Organizations deploy total rewards programs as viable entities to boost employee motivation and retention in existing job positions. Workers see appraisals and overall rewards programs as the employer's way of recognizing their accomplishments at work. Companies are also cautious when it comes to meeting employees' basic needs. The basic goal of total rewards programs is to create a work environment that can recruit, motivate, and retain people with high levels of competence (Bolton, Kannan & Bramlett, 2000). As a result, the emphasis on vision-driven firms must shift to comprehensive incentives programs in order to attract people who can contribute to the professional labor market requirements. Therefore an organization must be cautious while designing the total rewards program since the program would be used as a resource by potential candidates for apprehending the probabilities of their professional growth with the organization (Davich& Peters, 2013). Alternative financing enterprises such as Express Financial Solutions also have to implement the total rewards programs and look after the needs of all categories of employees.
The following report provides an outline for developing a total rewards program for the EFS through a subjective illustration of the organization's key goals, competencies, challenges, and values required for success. The report also indulges in the evaluation of the existing total rewards program philosophy of Express Financial Solutions to derive plausible recommendations for changes in the program and the different steps in which the strategic TR program can be implemented (Haider et al., 2013). Furthermore, the discussion on the validation for changes introduced in the program and metrics for determining the efficiency of the changes in the total rewards program facilitate a reasonable impression of the significance of these programs in the development of organizational performance.
Organization Background
Express Financial Solutions is a small alternative financing company which provides capital assistance for small and medium business firms in U.S. and Canada. The organization’s vision statement is directed towards support for customer, support for employee and support for everyone. EFS have the mission statement to assist small business owners in America to develop their business with the assistance provided by EFS in the form of working capital (Hirst et al., 2005). The strategic objectives of EFS are inclined towards increasing profits, the transformation of partner channels, completion of system and process infrastructure and balance sheet restructuring.
The capabilities of the organization are noted in the four profound pillars of creativity, collaboration, innovation, and leadership. These pillars are responsible for the sustenance of EFS in the domain of alternate financing which requires comparatively higher degrees of differentiation. EFS also requires accomplishment of complete automation of the underwriting funding and decisions at the end of 3rd quarter and acquire market leadership in the domain of alternative financing(Kaplan, 2007). Furthermore, the requirement of competencies is catered by the organization through the elements of innovation and quality. The competencies are used by the organization to stand out of the competition and demarcate itself from the competition in alternative financing industry. Express Financial Solutions relies on its competent ideologies to derive a competitive edge in the marketplace through the establishment of quality.
The organization can improve quality through cognizable developments in performance, innovation and reliability and EFS have the necessary research and innovation systems in place for addressing the quality improvement needs. Provision of flexible access to customers through the institution of a client portal system can also be accounted as a formidable example of the competence of Express Financial Services. EFS can utilize these competencies to frame plausible opportunities for fulfilling organizational goals such as the provision of lending to almost more than 50% clients and the generation of revenue through third party products (Hirst et al., 2005).
The value framework of Express Financial Services is associated with consideration for culture, objectives and core challenges as well as competencies in every team within the organization (Haider et al., 2013). The needs of employees in individual teams within each department have to be addressed imperatively by the assessment of prospects for the total rewards program. The recently observed issues in the organization pertaining to the incentive plan for underwriters are reflective of the significance of underwriters and the needs to revise their incentive plan in the total rewards program.
Existing Total Rewards Philosophy of EFS
Total rewards program provided by Express Financial Services include monetary as well as non-monetary rewards for employees. The organization’s inherent belief in providing success for customers, employees and the organization is indicative of the emphasis on concerns of all employees irrespective of their role in the organization (Davich& Peters, 2013). Communication flows throughout the organization extend from employees to executives. Therefore the existing total rewards philosophy of Express Financial Services is inclined towards investment in employees.
The inherent motivation for the program is the organization's commitment to improve the work-life balance of employees and to address their plausible needs. EFS can accomplish feasibility in its total rewards program through investment in technology and human resources to improve the overall experience of customers as well as employees. A total rewards program is characterized by the essential elements of pay benefits, leisure benefits, and benefits for learning and professional development. The monetary incentives facilitated by Express Financial Services to its employees are noted in the form of fair basic salary for the employees and commission for underwriters on completion of corporate lending contracts (Bolton, Kannan & Bramlett, 2000).
The benefits of leisure and life provided by EFS comprise of essential references to the vacations, holidays and sick pay provided by the company to its employees. The provision of support for short-term disabilities of employees is also included in the total rewards program of Express Financial Services which can cater the exigency situations of employees unable to attend work due to medical illness and temporary disabilities (Davich& Peters, 2013). The claims of the organization to have provided substantial investments in the total rewards program for employees have been refuted by the recent survey.
