It’s been 15 years since the American Compensation Association changed its name to WorldatWork, reflecting the group’s decision to increase its footprint beyond the world of compensation and embrace a broader total-rewards approach.
This year, the Scottsdale, Ariz.-based HR association celebrates its 60th anniversary. And with that milestone comes a revamped total-rewards model.
Announced during the opening session of this week’s WorldatWork’s Total Rewards 2015 Conference and Exposition in Minneapolis, the new model now includes the verb “engage” (which joins attract, motivate and retain in describing total rewards’ contribution to the organization) and the addition of “talent development” as a sixth element of the total-rewards strategy.
WorldatWork’s previous model, introduced in 2006, featured the following five elements: compensation, benefits, work/life, performance and recognition, and development and career opportunities.
Anne Ruddy, president and CEO of WorldatWork, noted that the time was right for the association to re-examine its total-rewards model and make it more relevant to the kinds of issues members are facing today.
Models aside, it would seem many of those attending this year’s conference have their sights set on the future. On Monday afternoon, I attended a packed session presented by Steven Gross, a senior partner at Mercer, entitled “Total Rewards 2020: What to Expect in the Next Five Years Based Upon a Lifetime of Experience.”
Five minutes before the session began, attendees were being turned away at the door because the room was already filled to capacity. (Fortunately, for those unable to attend, the session was scheduled to be repeated the following day.)
Gross, who is based in Mercer’s Philadelphia office, gave attendees a quick rundown of the external factors influencing total rewards today, a glimpse of what the future might look like five years from now and what steps employers ought to take to prepare for that world.
As might be expected, Gross led off his presentation by acknowledging the crucial role changing workforce demographics is playing in shaping the future of total rewards.
“It’s not only about people living longer, but people working longer,” Gross said. “Think about the implications of one quarter of folks over age 65 and 15 percent of folks over age 70 in the workforce”—and the kinds of challenges these changes are going to present to employers.
Generational differences, he said, are also likely to have an impact, as employers face the formidable challenge of addressing “the different sensitivities” of traditionalists, baby boomers, Gen Xers and millennials.
Other external factors Gross cited included income disparities, diversity, globalization and technology.
Gross predicted that, five years from now, companies will be much more focused on “core employees” who are viewed as being crucial to their organization’s success, will continue to put more weight on individual accountability, and will pay greater attention to personalizing rewards to reflect greater workplace diversity.
Going forward, he said, companies will also be much more focused on “best fit rather than just best practice.” (In other words, he explained, does your total-rewards strategy fit the culture of your organization?)
What’s more, he added, do-it-yourself benefits programs will be far more common five years from now, with self-service becoming an even greater fixture of tomorrow’s workplace. (Gross also joined the chorus of those predicting employers will increasingly be getting out of the “healthcare business.”)
I suppose we’ll know in five years which of Gross’ predictions were on target—and which ones missed the mark. But of this we can be fairly certain: Tomorrow’s total-rewards landscape isn’t likely to look anything like the one that exists today. As Gross reminded those attending his session, there are simply too many significant forces at work to ensure that that’s the case.Twitter It!