White Paper: Embedding Total Rewards

Objective: To achieve properly embedded, highly efficient, and engaging Total Rewards Programs as a competitive advantage, helping to drive long term sustainable and profitable growth the Nestle Way

The premise is a continuing cyclical journey of preparation, execution, and ongoing management refinement. There is always a new reality to face and we need to be open to change.

What Is The Measurement to Get There? - Maturity Profile

At the ultimate level of success, we would say that such embedding would be achieved if the Market has reached level five as defined in our Maturity Profile:

  1. Design of the local Total Rewards is continuously looked at and validated via consumer insight and market data through all employee segments ensuring the optimization and value for employees and the business. Flexibility is offered where possible, but builds upon foundational rewards that are necessary such as medical benefits or life insurance etc. The market has a strategy in place and will, step by step, enact that strategy until reaching an ‘advanced’ level in alignment with the Nestle Total Rewards Tool Box, outlining the strategy of embedding the NTRP within the market.
  1. Nestle and I survey results have the highest score for reward and recognition, and other elements of the local markets Total Rewards.
  1. There is an ongoing communication strategy in place that continues to tell the story via different employee segments of the Total Rewards journey and employee life cycle (on boarding, life events etc), creating a high level of appreciation for the rewards received: Outlining and communicating the commitment and plan of the market . Employees transparently understand the rewards that they receive: what they mean to them, the reason for where they are in the position of their total rewards, and the evolving direction of where the market is going. The market has Total Rewards statements that are executed in an efficient and timely way, giving fully transparency and understanding of each employee’s respective elements that make up their Total Rewards. Associated materials of communication have been appropriately customized, are transparent and are available to the appropriate employees segments. As much as possible, the communication is simple, leveraged and connected.
  1. Line managers, HRBPS and COEs are ambassadors of the local Total Rewards policy and have empowerment, tools, means and understanding to effectively communicate the policy to employees on an ongoing basis after the initial launch. Such capabilities would be, though not exclusively, regular update meetings on the status of Total Rewards progress, explanation of terms and content of the local policy, systems capability and confidence to interact with employees, or explanation and reason for any changes in the Total Rewards design.
  1. The local Total Rewards policy is fully in alignment with the NTRP and governance issues. There open communication channels with union councils as well as regular meeting with GMB/RMB to ensure NiM collaboration, alignment, coordination and transparency. Roles and responsibilities of all governance participants are clarified. A yearly report is given to the Market ManCom on the status and progress of Total Rewards with an outline of the strategy of the upcoming year and years. Cost management issues of NTRP are integrated with MOGE control initiatives. Simple, leverage and connected IT system tying all HR areas of expertise together in a complete integrated system, thus allowing a complete Total Reward s view and strategic approach via:
  • C&B ‘s understanding of the key talent and the approach from a Total Rewards perspective to insure a high placement of such talent in the upper quartile of rewards where it makes sense
  • Transparency of performance over the life cycle of the employee
  • Readily visible training history of employee and established development plans be available to the line manager to discuss with employees at a touch of a key if require.
  • Career path profiles
  • Ability to create branded and complete Total Rewards statements, on paper as well as having access to online statements as a means of also having a dialogue between the line manager and the employee.
  • Ability to automate payments of bonus, with clear and transparent explanation of calculation, in alignment with PE bonus-able achievement and collective targets whatever the mix might be
  • Integration of LTI if applicable in the Total Rewards profile of the employee for COE and line manager for her respective team
  • Easy to use and clear to understand
  • High level of security approved by Globe
  • Cost management integrated to alignment of budgets with current status with full reporting, and a capacity to see in a real time basis where the market is versus their MOGE target and or budget approved
  • KPI driven to ensure efficiency and performance and acceptance of the system with respect to timing of data, accuracy of data, total cost of rewards per employee as a % of profit per employee etc.
  • Capacity to update the system based on advances in alignment technology on the HR system where it makes sense
  • Employee branding an key point messages to be current and continuous within the system
  • Feedback mechanism for line managers and employees to ensure improvement of the system
  1. There is a strategic recognition program and a culture of recognition that is easy to implement, timely and is measure to improve engagement
  2. Recognizing and rewarding behaviours that reflect our values and principle
  3. Empowering employees to notice and appreciate colleagues who demonstrate the values and principles
  4. Measuring and reporting on results, identifying underperforming areas of recognitions and intervening with additional training
  5. Fulfilling NCE requirements of recognition
  6. Is frequent enough to reach the tipping point of employee recognition, touching 5-8% of employee on a weekly basis.
  7. Strategic in its ability to extend the recognition moment, is budget bases, KPI driven, results focused
  8. Has the capability to integrate mobile technology and leveraging recognition across social groups
  9. Has the capacity to integrate recognition as an additional consideration and feedback of performance from the social network as complimentary input for Line manager.
  10. Has the capacity to be rolled up to give executive insights on recognition and it tie to business results

