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Article | Beyond Data

Creative ways to use market data

Using market data intelligence to focus on reward priorities

Compensation Strategy & Design|Future of Work|Health and Benefits|Talent|Total Rewards
Beyond Data|COVID 19 Coronavirus

By Hatti Johansson , Jasbir Singh and Sambhav Rakyan | September 21, 2020

The first in a series of articles about using market data creatively to solve new and unique rewards problems, panelists discuss leveraging market data intelligence to focus on reward priorities.

The pandemic and its unprecedented impact on employee wellbeing, the business environment and the world’s economy created a continuously evolving and uncertain environment for organizations across all industries, and forced organizations to reevaluate their rewards priorities. As such, access to high-quality compensation market data and insights to support decision-making has been critical as organizations leverage an array of data sources to creatively address a range of compensation and benefits issues.

Leaders in our rewards line of business participated in a recent roundtable to discuss emerging questions about work and rewards, including how their clients are creatively using market data intelligence to address these new challenges.

Q. How should organizations explore emerging market practices?

Hatti Johansson: As organizations managed through the crisis, they needed to react and adapt swiftly to protect their employees and their business operations. Understanding emerging market practices was critical for managing risks and restoring stability. Robust market data and intelligence served as the foundation for making crucial workforce decisions and enabled organizations to deliver measured and thoughtful responses.

Many clients wanted to know what their peers were planning:

  • What short-term actions are my peers taking?
  • Are they paying salary increases or postponing them, and what are they planning to do in 2021?
  • What additional measures are they taking?

Willis Towers Watson ran a series of COVID-19 pulse surveys querying organizational practices and reactions as companies shifted from crisis mode to resetting operations. The survey examined how they were rewarding essential workers, maintaining employee engagement and being transparent.

We also expanded our annual Salary Budget Planning survey, which is a crucial market data source for actual and projected salary increases. This year, we included questions on the impact of COVID-19 on temporary reductions in pay, hiring freezes and, furloughs, and other cost containment actions. Organizations used this report alongside our compensation surveys, benefits policies and HR practices reports, to review emerging market practices and gain a more holistic view of their strategic priorities.

The findings from these surveys helped our clients understand how their actions aligned with their peers.

For more unique or tailored questions, we worked with our clients to creatively use available market data sources. Market benchmarking, year-over-year pay reviews, in-depth reviews of critical roles, and considerations around job design and workforce segmentation are just a few of the enablers offered through Willis Towers Watson's survey data and insights. Many clients are looking for customized analytics around competitive market pay positioning by peer group, industry or organization size. We partnered to conduct custom studies or help clients leverage our interactive, advanced software with automation technology to make their own market pay data comparisons.

As organizations think about restoring stability and reopening their workplace, they are still worried about maintaining competitive market positioning.”

Hatti Johansson,
Global Innovation and Product Development Leader

As organizations think about restoring stability and reopening their workplace – while prioritizing the health, safety and wellbeing of employees – they are still worried about maintaining competitive market positioning, including:

  • Impact of short-term actions taken during the crisis longer-term attraction and retention.
  • How to embed flexibility in budget to maximize attraction and retention while ensuring the right balance between fixed and variable payments.

I really think these new challenges only reinforce how important market data is for helping organizations make the right decisions and be thoughtful about the future.

Q. How has the COVID-19 pandemic impacted total reward priorities?

Sambhav (Sam) Rakyan: In the early part of the pandemic, most of our clients focused on cash preservation and conservation, and many implemented temporary salary cuts and hiring freezes. We quickly saw organizations shift their total rewards value proposition to a more purpose-driven strategy focused on employee safety, wellbeing and job protection. As Hatti mentioned, Willis Towers Watson’s pulse surveys highlighted how organizations prioritized rewarding and protecting their frontline workers. Organizations also reviewed their existing health and benefits offerings for pandemic coverage. Some employers developed supplementary plans to safeguard employees in case they are affected by the virus. Many companies paid for the treatment of employees in the interim. Market data had new meaning for organizations as many started to look at opportunities to rationalize and justify people costs.

Market data gained new meaning for organizations as many started to look at opportunities to rationalize and justify people costs.

Our clients started to revisit their operations, structure, size, leveling and jobs to stabilize and prepare for the future. They realized that responding to and recovering from the crisis in an informed way would be critical. A key component is looking at their organization and industry comparisons to build the organization.

We also witnessed organizations accelerating digital programs which intensified demand for digital talent, largely due to moving their operations online almost overnight. This prompted more creative talent retention and engagement approaches. The work-from-home set-up also brought to light shifting demands. Many employees struggled in the initial days to cope with the new phenomena of juggling home duties and work. Our studies show that organizations acted very quickly to help make this transition smooth for employees. Some provided additional support through mentorship and other coping mechanisms in this new environment.

Q. How are companies rewarding critical jobs needed during COVID-19?

Jasbir Singh: The COVID-19 pandemic led to a significant fall in labor demand for many sectors, such as non-essential retail, hospitality and leisure. At the same time, it also led to a sharp increase for workers in essential sectors like supermarkets, warehousing, delivery services and healthcare. Additionally, roles and working conditions that were not considered highly important before the crisis were suddenly critical. For example, cleaning and disinfection services became critical for enabling employees to return to work. Food and grocery delivery personnel became ‘front-liners’ for restaurants, markets and groceries. Having employees work from home became a necessity for many organizations. In effect, organizations had to accelerate their digital journey by urgently upgrading and improving the performance of their technology. As Sam mentioned earlier, this increased even more the value of digital skills and further exacerbated the demand for digital talent. In terms of rewarding essential talent, we found in the recent Willis Towers Watson Salary Budget Planning report that Hatti reference earlier that between 50-70% of companies have required some employees to work onsite during the pandemic. Globally, around a third of these companies provided additional rewards, of which the most prevalent reward was an enhanced cash allowance. Other less prevalent rewards included transportation benefits, non-cash meal benefits, flexible hours, medical care, enhanced medical care, shortened work day and child care.

Q. What are the current and emerging talent needs, and how are organizations going to fill the gap?

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Sam: Looking at the market data – and connecting that with some of the discussions we’ve had with our clients – digital, business continuity and resilience emerged as top skills coming out of this pandemic. The overnight move to a digital environment also encouraged many companies to become innovative. Companies encounter challenges to compensate digital talent based on the traditional approach of functions and disciplines. Many of our clients now customize rewards for their digital workforce and provide reliable quotes for talent sourcing based on exact skill requirements. Willis Towers Watson’s SkillsVue helps to understand the impact of skills on pay for digital talent and which skills are most prevalent.

Jasbir:

As organization emerge into the “new normal”, we are reminded that in tough times, tough decisions need to be made.”

Jasbir Singh,
Managing Director, Data Services

As organization emerge into the “new normal”, we are reminded that in tough times, tough decisions need to be made. Some organizations that are preparing for their annual compensation planning may not use market data in the “usual” way. The pandemic has forced us to be creative with defining and using market data, such as benchmarking the overall organization compensation spend against relevant peer companies or using market data to ensure that critical and hot jobs are paid competitively. The alternative is a loss of critical and high performing talent which is detrimental to performance of any organization.

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