Design employee reward programs that inspire and retain

Employee reward and recognition programs incentivize employees as they support your business goals. But ‘rewards’ means different things to different people and having a counterbalancing organizational perspective is equally important. So, it’s crucial to design your employee reward program specifically for your workforce.

Standard employee reward programs might contribute to burnout

People need to feel appreciated, so your workforce appreciation efforts count – both to motivate and to avoid burnout.

To support your people’s mental and physical well-being and incentivize performance, having the right employee reward and recognition programs are essential. But in this era of individualized choice, ‘rewards’ means different things to different people at different life junctures.

The ‘wrong’ employee reward programs – the ones that don’t meet individual needs – are part of the reason employees are burning out. To prevent it, organizations now need to go beyond the traditional contractual rewards of pay and broad-brush benefits plus ad hoc components.

How do you know what rewards your employees need?

Begin by asking them without preconceived ideas.

To personalize workforce rewards, companies have begun using ‘personas’ to identify what matters most to target populations and to operationalize their employee rewards program for distinct groups. 

Innovative rewards programs effectively address individual’s preferences – enabling them to feel healthy, supported, and energized, personally as well as professionally – while staying within organizational and cost realities. A balance can be achieved with the right reward and recognition strategy.

Effective workforce rewards design requires:

  • Embracing the differentiated needs of a diverse, multigenerational workforce, and defining the appropriate engagement mechanisms for each group,
  • Understanding individual employee experiences and categorizing those experiences into personas,
  • Holistically addressing employee needs with a more nuanced and flexible approach,
  • Considering all perspectives: personas, organizational needs, industry standards, regulatory landscape, competitor offerings, cost, and societal values, and
  • Formulating a rewards program that harmonizes with your other employee value propositions (EVP) and total rewards offerings.
Total rewards

Total Remuneration Survey

The world's largest and most comprehensive remuneration resource.

Employee reward programs as talent retention tools

Having an outstanding reward and recognition program as a talent attraction tool is important in a competitive, employee-centric labor market. But once employees are on board, designing for employee engagement and retention becomes the real challenge. 

To stay with an organization, employees want rewards that enhance their professional, and increasingly – personal – experiences. 

Exceptional employers are developing employer-curated career paths and guidance and the more transparent and flexible these options, the better. Employers are becoming much more involved in employees’ non-work lives, too. Thriving organizations are embracing a holistic notion of well-being, providing programs to bolster people’s physical, financial, emotional, and social health.

Finally, employers must offer rewards that connect with employees through a sense of common purpose. Motivated employees see their work as contributing to a larger purpose, not just as a job. Employers can nurture a truly unique connection with the organization by: 

Four essential inclusions in employee reward programs

To make reward meaningful for both you and your employees, your program should be:

    Mercer’s employee rewards services and solutions

    Our consultants partner with you to develop competitive workforce reward and recognition frameworks to help you attract and retain the best talent in the market. We can help you improve performance and boost your competitive advantage.
    • Salary and benefit benchmarking surveys

      Whether you’re developing a new competitive pay structure or aligning productivity and performance for your people, access to a robust set of data and benchmarks both at market level and at specific job levels is critical to attract and retain the best talent for your business.
    • Workforce reward and compensation

      We partner with clients to develop robust workforce rewards and compensation structures with your business objectives in mind. We ask challenging questions, analyze data in rich, targeted ways to ultimately help you in crafting breakthrough solutions.

    To solve your most pressing employee reward challenges, we also offer Packaged Workforce Reward consulting solutions.

    Irrespective of organizational size and structure, the most common employee reward issues often hinder organizational agility. In response, we have developed a range of solutions that can be used to bring structure and drive consistent decision-making when addressing the most common workforce reward hurdles.

    Our Packaged Workforce Reward consulting solutions are built on Mercer’s HR consulting heritage, delivering best practice design combined with practical tools. Our solutions establish the foundations for more effective HR and employee reward management in the areas of highest focus, including: 

    • Grading and pay management 
    • Sales compensation 
    • Company cars
    • Gender pay reporting and equal pay.
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