Puneet is a Senior Partner and the leader of Mercer’s Career business for the International region covering Asia Pacific, Europe, Middle East, Africa & Latin America. During his more than 20 years of consulting experience, Puneet has provided advice to leading local and multinational organizations across more than 25 countries in Asia Pacific, Middle East & Africa.
Puneet has worked extensively in areas of talent management, HR transformation, rewards strategy, variable pay design, broad-banding, and job evaluation across industries. He has also advised organizations on HR audits, managing people issues in mergers and acquisitions, and compensation outsourcing.
Puneet is an experienced facilitator and instructional designer and designs and delivers HR workshops and training for clients
Before joining Mercer, he worked with another global consulting firm where he headed their broad-based rewards practice for South & East Asia. Puneet has also worked with ABN AMRO Bank in UAE where he was the Head of HR for their Consumer and Private Banking Business
Here are the edited excerpts.
How do you see the overall COVID-19 pandemic which has affected organizations across the globe? Can you share a few insights in terms of how businesses can move ahead post the pandemic?
Across the globe we are seeing employers and employees settle into a new way of working, the business efforts are starting to shift from a focus on business continuity to planning for the “return to work” and eventually reinvent themselves. During this period, companies must continue to provide support for their essential and remote workforce, while managing the impact of decisions such as layoffs, furloughs, and compensation adjustments. Understanding and balancing what this new normal looks like and how to support employees as we slowly shift back to on-site work needs to be a long-term focus. The key focus for every company should be how they balance economics and empathy. We recommend focusing on issues linked to three priorities - returning safely i.e. setting protocols, safety policies, business continuity plans, re-examining remote, flexible and blended working; returning to stability i.e., clarifying priorities and realigning to it, cost containment, digitization of work practices, basically using transformation as an optimization strategy; returning to energy i.e. supporting the mental, physical and financial well-being of employees, reconfirming the organization's purpose and value, designing an energizing employee experience. Overall we are seeing that companies are alternating between - respond, return, reinvent phases, what we call, our 'Three R' mode) depending on the course of the pandemic, government responses, and the resilience of their industry & business.
What's your advice on how should organizations streamline their performance management and rewards strategies during this crisis time?
Many companies are communicating to their employees that they are valued and important to the business, while also making rapid adjustments to goal setting, ratings, and rewards. In light of COVID-19, some companies may be considering extensive adjustments to performance ratings to trigger bonus payouts or other pay changes. For roles like sales and manufacturing, which have defined goals and targets, some companies are currently reviewing adjustments to account for increased or decreased demand due to COVID-19. Based on Mercer’s COVID-19 survey, those companies that are planning to make changes to their incentive pay are mostly revising metrics (54%), reducing thresholds (31%), and adjusting incentive target opportunity (31%).
In the current environment what remains crucial to organizations is to redefine their performance management strategy that encourages the right behaviors in the remote working world, delivers on investment and develops processes that result in desired business outcomes. Overall the long term view that organizations should keep is to deliver on the employee experience. At this time, performance management should provide:
- Alignment to shifting business priorities
- Prioritization of work that delivers the greatest value
- A focus on empathy, employee engagement, and providing support for employees
Aligning and engaging employees in the above areas will help produce the desired outcome. (refer to the data points above on changing metrics). How businesses respond to the crisis today will have a lasting implication on employee behavior – their ability to attract new talent, levels of productivity and engagement, and employee commitment.
What should be the differentiating factors in these times when almost everyone is contributing to his/her best and apprehensions, confusion and anxiety are all around? How to do expectation management in current WFH times?
Communicating the business priorities and set (reset) individual goals has never been more critical – just as business priorities and strategy have been upended, the employees will have been impacted both at work and at home. It is critical during this time to maintain regular contact with employees to share shifting business priorities and answer questions. While ensuring goal clarity is important for employees to understand how they connect to the overall business and make an impact, now is also the time to look more holistically at the goal-setting requirements to ensure that employee goals have a direct link to achieving business objectives, especially if they have recently shifted. Focusing on and helping employees with Mental and Financial Wellness is going to be critical in these times as well and leading companies are already hiring specialist companies to help individuals both on the Mental wellness side as well as financial management and cash flow planning as well.