The observation of notable fallacies in the rewards program was identified through the survey of 15 employees of Express Financial Solutions which profoundly indicated that the employees perceived insufficiency in the reward program. Therefore, EFS needs to revise its total rewards program through apprehension of the different aspects of a total rewards program and emphasizing on supporting entities such as workforce segmentation and illustration of existing competencies of the organization. These reviews could be helpful in drawing recommendations for changes in the total reward programs facilitated by EFS alongside providing validation for the recommendations.
Workforce Segmentation
The process of workforce segmentation is ensured through the evaluation of roles which are critical to an organization. The existence of numerous departments within an organization requires the classification of employees into different segments. Workforce segmentation is practically reflective of the similarity of requirements and characteristics of employees (Haider et al., 2013). The segmentation has to be supported by the design of human resource strategies tailored to the distinct needs and characteristics of an organization. In case of Express Financial Solutions, workforce segmentation is based on value creation wherein the employees are categorized into three groups.
The three groups include legacy drivers, performance drivers and performance enablers. Performance drivers comprise of executives responsible for management and guidance of employees, and therefore performance drivers are subject to rewards in the form of personalized compensation package tailored specifically for their requirements.
However, the recently observed issues in the context of Express Financial Services indicate the flaws of the value-based employee segmentation for total rewards program design. Therefore the emphasis on role based contributions of employees for determining rewards for the different levels of the organizational hierarchy has to be adopted by EFS to consider improvements in its total rewards program (Hirst et al., 2005). Perception of disparity in total rewards program outcomes for different value based categories of employees could be noticed as a prominent factor for the dissatisfaction of employees with the program.
The organization provides similar pay benefits and increases for mid-level employees or performance enablers which is also a plausible indicator of resentment among employees who prefer incentive plans, improved healthcare benefits, increase in financial remunerations and depiction of steady work in a flexible schedule.
Required Competencies
The organization has sustained in the domain of alternative financing with the capabilities such as multiple financing solutions, flexible provision of funds, customer loyalty, speed in the process and providing a turnaround time of 3-7 business days. Express Financial Services has access to core competencies of innovation, creativity and technological expertise to improvise on measures to improve the total rewards program and resolve the issues of an unfavorable incentive plan for underwriters. The availability of technological competence enables the organization to provide alternative financing services flexibly to its customers which are also accounted as one of the renowned characteristics of the company to separate it from the other competitors (Haider et al., 2013).
The concerns for insufficiencies in the total rewards program can be revised with the observation of technology’s implications for Express Financial Services and its operations. The foremost benefit which EFS can draw from its competencies is the use of technology to allow its customers and patrons to access financial services and their accounts at any time. The personalization of services is accountable for induction of promising customer experience traits thereby sustaining long-term prospects for productivity.
Customers are provided with appropriate support in certain applications such as early payment of loans. Furthermore, the communication competencies of the organization are profoundly observed as plausible requirements for improving the total rewards program (Davich & Peters, 2013). Acquisition of customers on the basis of technological competence and sustaining customer retention rates could be helpful for Express Financial Services to improve revenues and thereby cater the requirements of the higher basic salary of different employees.
Furthermore, the innovation and technological competencies of EFS can be capitalized upon to derive monitoring frameworks and systems which could be used for estimating the performance and improvement trends of employees (Feidelson et al., 2002). The statistics obtained from such evaluation could be formidable contributors to the estimation of potential suggestions to improve the outcomes of total rewards program on employee productivity.
Therefore the essential competencies which can be observed as formidable requirements in the case of Express Financial Solutions include customer-oriented strategic approaches, effective team builders, limitation of insufficiencies in communication, risk assessment, time management, identification of problems and formulation of remedial strategies as well as decision making and prioritization of objectives. The role of effective team builders would be required for providing appropriate recognition to the performance of employees and instituting a difference from the conventional value-based estimation of roles. Clarity of communication is necessary for improving the efficiency of total rewards programs as certain employees are unaware of the long-term implications of the facilities provided in the total rewards programs (Hirst et al., 2005). Therefore, EFS has to implement formidable communication systems for the purpose of communicating the program’s comprehensive information to employees alongside providing a promising infrastructure for monitoring the performance of employees through direct reporting and feedback mechanisms.
Assessment of risks is a noticeable competence required for Express Financial Solutions owing to the volatility of economic environments on a global platform and the provision of total rewards programs require the investment of substantial working capital which could be otherwise utilized for contingency scenarios such as financial crisis. Time management and prioritization of objectives are necessarily influential on the effectiveness of total rewards program implemented by Express Financial Solutions. Time management would enable the management to ensure limitation on delays in the provision of incentives and remunerations alongside the prioritization of objectives (Katz & Green, 2009). Prioritization enables the employees to understand the specific objectives which they have to complete to accomplish the objectives. Therefore the observation of required competencies from employees of Express Financial Services can be used to design the total rewards programs which would facilitate prolific monetary and non-monetary incentives for the accomplishment of specific objectives (Walker, Jindal & Weir, 2002). The provision of appropriate commission for underwriters in incentive plan as well as improvement of pay scale and benefits accordingly are prominent outcomes for the total rewards program of EFS.
