CIPD reward survey exposes failure to apply strategic planning or measure effectiveness

Only one-third of organisations have a reward strategy and only half of these measure its effectiveness, a survey reveals.

A study of 466 companies by the Chartered Institute of Personnel and Development (CIPD) also found just one-quarter of these organisations link measurement to business data, leaving most unable to show how their reward strategy supports their strategic goals.

Charles Cotton, CIPD pay and benefits adviser, said: “Organisations could make the wrong decision and waste time and money on pay and benefits if they fail to measure the effectiveness of the reward strategy properly.

“HR and reward professionals should investigate measures, such as customer satisfaction and line manager feedback, to show the real value such packages can have on all areas of the business.”

The Annual Reward Survey 2007 also found four in 10 organisations plan to increase their benefit spend and more than one-third of public and voluntary sector employers will be making changes to pay structures this year.