Reward Programs Misfiring

Performance Incentives: Rapid changes in the way business is transacted necessitate dramatic changes in how companies should reward employee performance. But HR consultants at Towers Perrin say most companies have not changed their base pay, incentive and performance management programs in years  to accommodate the seismic shift. The research is based on responses of 600 human resources and compensation professionals in 21 countries. Notably, 57 percent say their rewards strategies are intended to recruit top talent, while 73 percent hope to improve retention. Yet “few of the actual tactics they reported were consistent with this stated focus,” according to Towers Perrin. Also, 68 percent of organizations lack formal methods for determining the return on investment in rewards initiatives.