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COMPENSATION ROUNDTABLE™
MAY 2008 www.cr.executiveboard.com BENCHMARKING REWARD AND RECOGNITION PROGRAMS
Trends and Practices in Designing, Implementing, and Managing Reward and Recognition Programs
COMPENSATION ROUNDTABLE™
B ENCHMARKING R EWARD AND R ECOGNITION P ROGRAMS
PAGE 2
K EY FINDINGS
ISSUE OVERVIEW
As competition for critical talent increases, organizations look to diversify their employee engagement and retention strategies. Many organizations realize that an effective reward and recognition (R&R) program is part of a compelling total rewards offering that engages employees and drives business outcomes. Despite awareness of the importance of R&R, many organizations struggle to create and implement a successful program. To support members in their efforts to create a more effective program, this report provides the Roundtable’s key findings on R&R drawn from a membership survey.
D EFINITIONS AND S COPE OF R ESEARCH
Data collection for this report occurred through a survey of 27* member organizations with R&R programs. Pages 6–8 also contain data from the Roundtable’s 2007 survey on compensation plan design. The table below provides relevant definitions and outlines the scope of the analysis : Definitions
Reward Recognition Refers to cash, trips, and other gifts given Refers to acknowledgement via an e-mail, public ceremony, thank you card, plaque, or other means Refers to situations in which a formal process is used to reward/recognize, including some level of approval by leadership (manager and above) Refers to occasions when an approval process is not needed to reward/recognize
Formal R&R Informal R&R
Scope of Analysis
R&R for Performance § § § § § § § § § § § § § § Individual Team Managerial/leadership Cost saving ideas Customer satisfaction/service Embodying company culture Innovation Length-of-service Safety Commitment to the environment Community service Bonus awards Stock grants Sales incentives
Included in Report
R&R for Contributions to the Organization
R&R for Contributions Outside the Organization Not Included in Report Base or Variable Compensation
*Please note that not all organizations responded to every question and that the number of respondents (N) is indicated throughout the report. Also, where percentages total more than 100%, participants were asked to select all answer choices that apply.
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COMPENSATION ROUNDTABLE™
B ENCHMARKING R EWARD AND R ECOGNITION P ROGRAMS
PAGE 3
K EY FINDINGS
EXECUTIVE S UMMARY
To help members design and implement an R&R program that effectively motivates and engages employees, this page outlines the Roundtable’s findings regarding the key steps of the process, including designing the program, establishing ownership and allocating resources, providing training and communicating the program, and measuring and managing the program. The Roundtable used these steps, which are based on the standard approach to designing, implementing, and managing any program, as the framework for our work. The following pages provide a more detailed overview and include benchmarking information for each step.
PHASE 1: PROGRAM DESIGN
Design and implement a program that will effectively engage employees and achieve business objectives.
PHASE 2: OWNERSHIP & RESOURCES
Establish program ownership and allocate resources to effectively implement and manage the program.
Action Steps and Key Findings þ Select Activities and Behaviors to Reward/Recognize— Organizations most frequently recognize length-of-service and reward individual excellence in role and innovation. þ Incorporate Employee Feedback —Most organizations that collect employee f eedback do so via an employee survey . þ Select R&R Form and Types—Most organizations use all forms of R&R (monetary, non-monetary, formal, and informal). þ Address Global Considerations—More than half of organizations with global programs incorporate local and/or cultural preferences in their programs .
Action Steps and Key Findings þ Determine Program Ownership—More organizations house their R&R program within the compensation department than any other department. þ Allocate Resources—Organizations spend less than 1% of payroll on R&R, and most R&R budget comes either entirely from the corporate budget or entirely from the line unit or department budget. þ Decide Whether or Not to Engage a Vendor—Organizations most frequently engage a vendor for reward packages and thank you/recognition cards.
PHASE 4: M AN AGEMENT AND MEASUREMENT
Ensure employees utilize the program and continually assess its effectiveness over time.
PHASE 3: TRAINING
AND
COMMUNICATION
Maximize program impact and utilization by training managers and effectively communicating the program.
Action Steps and Key Findings þ Select a Method to Ensure That Employees Are Rewarded/Recognized—Organizations most frequently conduct employee surveys to ensure employees are rewarded/recognized, and more than half of organizations track who is rewarded/recognized. þ Measure Program Results—Most organizations that measure the results of their program do so by gauging employee satisfaction and engagement. þ Collect Employee Feedback —Less than half of organizations solicit employee feedback on their R&R program.
