Xero’s largest cost is remuneration and reward and like most companies, Xero had never conducted a thorough review. Remuneration and rewards are most effective when aligned with employee priorities and Xero was fortunate to have additional budget this financial year to invest into our people in order to support our attraction and retention strategy. We wanted to ensure an analytical approach was taken and data was used to support our proposed approach.
The what, why and how
By launching a rewards optimisation survey the outcomes we were aiming to achieve through this research were to;
- Align what and how much we spend, with what employees value most and least across the rewards we offer or are considering offering
- Assess the return on investment, as well as the impact, by combining employee preferences with financial data
- Model various investment scenarios and decide how much to invest and where to get the best possible results for the smallest possible investment
- Use segmentation to understand the different priorities and attitudes of a multigenerational workforce and build a competitive edge in attracting, retaining and engaging top talent
- Increase insights to aid attraction, retention and engagement by providing total rewards that have the biggest impact on employee preferences
- Effectively tailor total rewards related communications to specific employee segments, regions etc
Ultimately, we were aiming for the initiatives coming out of the research to position us more competitively and contribute to an improved employee experience and a stronger value proposition. This will help us continue to attract, retain and motivate the best talent
What are the insights?
The Rewards Optimisation Survey was broken into different modules for each of Xero’s major regions. This allowed specific questions to be asked around certain benefits that might only be offered in a certain region and to conduct analysis by these regions.
Some of the observations are shown below:
What did we end up doing?
After serving up this information to the Xero Leadership Team and Board, Xero will be amplifying its current rewards around flexible / remote working and multiple leave types and add some new reward offerings based on the insights of the survey. Below are the areas that have been prioritised for FY23:
- Base salary increases – Increased Interim Salary Review / Annual Salary Review investment globally
- Flexible working policy – Work anywhere we have an entity for up to 90 days
- Additional leave – Additional five days paid leave for all Xeros
- Insurance – New or enhanced benefits across most regions
However Xero will continue to analyse and model the results for specific demographics and campaigns and use the insights to inform the future remuneration and reward strategy and initiatives.
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