We examine the experiences of six diverse organisations and discover how they are wrestling with issues concerning the review, measurement and evaluation of reward systems. The case studies all share a belief in the importance of assessing the effectiveness of their reward practices and all have initiated and now operate some kind of process.
What’s clear from our research is that effective reward management has to be evidence-based. Broadly speaking, the aim of evidence-based reward management is to improve the reward strategy formulation and implementation process, to ensure that rewards more effectively support the achievement of organisation goals and to provide for employee needs to be met. The process recognises that reward systems exist to add value but often don’t, and that it is essential to assemble and analyse the evidence available on how well they are functioning so that improvements can be made where necessary.
Evidence-based reward management gathers internal data on the impact and effectiveness of reward strategies and practices. This involves research, analysis, measurement, evaluation and, importantly, seeking the views of stakeholders. Externally, it carries out systematic benchmarking of good reward practices and analyses and makes use of the practical outcomes of reward research projects. Evidence-based reward management provides the information and impetus which makes an integrated approach to reward management effective.
Our report starts with an overview of the organisations we interviewed (section1), and continues with some of the direct pieces of practical advice provided by interviewees on how to avoid some of the stumbling blocks along the way (section 2). We then offer an analysis of ome of the broad themes to emerge from our discussions with the six HR and reward professionals (section 3). The case studies then follow.
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REPORT CONTENTS
INTRODUCTION
What is evidence-based reward management?
Contents of this case-study report
SECTION 1: PROFILE OF CASE STUDIES
Who we interviewed
Six diverse organisations
Box 1.1: E-reward case studies – organisational profiles
SECTION 2: PRACTICAL ADVICE
To react or not to react?
Timing and choice of “battles”
Role of senior managers
Role of line managers
Most crucial factor is context
Checklist 1: Practical advice to others from case-study organisations
SECTION 3: ANALYSIS
Different starting points
Evidence-based reward in practice
Setting a foundation for information collection
Measuring reward effectiveness
“Non-core” reward measures
Solutions and evidence of success
Barriers to progress
Questions of cause and effect
A final word
Box 3.1: Commonly-used reward measures
Box 3.2: Distinctive reward and evaluation measures
Box 3.3: Evidence of success
Box 3.4: Barriers to progress
Box 3.5: Thoughts on cause and effect
CASE STUDY 1: FINSERV
A financial services organisation currently going through a merger.
CASE STUDY 2: SM&D Co.
A firm involved in the sales, manufacture and distribution of office products.
CASE STUDY 3: ENFORCECORP
Police authority operating across a number of counties.
CASE STUDY 4: ENGINEQUIP
A high-precision engineering manufacturer with half of its operations the result of acquisitions.
CASE STUDY 5: REGCOM
An independent non-governmental regulatory body with a growing workforce.
CASE STUDY 6: HOTELCO
A privately-owned hotel group with operations largely in the UK.