Elemental Success Drivers: In order to reach the optimal level of excellence it is important that we have:

  1. A prioritizedalignment with the Nestlé Group Business strategy within the HR Leadership Team and our C&B Roadmap

  1. An understanding of integration and connection that we cannot have ‘a solution’ that solves just one problem and not all the others in the puzzle. Any 'solution’ that attempts to solve one problem ‘in isolation’ and which is not a complimentary leveraging solution to other dimensions of the picture is limited in intelligence: a partial brain and not a complete one. We must begin to think in a simple, connecting and thus leveraging manner. Our solution in the NTRP, within all of its interdependent elements, must be a solution of the virtuous circle[ko1], of cost management, of Nestle in Society, of efficiency, of employee’s aspirations, of recruitment, of engagement, of fun, of everything - leading to an enviable competitive result/ solution of long term, sustainable and profitable growth the Nestle way. The fewer the simple and leveraging connections, the lesser the chance of success.
  1. The belief in the importance of developing a highly capable NiM C&B Manager to implement the strategy. The arrival of which faces the following possible challenges
  2. Strategic results can be achieved with a capable NiM C&B manager leading the process. The statement ‘We believe in the importance of C&B, but anyone with leadership qualities and a good intelligence can do the job, is participating in a downward spiralling belief.
  3. We need to recognize the dynamic environment and nature of the C&B/ Total Rewards function which continues to become more complex requiring cost effective financial , communication, IT, engagement, organizational effectiveness, business concentric, change management, and functionally advanced strategies that are all aligned and connected within a complete and holistic Total Rewards/HR strategy (see Roadmap)

Still, we must continue to show commitment and patience in developing current NiM C&B managers in the role who, with the right support and directions can evolve into the level of C&B professionals we dream of, can become strategic contributors who are ‘great at the game’.

A high amount of attention, however, must be given with new openings, to not use this role as a means to try to create C&B Managers from ‘scratch’ with no experience, for such events delay the development of the C&B Function within the Group. The Group’s creation of the job success profile should be the governance to ensure that this does not occur.

  1. A commitment to communication and appropriate transparency as a foundational building block of value and an enabler of the right message to the right community bearing the right validated result. Many within Nestle experience this frustration
  • An investment into a diamond, not properly displayedwill fundamentally be overseen as a less valuable stone. We potentially waste millions of dollars on benefits not valued because they are not properly ‘cut’ nor properly polished. Just as we productively spend millions on packaging of our products, for our consumers, we need to spend a fractional amount on effective mediums and methods of targeted communication: 60-40 preference, PPP, branding the Nestle Way, are all well understood dictates of practice that should equally resonate in how we approach, research, and offer our Total Rewards. There is a fundamental need of highest value, to communicate well what we have. It also ensures that what offer does have value because you cannot ‘sell’ what is not there.
  • Transparency is also an element of communication that needs to be based on the maturity of the organization more and more aggressively pursued, to ensure a clearer understanding of the rules of the game, and thereby a greater appreciation of value based on an understanding of those rules. Silence is always treated as an ultimate value destroyer and disintegrator of trust.
  • Creating a greater capacity for communication within professional networks to enhance faster evolution and idea creation depending on flowing data, self correction mechanisms, wide-bandwidths of information, a story that celebrates both failure and success, and a psychological contract of trust that empowers employees (us) to open up and share without fear of repercussion or shame.
  1. A strong capacity for flexibility/adaption with a strong pull towards evolution and maturity
  2. That we align stages of maturity and tools tied to those levels of strategy to assure a not ‘one size fits all’ approach, and understand the uniqueness of markets and how different cultures bring different opportunities of optimization.
  3. But that even with the uniqueness of markets, there is commonality of what are the steps and process to understand where you are and how to get to the evolutionary journey of best in class.
  1. A reliance/requirement on analytics, sound scientific researchtools and real time flowing data – to know where your are, and where you need to go investing in value buildersand avoiding and eliminating value destroyers
  2. We begin to understand the importance of real-time analytics not only in the creation of modeling of new ideas, but in the avoidance of ‘pain’.
  3. This means real time awareness of such things as cost within Total Rewards, of those who are working overtime in conflict to acceptable maximums, of status of economy and economic indicators, of who is being recognized and who is not, of what behaviours are being appropriately recognizes and what are not, the warning bells of high performers in position within low salary ranges, the pulse and dialogue within the social network, the discovery of innovation from the bottom up: All deepens and compliments multiple strategies with real time data and capacity to immediately interpret this data. In the realm of human biology our brains and our nervous systems automatically do this daily: The ultimate example of how analytics can functioning well within a ‘business’ - We live, we don’t breakdown, take on illness and or constantly operate in a state of sickness and immobility, but we function in a state of optimum performance and mobility allowing us to move, react and take advantage of a world of opportunities.
  4. KPIS to truly measure where we are versus where we want to be – and a governance and means to immediately respond to unacceptable and critical situations. The definition of human rights within Nestlé is the avoidance of that which can cause harm to the company. The greater the delay of awareness the greater the harm. Through the constant measuring of our current statewe have a better chance of avoiding such harm in the living out of our Total Rewards.

