Future-fit rewards: Reward strategies for a skills-powered tomorrow  

Reward strategies are being closely examined by executives who are seeking clarity on the skills they have versus the skills they need, and investing in employee upskilling/reskilling is seen as the key to boosting productivity and navigating the changing business landscape.

Traditional compensation management often neglects individual skills and contributions, while pay for skills takes a personalised approach, considering employees' specific talents and market demand. This holistic model combines skill proficiencies, work outputs, and criticality, prioritising the human element in compensation strategies.

Once the who and the why are established, the how becomes clearer. Explore the most common ways to reward for skills.

Pay-for-skills programmes can bolster the employee experience and address disengagement, promote career advancement, and enhance talent retention by providing continuous learning and development opportunities.

While skills-powered talent practices have gained momentum, rewarding for skills has not been a primary focus compared to talent acquisition, career development, and talent mobility. There are common challenges facing businesses that leaders will need to address as part of the skills-powered journey.

To incorporate skills-powered practices, organisations can start by adopting a test and learn mindset to kickstart and evolve their rewards programmes.