Catering to Gen Y lifestyle with intangible rewards
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"Intangible" rewards have increasingly become a determining factor that employees consider in choosing their workplaces, according to Hay Group.
Chanat Adhibai, a director of the human resources consulting company, said yesterday that due to changes in the lifestyles of new-generation workers, tangible rewards such as salaries and bonuses alone are no longer sufficient to draw in employees.
The new-generation workforce, in particular, has a certain lifestyle that is more “social”. They care more about working conditions. Companies located out of town, for instance, are finding it harder to fill their key positions.
“Sometime it’s not about money. It’s their lifestyle [that causes them to shun certain firms],” he said.
More companies have decided to relocate their sales and marketing units to town centres, splitting them off from factory sites.
These “intangible” rewards that Hay also calls “emotional” rewards include quality of work, work/life balance, inspiration/values, enabling environment and future/growth opportunity.
“For example, if a Gen Y member loves travelling, but your company doesn’t offer travel opportunities, [he won’t look at your company],” he said. Generation Y is generally defined as a new generation of workers who were born during the 1980s and early 1990s.
Companies have decided to move out not just sales and marketing functions from their factory operations, but also other “fast-moving” operations such as information technology. Firms consider that their workers’ performance and productivity could be better enhanced in a different working environment and culture than the legacy culture of the old organisations.
Among the cases is CP All, which had spun off its IT department into a corporation called Go Soft.
“A challenge is if companies can change the old culture [of their spun-off units],” he said.
Companies have increasingly been applying various remuneration schemes for workers in various functions, replacing their “one size fits all” remuneration package, since workers in different professions are motivated differently.
“When rewards are matched with their aspirations, workers’ performance, productivity and satisfaction are boosted,” he said.
Flexible benefits
Companies should apply flexible reward programmes so that employees can choose from a variety of benefits including cash, time off, spa and sports club memberships, cars, life insurance, health insurance, vacations, retirement plans and challenging assignments.
“It doesn’t always cost you money to make your employees happier. Sometime you just alter benefits from the other benefits that they don’t use,” he said.
Sometimes it is not a lack of career opportunity but a failure of the boss or supervisor to communicate clearly to workers about their career path. This is caused sometimes by a clash of generations when a Gen X is a boss of a Gen Y staff.
“In some cases, I found a Gen X line manager had not even been talking with his Gen Y staff,” he said.
Companies should provide appropriate training to their managers, he added.
