Fundamental to achieving this goal of consistent and effective communication of reward and benefits is having a global benefits strategy that demonstrates the ROI and value of benefits investment on an individual employee level.
With a robust strategy, organisations can see exactly what they are spending in each country or region, which gives them a better control over their costs, and a better scope for reducing some of those costs.
This clarity also enables them to develop the right benefits packages for employees based in multiple locations across the globe, at the same time, creating a global benefits brand that enhances employee engagement.
Working to a well-defined benefits strategy, HR can be fleeter of foot when it comes to establishing benefits in new markets, or delivering to M&A situations, safe in the knowledge that they are complying with local regulations and reflecting local market practices.
Data from 2014 Global Employee Benefits Watch found that while the majority of organisations that we surveyed offer medical (81%), life (67%) and travel (55%) insurance across all regions, 41% are offering different benefits depending on the country or region.
This illustrates the level of complexity that multinational companies face when administrating benefits globally, and makes a compelling case for creating a global benefits strategy.
Creating your global benefits strategy
Process of developing a strategy begins with the right team, which should comprise, ideally senior, representatives from HR, legal, finance and risk management, and where possible, from the organisation’s global business units.
Their role is to develop the global benefits policy statement, the blueprint for programme design and key to aligning all global programmes with the same shared objectives.
Flexibility is an important factor in meeting the needs of different employee demographics in diverse locations, and this should be reflected in the benefits strategy. However, our own research found that only 15% of global companies currently offer flexibility over the choices and level of benefits they have in all locations.
The benefits policy statement must also support the organisation’s business, HR and Total Reward/benefits strategies. Current benefits need to be assessed and revised accordingly, which means designing company-provided benefits programmes that complement the government-mandated programmes and are also aligned with the global benefits policy statement.
For the implementation phases, to put the benefits programme into practice, work with key local and global providers to develop and implement plans for communicating and administering benefits, and ensure you have adhered to tax and regulatory procedures.
Programmes should be evaluated and assessed on a regular basis to ensure continued competitiveness with local practices, and continued compliance with changes to local legislation.
Measuring the success
A global benefits strategy needs to be effective and flexible, but it also has to be measurable. Our research found that almost two thirds (62%) of organisations use employee engagement surveys to measure the effectiveness of their benefits strategy – a good starting point, but probably not that effective on its own.
More than half (56%) use staff turnover figures, while one in four are not measuring the effectiveness of their benefits strategy at all.
And although recruiting and retaining talent is a top priority, only 26% are using their recruitment statistics to measure the effectiveness of their benefits strategy.
We know from our 2014 Global Employee Benefits Watch research that organisations are making gradual changes and shifts to their benefits plans in a way that addresses the challenges of globalisation.
Overall, 57% felt that their global benefits strategy is effective in meeting their objectives, with US HR professionals being more confident (85%) than other regions and APAC being the least confident 52%.
Getting their benefits strategy right gives organisations a huge advantage when it comes to attracting and retaining high calibre talent and maintaining high levels of employee engagement.
By raising awareness of the challenges they face, we hope to see organisations being more proactive in the way they address these challenges, and creating winning benefits strategies that will deliver ROI and accelerate global business growth.