LEADERSHIP UNA DIVER
HR shape the next normal Una Diver, Partner at Ernst and Young, provides insights into how organisations are refocusing their remuneration strategies as they look to the future.
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ew Zealand is in a different place from what it was a year ago. We’re moving away from risk management toward a new optimism, with most pundits generally predicting a continued recovery and a buoyant economy. The growing pains associated with this resurgence offer a new set of challenges to be negotiated by organisations and their HR functions.
organisations to reimagine their workforce for the future.
Remuneration budgets – a war for talent in the engine room of companies During 2020, almost a quarter of organisations either cancelled or postponed their annual remuneration reviews.
However, that was then and this is now. Our latest COVID-19 Pulse Survey (July 2021) indicates that most organisations are going ahead with their annual reviews as normal across all levels and roles, reflecting
a return to a degree of ‘business as usual’. Of these, only 1 per cent of organisations anticipate having reduced remuneration budgets this year. While many organisations are increasing remuneration budgets, a shift in spending patterns is occurring. Consistent with the competitive talent market, more organisations are increasing remuneration budgets for roles below the executive or senior management level. This concentration of spend in the ‘engine room’ of organisation
Our experience suggests that companies operating a ‘back to normal’ approach will either miss the significant opportunity to transform or face ongoing people challenges. Organisations that grasp this opportunity will not return to normal but will reframe what normal should be. HR functions have the potential to be central to realising this transformation. As difficult as the COVID-19 pandemic has been, the disruption presents an opportunity for Annual salary review intentions (Source: Ernst and Young COVID-19 Pulse Survey July 2021) 34
HUMAN RESOURCES
SPRING 2021