Action Steps and Key Findings þ Train Managers on the Program—Organizations most frequently train managers on the reasons for the program and their role in executing it. þ Involve Senior Leadership in Communications — Organizations most frequently involve leadership in announcing the program and award recipients. þ Decide How Frequently to Send Communications—Most organizations send employees f ormal messages about their R&R program either quarterly or annually. þ Select Communication Channels —Organizations leverage less resource-intensive methods of mass communication to communicate their program and the presentation of an award.
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PAGE 4
K EY FINDINGS
Select Activities and Behaviors to Reward/Recognize
Organizations should select activities to reward/recognize that align with program objectives; these activities should encourage behaviors that drive desired business outcomes. Activities that companies recognize may be different than those they reward. Organizations Most Frequently Recognize Length-of-Service Organizations recognize various actitivies and behaviors through their program , but most frequently recognize activities that visibly impact the bottom line, such as loyalty, great ideas, and individual performance; the greatest percentage of organizations recognize length-of-service (70%), innovation (63%), cost-saving ideas (63%), and individual excellence in role (63%). Meanwhile, fewer organizations recognize activities that may contribute less directly to the bottom line, such as community service (52%), embodiment of company culture (48%), commitment to the environment (41%), and safety (33%). Figure 1 below illustrates the prevalence of recognizing employees for various activities and behaviors.
Figure 1: Prevalence of Recognizing Various Activities and Behaviors (N=27)
Percentage of Organizations 80%
70% 63% 63% 63% 59% 56% 56% 52%
48% 41% 33%
40%
Embodiment of Company Culture
Individual Excellence in Role
Team Performance
Leadership / Managerial Excellence
Customer Satisfaction / Service
Commitment to the Environment
Cost-Saving Ideas
Community Service
0% Length-ofService Innovation
Organizations Most Frequently Reward Individual Excellence in Role and Innovation Organizations reward various types of actitivies and behaviors, but the greatest percentage reward individual excellence in role (74%) and innovation (74%). Although companies most often recognize length-of-service, this is not the most frequently rewarded activity, as it does not necessarily correlate with good performance. Similar to recognition, less than half of organizations reward activities that may not have as direct an impact on the bottom line, such as embodiment of company culture (48%), community service (41%), commitment to the environment (22%), and safety (19%). Figure 2 below depicts the prevalence of rewarding employees for various activities and behaviors.
Figure 2: Prevalence of Rewarding Various Activities and Behaviors (N=27)
Percentage of Organizations 80%
74% 74% 70% 70% 67%
63% 56% 48% 41%
40%
22% 19%
Embodiment Company Culture
Individual Excellence in Role
Team Performance
Customer Satisfaction / Service
Leadership / Managerial Excellence
Commitment to the Environment
Cost-Saving Ideas
Community Service
0% Innovation Length-ofService
© 2008 Corporate Executive Board. All Rights Reserved.
Safety
Safety
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K EY FINDINGS
Incorporate Employee Feedback
Organizations should incorporate employee feedback in order to reward and recognize in a way that motivates and engages the employee segments targeted by the program (i.e., non-exempt employees, executives, new hires). Companies may collect employee data from external sources or through internal surveys and/or focus groups. Most Organizations Collect Employee Feedback Via an Employee Survey When Designing Their Program When designing their program, most organizations (85%) solicit some type of employee feedback to understand how employees want to be rewarded/recognized. The most common method for gathering employee feedback during the design process is conducting an employee survey, likely because surveys are relatively low-resource methods of collecting actionnable data to guide R&R program design. Fewer organizations use employee focus groups and advisory groups/committees to gather employee feedback. Figure 3 below illustrates the prevalence of using a certain method (or methods) to solicit employee feedback.
Figure 3: Methods for Collecting Employee Feedback When Designing an R&R Program (N=23)
Percentage of Organizations
78%
Collecting Feedback Because different employee segments have different preferences , organizations should ask employees about their preferences for the following: § § § § Formal vs. infomal R&R Monetary vs. non-monetary R&R Types of R&R (e.g., length-of-service, team awards, CEO awards) Activities rewarded/recognized (e.g., comittment to the environment) R&R prizes (e.g., jewelry, trips, plaques) R&R delivery mechanism (e.g., meeting with manager, annoucement at ceremony)
80%
43%
40%
17% 17%
Other tools used: § Feedback already submitted on the current program § Market research
0% Employee Survey Employee Focus Groups Employee Advisory Group / Committee Other
§ §
Select R&R Form and Types
Based on the program ’s objectives, employee feedback, and available resources, organizations should select the appropriate R&R form (i.e., formal, informal, monetary, non-monetary) and type (e.g., service awards, peer awards). Most Organizations Use All Forms of R&R Organizations use a combination of formal, informal, monetary, and non-monetary methods to reward/recognize employees. All organizations use formal methods, and almost all (96%) offer monetary R&R. Slightly fewer organizations leverage non-monetary methods (85%) and informal R&R (78%). The following figure depicts the prevalence of the four forms of R&R:
Figure 4: Prevalence of R&R Forms (N=27) Examples of monetary R&R include cash and gift certificates ; examples of non-monetary R&R include plaques and thank you cards.
