Designing a perk is an exercise. In the minds of employees, perks serve as a significant differentiator between companies.
It is wrong to believe, that employees are ever willing to switch to a new job if offered a better pay package. Does that imply that employees stay put with a company for reasons beyond just the monetary benefits? It sure does.
The culture, co-workers and growth prospects are significant propellants for employees to extend their stay in an organisation. However, amongst all these motivating factors, there is one called ‘perks’. Employees’ passion to work is enhanced by the offer of perks, which are a way of telling employees that the organisation cares for them.
Companies have been using innovative perks to keeps the employees engaged, happy and satisfied. For instance, Google offers some great death benefits, wherein the spouses of the deceased employees receive 50 per cent of their salary every year, for a decade, in addition to a $1,000 monthly payment for their children, until they reach 19.
Such a perk goes a long way in letting the employees know that the company really cares for them and the well-being of their families. This creates a huge goodwill.
Perks can also be construed to be subtle signals about a company’s culture. For instance, for the aforementioned perk at Google, there is no tenure requirement. Current and prospective employees will see this as an extension and reinforcement of the company’s belief in flat hierarchical structures.
SAS is another company which offers attractive benefits to its employees, ranging from three weeks of paid company vacation and unlimited sick leave to subsidised on-site child care centres and college scholarship programmes for the children of employees.
SAS believes that people stay with the company because of the benefits, and because they feel they are seen, attended to, and cared for.
“Perks act as a vital hygiene factor and contribute to a strong employer brand. With the ubiquitous social media spotlight on companies and unprecedented sharing of employee experiences on the Internet, perks have become more important than ever before — both to attract and retain talent,” says Ruchira Bhardwaja, CHRO, Future Generali India Life Insurance.
People share their experiences and compare notes on social media. Just like the bad experiences of employees, with a particular company, spread like wildfire —as it happened in the recent case of Amazon — a positive word-of-mouth about employee-friendly perks also gets shared. If this is done consciously by a company, the news goes viral and turns into a powerful tool for attracting the attention of passive talent too.
Designing a perk is not just a random exercise, nor can it be copied. In the minds of employees, perks serve as a significant differentiator between companies.
“A strong focus on perks requires an unwavering backing of senior HR and business leadership. They need to be personally certain and convinced about the value addition that perks will bring to the table,” says Bhardwaja.
“There is a need for a differentiated approach towards perk planning on the basis of the generation of employees. In addition, personalisation within those baskets of perks is the right approach towards ‘perk management’. Perks should address the strengthening of causal factors that can help in increasing the net worth of an employee,” Vinay Jaswal, V-P HR, InterGlobe Hotels.
For instance, with the increasing number of millennials in the workforce, perks need to be designed accordingly. Gen Y youngsters are excessively individualistic and prefer flexibility. Hence, a personalised approach to perk design is highly appreciated by this segment.
Financial bonus, paid sabbaticals or electronic gadgets — to each their own. What they want is variety and the power to choose.
“For new-gen employees , any perk that gives them an edge with respect to peer status and career advancement is always a winner. Thanks to a heavily networked environment , they have a clear idea of the fair worth of their competence. Therefore, they prefer perks and rewards that directly help enhancing their net worth —skill building, cross-functional opportunities, inter industry exposure—rather than mere increment in their compensations,” asserts Jaswal.
“Perks need investment and may have intangible, non-measurable benefits which might reveal themselves only in the long term. Hence, it is easy for leaders to fall into the trap of misinterpreting them as mere cost implications,” concludes Bhardwaja.
With careful design and rock-solid intent, perks can serve as powerful tools to attract and retaining talent, and also create a positive workplace culture.