The 2011/2012 Talent Management and Rewards Study, North America
Overview
Despite a volatile economy and high unemployment, almost 60% of North American companies are having trouble attracting critical-skill employees, an increase over 2010. In addition, organizations will continue to face strong pressure to manage costs in the coming year as they experience slow growth in productivity and sales.
These are some of the top findings of the 2011/2012 Towers Watson North American Talent Management and Rewards Survey, conducted in early summer 2011. Findings also showed that a majority of employers are responding to the economy by expecting employees to work longer hours than before the recession and sharply decreasing the rate of increase of merit budgets.
This year's report focuses on trends in reward and talent management programs, accompanied by our related insights to drive effective design and delivery. And the critical insight from this year's study is one of sustainability and three talent imperatives. To get ahead, organizations should go beyond articulating and documenting their employee value proposition and total rewards strategy. To significantly improve their human capital risk management and increase the ROI, organizations can rely on three guiding principles — integration, segmentation and agility — to fundamentally transform their reward and talent management model.
We encourage you to consider these concepts in the broader context of your organization’s employee value proposition (EVP) and total rewards strategy.
Key Findings
Attraction and retention. Only 11% of all organizations are having difficulty retaining employees generally — but the number of companies (six out of 10) having trouble retaining critical-skill employees has increased by five percentage points in the U.S. (31% to 36%) and four percentage points in Canada (35% to 39%).
The changing employment deal. Most organizations (65%) expect employees to work more hours than before the recession; and over half (53%) expect this to continue — putting particular strain on professional level employees.
Aligning programs with objectives. Organizations with reward and talent management programs that support their business goals are more than twice as likely to be high-performing companies (28% versus 12%).
Integration of reward and talent management programs. Only 36% of organizations with a competency model link it to their reward programs, and most organizations have been unable to effectively leverage their investment in HR technology.
Segmentation. Only 44% of organizations formally identify employees with critical skills. And while 68% of organizations identify high potentials, only 28% inform employees identified as such.
Agility. Organizational funding for short-term incentive (STI) programs increased sharply last year from 88% of target to 111% of target (as profits increased), and employers expect to fully fund STI programs in 2011.
Press
- Why Your Top Talent Wants Out CFO Magazine
- Canadian Companies Having Difficulty Attracting Critical-Skill Employees, Towers Watson Survey Finds
- More U.S. Companies Having Difficulty Attracting Critical-Skill Employees, Towers Watson Survey Finds
- MSN online: "Yes, you are spending more time at the office"
- WSJ online (suscriber access): Employees With 'High Potential' Need to Know
Press Contacts
For press inquiries or to inquire about speaking engagements, please contact the following:
Ed Emerman
609-275-5162
eemerman@eaglepr.com
Juliet Piekarski
juliet.piekarski@towerswatson.com
Three Principles for Creating a Sustainable Talent Management and Reward Model
To deliver long-term value, talent and reward programs must integrate with each other and the business strategy, maximize effectiveness in all employee segments, and be able to adjust to changing business conditions. Three key principles can guide organizations as they design and implement their reward and talent management programs:
- Principle 1 — Integration: Aligning reward and talent management programs with each other and within the larger framework of the businesses strategy and objectives
- Principle 2 — Segmentation: Delivering different employee experiences to different employee segments in order to meet their needs cost effectively
- Principle 3 — Agility: Adjusting or adapting programs to changing business or economic conditions in order to more effectively manage risks and improve performance
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