and flexible approach to remuneration".
Reward goals
The organisational redesign emerged from Nationwide’s desire to:
respond to occupational and labour market pressures
encourage more flexible working practices
streamline operations
improve customer service andincrease skills.
Moving to total reward
Nationwide's redesign was translated into a new single pay structure, based on job families, in 1998, followed a year later by a new single reward system, which established market-related pay ranges for each family. The organisation was also moving towards a policy of total reward, which Paul Bissell defines as:
"A mixture of pay elements, with a defined cash value, benefits which have an intrinsic value, a positive and enjoyable work environment and opportunities for learning and development, all designed to make Nationwide an employer of choice."
Its next step was to place increasing emphasis on the total reward package, with flexible benefits, personalised pay and benefits statements, a fair and flexible working environment and enhanced learning and development opportunities.
The verdict from both employees and the company is that the changes have been successful, and that the move to total reward is going well.
| What you will find in this report |
| Over 17 pages (4,800 words), e-reward.co.uk examines: |
| Nationwide's reward goals |
| The building society's previous reward system |
| Design and communication tools |
| System of 11 job families adopted by Nationwide |
| Five-level pay structure and progression arrangements |
| The move to a total reward approach: reward, work environment, benefits, learning and development |
| Choices - Nationwide's flexible benefits programme |
| Problems and lessons learnt. |
A final word
"The organisation’s reward policies are designed to make Nationwide a preferred employer and to deliver the best possible services to members. Employees’ avowed satisfaction with the organisation, together with Nationwide’s success, suggests that the policies have achieved their objectives - although we will always be looking to improve what we offer employees." - Paul Bissell, senior manager - rewards, corporate personnel, Nationwide Building Society.
Want to know more?
Title: "A strategic and flexible approach to reward at Nationwide Building Society", E-research, issue no. 1, June 2002, published by e-reward.co.uk.
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