For the first time since the Great Recession, employers are working harder than ever to retain and attract the best workers. Traditionally, such recruiting and retention activities have been housed with HR business partners in the compensation domain.
A new UNC Executive Development white paper, Rethinking Total Rewards, examines whether it is time to rethink these activities as part of a broader total rewards strategy, in which career development and training will play a key role. Horace McCormick, program director for UNC Executive Development, explains that total rewards are the comprehensive monetary and non-monetary return employers provide employees in exchange for their time, talents, efforts, and results. For most organizations, in addition to salary, total rewards includes items like health care benefits, retirement contributions, and paid leave, as well as some other perks like company cars, wellness programs, and stock options.
However, McCormick reports that progressive companies are promoting their career development opportunities as part of a total rewards packages. This might include “learning in the form of tuition assistance, corporate universities, attending seminars and conferences, self-development, challenge assignments, and even sabbaticals. Coaching and mentoring also fall into this category, along with advanced opportunities like overseas assignments, career ladders and pathways, and providing employees on and off ramps throughout their careers.”
In fact, the white paper presents plenty of evidence to support the addition of learning opportunities to a total rewards package. According to a 2014 Towers Watson study, “career growth is the third most frequent reason employees cite for joining an employer and the second most frequent reason for leaving.” Unfortunately, even though employers know this, few are actually addressing the issue. The study reports that only 37 percent of employers say their employees know how to influence their careers and just one in four organizations feels their managers provide career management support to their employees.
There is hope, though. Rethinking Total Rewards states that the Society for Human Resource Management’s (SHRM) Special Expertise Panels found that “employers will offer more intangible rewards in their total reward packages, including career development and growth and work autonomy” in the next few years. Likewise, the global consulting firm Mercer predicts that employers will invest more in career development and training in the coming years. And in his predictions for the HR profession for 2015, Josh Bersin of Bersin by Deloitte finds that “skill development is a priority among HR leaders, and so employee development will also be a focus area to drive organizational performance and to improve employee engagement.”
Bottom line: To attract and retain high-potential and high-performing employees, career management should be a key part of an organization’s total rewards strategy, not just a function of the training and development function. McKormick advises chief learning officers and chief talent development officers to consider the following action steps (offered by Towers Watson) to improve their career management strategy:
- Review the organization’s existing job architecture to define or refine career paths so high-potential employees can see clear vertical and lateral opportunities.
- Create a career architecture and maps that reflect HR and business strategies.
- Ensure that competency models are aligned with job architecture to help high-potential employees understand how work is to be done.
- Provide managers training and tools to help them identify and communicate career opportunities tailored to high-potential employees’ skills and experience.
For advice on how to launch a total rewards strategy, download the UNC Executive Development white paper, Rethinking Total Rewards.