Formal* Informal* Monetary Non-Monetary 0% 50% Percentage of Organizations
85% 78%
100%
96%
100%
*See page 2 for definitions
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K EY FINDINGS
Select R&R Form and Types (Continued)
Most Organizations Use a Combination of Formal and Informal R&R Most organizations use both formal and informal methods of R&R, yet vary in degree of use. None of the surveyed organizations use only informal R&R in their program, and although it would be easiest to ensure that formal R&R is administered consistently across the organization, only 11% indicate they exclusively use formal R&R. As demonstrated in Figure 5 below, most organizations rely on some mix of both formal and informal methods of R&R, with the largest percentage (41%), using equal amounts of both. This is likely because formal R&R is by definition limited to a smaller percentage of high-performing employees, yet organizations realize the importance of ensuring that all employees feel recognized and appreciated for their contributions.
Figure 5: Extent to Which Organizations’ Programs Use Formal and Informal R&R (N=27)
Percentage of Organizations 50%
41% 33%
25%
15% 1% 1 0%
0% Entirely Formal Mostly Formal Equal Amounts of Formal and Informal Mostly Informal Entirely Informal
Employees Prefer That R&R Include Monetary Awards According to the results of the Roundtable’s 2007 survey on compensation plan design, employees value programs that include some type of monetary R&R more highly than programs that do not. In fact, they most value programs that offer smaller amounts of money to a large number of people (25% of employees awarded $1,000) or a much larger amount to just a few people (5% of employees awarded $5,000). Figure 6 below depicts perceived value for various types of R&R programs as a percentage of the maximum value possible.
Figure 6: Perceived Value of Various Types of R&R Programs as a Percentage of Maximum Value
$5,000 to 5% of Employees 37%
No Formal Programs 2% Recognition Without Cash Award 5% $1,000 to 5% of Employees 22%
$1,000 to 25% of Employees 34%
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K EY FINDINGS
Select R&R Form and Types (Continued)
Organizations Offer Various Types of R&R As Figure 7 demonstrates, organizations employ multiple types of R&R, but most frequently offer company celebrations (85%) and spot awards that require approval from leadership (85%). Few organizations (11%) incorporate a points system in their program in which employees earn points towards items in a catalogue or spending cards. However, a points system may be a potential solution to the challenges of ensuring that the program is fair and equitable across locations and that employees are motivated by their prizes. All of the participants offer at least one of the types of R&R listed below and most offer more than one.
Figure 7: Prevalence of Using Various Types of R&R to Reward/Recognize Employees (N=27)
Percentage of Organizations
90%
85%
85%
78%
70% 56% 52%
Participants offer four to five R&R types on average.
45%
15% 1% 1
0% Company Spot Awards Celebrations that Require (Annual Parties, Approval from Picnics, etc.) Leadership (Cash , Tickets, Gifts, etc.) Ceremonial Awards (Dinners, President’s Award, etc.) Ongoing Recognition (Birthday Celebrations, Thank You Cards, etc.) Peer Awards Spot Awards Requiring No Approval Raffle Prizes Points System
For Their Spot Awards Program, Organizations Most Frequently Offer Cash Awards According to the results of the Roundtable’s 2007 survey on compensation plan design, those organizations that offer a spot awards program most frequently offer cash awards as the prize (92%). This is likely because employees prefer to receive cash, as it may be used towards whatever they most value or need. More than half of organizations (68%) offer gifts certificates and a smaller percentage offer consumer products and additional paid-time-off (PTO). Figure 8 below depicts the prevalence of offering different types of spot awards.
Figure 8: Prevalence of Offering Different Types of Spot Awards (N=37)
Percentage of Organizations
100%
92%
68%
50%
22% 16% 3%
Organizations may also offer restricted stock as a spot award.