Recommended Changes
The changes which are required in the total rewards program of Express Financial Solution are imperative in the event of the existing and future challenges for the organization. The performance in the domain of alternative lending industry is predominantly influential in favorable as well as challenging economic environments. However, the significance of negligence for past market behavior depicted by firms is perceived as a major setback for EFS in its total rewards program. Therefore the organization has to apprehend the interplay between past, existing and future issues associated with the organization. Existing challenges for EFS are prominently indicative of the requirement of methods for acquiring capital from investors to support the lending activities.
The need for acquiring capital from investors is observed prominently in the increasing competitiveness of other assets by risk return. EFS also face the challenge of improving the flexibility of operations by obtaining diverse liquidity options. As compared to the existing challenges of capital and liquidity option requirement, the future challenges posed for Express Financial Solutions are derived from the entry of new leader in the domain of alternative financing. Therefore, the organization needs to revise its strategic approaches including its total rewards program which could be a substantial contributor to the promotion of employee productivity.
The total rewards program is suggestive of six essential elements which include compensation, benefits, work-life balance, recognition, talent development and performance management in an organization (Katz & Green, 2009). These elements have been generically categorized into three basic categories which indicate the benefits for short term, benefits of leisure and services for life and benefits of learning and development. The existing total rewards program provides monetary as well as non-monetary benefits with the latter being in higher proportion.
The proposed changes to the total rewards program have to be represented in the context of the challenges for the organization in the alternative financing industry as well as employee’s perception of the existing rewards program. It can be imperatively observed that Express Financial Solutions does not cater the demands of its employees and the claims made by the rewards system of the organization for comprehensive attention to the well-being of its employees are found to be false to a certain extent (Hirst et al., 2005).
The firm is not able to provide an adequate percentage of commissions in benefit packages for underwriters, and the packages are ambiguous regarding the healthcare benefits. Therefore this shortcoming in the rewards program of Express Financial Solutions can be considered in violation of legal obligation of the organization to look after the security of the organization especially in the event of economic uncertainty. The allowances for parking and commuting have to be improved depending on the distance of the residence of employees from the organization.
The coverage for disabilities has to be revised according to the survey findings. Employee benefits are substantial contributors to the development of motivation and can be productive regarding developing employee engagement thereby resulting in provisions for optimal revenue generation (Katz & Green, 2009). Another prominent change which has to be implemented in the total rewards program of EFS is the improvement of health insurance benefits. The estimation of health insurance benefits has to be derived from the financial responsibility expected from employees according to the job categories could be a plausible change in the total rewards program for Express Financial Solution.
Justification for Recommended Changes
The improvement in basic employee benefits as a part of the total rewards program can be assumed as prolific changes as per the recommendations. The significance of the individual employee benefit packages in the total rewards program can be assumed as an appropriate justification for the recommendations. Changes in employee compensation would be inclusive of replacement income, and the employees of EFS have to be eligible for the benefits owing to the multinational nature of the company.
The unemployment insurance added in the total rewards program must be referred to as an insurance provided by EFS to its employees. This initiative is particularly favorable for employees in the alternative financing industry which are subject to consistent fluctuations in economic environments putting the jobs of employees in EFS and peer organizations at risk. As discussed above, the inclusion of emphasis on healthcare-related benefits such as disability insurance and healthcare insurance are perceived as major factors for satisfaction in total rewards program of Express Financial Solutions.
Risks and Opportunities
The prolific risk of refraining from implementing the recommended changes would result in detrimental consequences for Express Financial Solutions. The stalling of increase in basic pay and benefits of employees could lead to dissent and thereby reducing organizational productivity. The risk associated with the negligence for healthcare insurance and benefits for employees in the total rewards program would be indicative of a gradual reduction in employee loyalty and deviation of EFS from its traditional values and beliefs.
On the other hand, the opportunities which can be garnered from the program include the development of interpersonal relationships between various teams in the organization and increased focus on professional learning and development.
Metrics for Evaluating
Metrics can be described as the key instruments for measuring the performance of specific activities and projects. The different types of metrics which are used for assessment of a total rewards program include qualitative and quantitative methods. The metric used in this report is a qualitative metric of climate survey.
The selection of the climate survey metric can be validated by the comprehensiveness of information which can be acquired in the method. The process outcomes reflect on the perception of an employee regarding the various dimensions of an organization, and hence it can be validated as a suitable metric for this report. The outcomes reflect on the employee satisfaction rate with the different aspects of the total rewards program.
Conclusion
The report emphasized on the critical review of the applications of total rewards program for Express Financial Solutions, an alternative financing multinational corporation. The evaluation of total rewards philosophy and existing programs implemented by EFS was reflective of potential outcomes such as recommendations for changing the organization’s total reward program. Illustration of appropriate justifications and metrics for evaluating the efficiency of recommended changes were also provided for improving the report’s credibility.
References
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