In light of covid-19, some companies may be considering extensive adjustments to performance ratings to trigger bonus payouts or other pay changes. For roles like sales, which have defined goals and targets, some companies are currently reviewing adjustments to account for increased or decreased demand due to covid-19
Remote working became the new normal during the pandemic lockdown. What should employers keep in mind while revising the performance framework for their remote employees?
Two employees in the same job, with one working from home and one from the office, will perform differently. Therefore, they should have different performance goals and metrics for remotely working employees.
A few strategies that companies operating in a virtual or remote working world could pay heed to are:
- Communicate and keep in contact with employees about performance and overall well-being.
- Schedule regular check-ins
- Monitor outputs and impact to results
- Conduct regular employee pulse check-ins
- Ensure a strong focus on culture
Do you think employees will see their pay packets having a stronger linkage with their company's performance? How will companies ensure that?
Goal clarity has always provided employees with a sense of how they connect to the overall business purpose and make an impact. Show employees how their goals originate and feed into the business’ goals. Mercer’s own research (2019 Global Performance management Study) shows that employees want to work for companies that get to know them on a personal level and help them navigate their professional development journeys. Hence the connection continues and just the way the contribution is measured is evolving. Companies will need to align with the new rewards strategies emerging and accelerating in the new norm:
- Agile rewards - In the new world, work often happens outside of the traditional work model; talent might be borrowed on a short-term assignment; goals might be delivering a return much like a start-up; and team working and collaboration (not individual performance) are driving success. Here we’ve seen employees ask to share in the returns of new products being launched. And on the managers’ side, we’ve seen managers seeking to set rewards on a shorter timeframe to recognize contribution with the ability to adapt goals as priorities shift.
- Pay-for-skills - A hot topic has been the move away from traditional jobs towards skills clusters. And it is no surprise this is fuelling a debate around pay-for-skills. This might be about paying a premium for hot skills required in a position (i.e. be role-dependent), or this might be paying a premium for the skills possessed by the person (i.e. person-dependent).
- Personalized rewards - Finally, it’s not just agile working that is putting pressure on traditional and static models. In the era of the individual, there is the opportunity to involve individuals in how they want to be rewarded. This might be enabling individuals to decide how much they want at risk in their pay (being able to adapt their base and variable pay ratio, for example) according to their risk appetite. Or it might be trading pay for days’ leave and other benefits as part of a total reward strategy. Personalized rewards let people emphasize what they value – enhancing the power of this engagement lever.
Do you think the expectations of employees changed post-COVID-19 from their employers in terms of performance assessments and rewards?
COVID-19 has necessitated businesses of all sizes and industries to rapidly move to a predominantly virtual workforce. With fewer day-to-day touchpoints between managers and their employees, organizations are facing the need to develop new strategies for managing performance in a virtual world. As the pandemic continues, businesses need to keep in mind that employees are not only adjusting to new ways of working, but also dealing with increasing isolation from their extended support network, a halt to their normal daily life, and in many cases an increased need to care for their families.
Industry-wide pay cuts have sent several employees 2 or 3 years behind in their financial standing. How can organizations help employees navigate these challenging times while keeping their focus on business continuity?
Based on Mercer’s COVID-19 survey, 55 percent of companies have not made any changes to their salary increases due to COVID-19 yet and only 31% of companies have either implemented salary freeze for some or all employees. We see the majority of employers in Asia Pacific are protecting their employees’ income by retaining full pay for most of their salaried and hourly paid employees. With the unprecedented situation presented by the COVID-19 pandemic, organizations have been focused on the well-being of their employees and sustaining operations, and we are now seeing companies shift their focus on employee and executive rewards strategy – evaluating the new form of rewards programs in the post-COVID-19 environment. One thing is certain that compensation and benefits practices need to be re-visited and it cannot continue as usual.
Read more such stories from the August issue of our e-magazine on 'Performance and Rewards in the New Normal’