We accept the importance of this within our manufacturing model – with the detection of foreign, objects, metals etc, and the means with which to correct, but we have yet to understand within our HR communities how analytics can prevent game stopping threats, as well as discover game changing innovations in the areas of Total Rewards as a competitive advantage. Within the elements of Total Rewards we stand on the union of all specialties within HR (MD, Recruitment, Training, Pay, Human Rights, Labour Relations Gender Balance, Pay for Performance, etc.). Isolation and absence of connecting data between these specialities makes the connections impossible. Without awareness we are in harm’s way.

  1. Push and Pull- What do we dictate from the top down, and what to we achieve by our customers demanding it.
  2. Push:
  3. Systems, once evaluated and co created within the HR community, like the NTRS, need to be a top down mandate for all to have and use. If it is decided we will use a phone system to communicate, and the ‘other side’ does not buy a phone, no communication will take place. If we determine to create a common NTRS, and the specifications are decided, then it must be a Push, top down mandate that all use the same system. Otherwise the capability connection, of integrated solutions, of streaming analytics, the ability to determine efficiencies, and competitive cost management opportunities, a view not only for the market but the Group, is not possible and ‘no communication takes place’.
  4. That we push certain common methodologies and understood disciplines in discovering the best ways to determine, effective communication, cost effective rewards, strategic segmentation, recognition, considerations and systems of change management: But that based on maturity of the market there would be a ‘Pull’ of timing and a pull of cost of when it is best to eventually implement the methodology and practice.
  5. That we ‘Push’ the requirement of integrated and connected solutions
  6. That we ‘Push’ the need of emerging market in alignment with our Group OMP to actualize and speed up the advancement of the embedding of an effective Total Rewards strategy and the great return it brings.
  • Pull:
  • That the markets, based on the attraction of the solutions, processes, methodologies, offered and examples of success of other markets who are following and using them, have the freedom to choose - To ‘Pull’ off the shelf the integrated solutions and tools that they feel are most useful for them, but that also fulfill the defined ‘push’ requirements.

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  1. Attention to growing compliment between the individual and the social network using the axis Individual, Collective, Collaboration and Performance
  2. The conventional model is that performance stems from one individual and evaluated by one direct boss
  3. The evolving model is the social network where performance is more interdependent with an awareness of the individual and ‘conscience’ of the ‘team’ to both contribute and to recognize and calibrate evaluate performance of individuals within the team and the team as a whole. Nestle on the move and ‘Dynamic Rewards’ is a full explanation of this move.


Tool Kit:

In order to reach this level it is agreed that we need to develop a Total Rewards Embedding Tool kit

  1. Tool Kit will be in alignment with all of the above
  2. Business Strategy (MBS), HR Key Priorities and C&B Roadmap
  3. An understanding of connection and integrated solutions
  4. Capability of NiM C&B Managers
  5. Communication and transparency
  6. Analytics and sound empirical research
  7. flexibility/adaption with a strong pull towards evolution and maturity
  8. Push and Pull
  9. Attention to growing compliment between the individual and the social network
  10. Will focus on
  11. Working with the Corporate Leadership Council to map out the maturity profile-job success profiles to determine and discovers paths of best practice, and then the connections of Level 3 to Level 5,with initial focus on the emerging markets taking into account all of the major project components of the C&B OMP
  12. With a leading communication consultantas a result of a Request for Proposal (RFP) working with developing markets, who understands the white paper specification identified above, and achieve
  13. Primary objective of establishing the framework and design of good communication model and how best, without changing anything in benefit design, begin to effectively make known the rewards that each market has and then to work towards an advance state
  14. Secondary objective of defining the basic foundational elements, processes and analysis tool from the CLC mapping and their own consulting practice in order to properly present and package them so that emerging markets are on the right path towards establishing and embedding foundational practices for Total Rewards
  15. Third Objective – A detailed project plan for targeted emerging markets to go through the Change management, resource planning process of ensuring that this occurs for the evolving markets (Pareto Principle 80/20 – Focus on 20% of overall markets can bring in 80% of the impact). Agreement with those markets of what they can and cannot do based on budget and resources
  16. Simultaneously, will take the 5 key projects as defined in the Road Map and with the attention of the white paper, define and catalogue in a more collectively package manner, what ‘tools’ are already there following common structural approach of