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November 10, 2008
Comp, HR Pros Struggle to Effectively Communicate Rewards
A new survey has found that 80 percent of compensation and HR professionals believe reward communication has an effective impact on an organization's performance, employee satisfaction, retention and employee engagement. Yet only 33 percent of respondents believe their company communicates its reward philosophy and strategy effectively to employees.

The study, conducted by Hay Group, WorldatWork and Loyola University Chicago also found that few companies formally evaluate the effectiveness of their rewards communications or pilot test their programs before implementation. But it found that those organizations that do evaluate and pilot test programs rate their programs as more effective than those that do not.

"Rewards programs are one of the largest controllable expenses for most companies, but most spend little time or resources evaluating program effectiveness or reinforcing its value with employees," Rich Sperling, a senior consultant with Hay Group, said in a press release. "At the end of the day, the investment in a solid communications campaign is minimal when compared to the investment a company makes in employee reward programs ­ and it can make all the difference. An average rewards program with robust communications tends to be more successful than an outstanding rewards program with poor communications."

Respondents to the survey identified total reward statements as one of the most effective methods for communicating about benefits as well as the organization's philosophy and strategy of its rewards program. However, total rewards statements were the least prevalent method used for such communications, with less than 70 percent of respondents reporting that their company provided them.

"While total reward statements are becoming more common, they are often not used to their full potential. These statements provide an excellent communications opportunity for employers to clearly explain their programs and strategies instead of simply offering raw facts," said Sperling.

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