Strategic reward at Diageo

CASE STUDY

Diageo is widely recognised as one of the world's leading consumer goods businesses. This e-reward.co.uk case study illustrates that reward strategy formulation is very much an evolutionary process. Reward strategy at Diageo has necessarily evolved and been amended as a refined business strategy focused on "delivering high quality growth in premium drinks" and a streamlined product portfolio was developed. New demands on the organisation mean that a new reward strategy had to be evolved to meet them.

Company profile: Diageo

Employees:	24,561 employees worldwide (23,427 full time 1,134 part time), as at 30 June 2003.
Location:	Headquarters in London and operations in 87 countries worldwide.
Business activities:	One of the world's leading beverage alcohol businesses with a string of international brands. Markets a portfolio of widely recognised beverage alcohol brands including a number of the world's leading spirits and beer brands such as Smirnoff vodka, Johnnie Walker Scotch whiskies, Guinness, Baileys, Captain Morgan Rum and Tanqueray gin. Owns production facilities including maltings, distilleries, breweries, packing plants, maturation warehouses, cooperages, vineyards and distribution warehouses. Listed on both the London and the New York stock exchanges.
Web site:	www.diageo.com
Interviewee:	E-reward.co.uk interviewed Nicki Demby on 15 October 2003. Nicki is Diageo's performance and reward director.

What you will find in this report	Page no.
As we see in this 13-page (4,700 words) case study, written and researched by e-reward.co.uk, when it comes to formulating a reward strategy compensation and benefit professionals all too rarely start with a clean sheet. They have to take note, and keep taking note, of the changing situation in their organisation.
Overview	5
Integrating reward and business strategy Reward strategy aims -- process of linking strategies -- vertical alignment	5
Background About Diageo -- HR goals	6
Reward approach Key principles -- pay and bonuses	6
Pressures for change External environment -- low pay inflation environment -- changes in the business strategy -- changes to HR strategy	7
Human resource strategy Consultation exercise -- reward and recognition -- talent management -- organisational effectiveness	8
Business strategy Goals -- focus on premium drinks -- brand management organisation	8
Executing the business strategy Market participation -- product offering -- business effectiveness	8
Implications for reward Coherent set of reward principles -- global guiding principles -- local practices	9
Verdict and lessons learnt Role of reward -- the verdict -- final word	11
List of boxes
Box 1: Reward at Diageo	10
Box 2: Talent management in a new economy	11
Document extract Organisation and people strategy	13

Want to know more?

Title: Strategic reward at Diageo.

Issue no.: e-research no. 16.

Date: November 2003.

Pages: 13 (4,700 words).

Availability: Published by e-reward.co.uk. Click on "Research Reports" on the left-hand navigation panel of the e-reward.co.uk web site and complete the simple online subscription form at

www.e-reward-data.co.uk/content/ResearchReports.asp

For more details email: paul@e-reward.co.uk

Posted 20 January 2004

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Strategic reward at Diageo