0% Cash Gift Certificates Consumer Additional PTO Products (TVs, iPods, etc.) Other
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K EY FINDINGS
Select R&R Form and Types (Continued)
For Their Spot Awards Program, More Than Half of Organizations Offer Awards That Are Less Than $500 in Value According to the same Roundtable analysis , more than half of organizations with a spot awards program offer awards valued between $1 and $500 (57%). However, a significant portion give awards that are between $500 and $1,000 in value (38%). Figure 9 below depicts the typical value of spot awards given by organizations that participated in the Roundtable’s 2007 study.
Figure 9: Typical Value of Spot Awards (N=37)
40% Percentage of Organizations
57% of organizations give awards valued between $1 and $500
38%
22%
20%
19% 16%
5%
0% $1–$100 $100–$200 $200–$500 $500–$1000 $1000 or more
Return on Investment (ROI) on Spot Award Spend Decreases Past $500 The same analysis reveals that the value employees perceive they gain from a spot award grows as the value of the award they receive increases. However, organizations must balance employees’ perceived award value with the cost of the award itself. Although one would anticipate that ROI would double each time the award amount doubles, this is not always the case. As depicted below in Figure 10, an organization receives less relative value each time the award doubles in value above $500.
Figure 10: ROI on Spot Award Spend (N=12909)
% Change in Value/Change in Cost 50%
25%
0% $0 $500 $1,000 Spend in U.S. Dollars Projected Increase in ROI Actual Increase ROI $1,500 $2,000
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PAGE 9
K EY FINDINGS
Address Global Considerations
International organizations must decide how to administer a program on a global basis. A few major challenges specific to a global program include deciding whether or not the activities rewarded, the types of R&R offered, and the awards given will be the same globally. Ensuring that the program is fair and equitable is also difficult, and organizations may consider solutions such as incorporating local preferences in the program and adjusting monetary awards for different currencies. This section provides benchmark data on how international organizations approach these challenges. Challenge #1: Deciding Whether or Not to Reward/Recognize the Same Activities Across All Locations Organizations with Global Programs Tend to Reward/Recognize Mostly the Same Activities at All of Their Global Locations As Figure 11 illustrates , 88% of participating organizations reward/recognize mostly the same or entirely the same activities across all of their global locations. Only 12% of organizations reward/recognize mostly different, or entirely different, activities. In this way, organizations achieve some level of program consistency across all locations , but may also incorporate any special objectives they have for particular locations.
Figure 11: Are the Same Activities Rewarded/Recognized Across All Global Locations? (N=16)
Percentage of Organizations 70%
63%
35%
25% 6% 6%
0% All the Same Mostly the Same Mostly Different All Different
Challenge #2: Deciding Whether or Not to Offer Similar Types of R&R Across All Locations Organizations with Global Programs Tend to Offer Similar Types of R&R at all of Their Global Locations Organizations with global programs typically offer the same, or mostly the same, types of R&R (e.g., peer awards) across all of their global locations . As Figure 12 depicts, 81% of organizations offer mostly the same or entirely the same categories of R&R. Only 19% of organizations offer categories that are mostly or entirely different. Again, incorporating a few slight differences allows organizations to ensure their program is globally consistent, yet locally relevant.
Figure 12: Are the Categories of R&R Offered the Same Across All Global Locations? (N=16)
Percentage of Organizations 60%
50%
31%
30%
13% 6%
0% All the Same Mostly the Same Mostly Different All Different
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PAGE 10
K EY FINDINGS
Address Global Considerations (Continued)
Challenge #3: Deciding Whether or Not to Give the Same Awards at All Locations Organizations with Global Programs Tend to Give Similar Awards at all of Their Global Locations Organizations with global programs typically give the same, or mostly the same, awards across all of their global locations (i.e., the award given for length-of-service at one location is the same as the award given at another location). As Figure 13 depicts, 69% of organizations give awards that are mostly or entirely the same at all of their global locations. Only 31% of organizations give awards that are mostly or entirely different. Variation in awards given may be the result of local availability or organizational attempts to ensure that the program is fair and equitable across locations (i.e., employees in one region and/or country may not value a particular award as highly as employees in another region and/or country).
Figure 13: Are the Actual Awards Given the Same Across All Global Locations? (N=16)
60% Percentage of Organization
50%
30%
19%
25%
6%
0% All the Same Mostly the Same Mostly Different All Different
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PAGE 11
K EY FINDINGS
Address Global Considerations (Continued)
Challenge #4: Ensuring the Program is Fair and Equitable Across All Locations More Than Half of Organizations with Global Programs Incorporate Local and/or Cultural Preferences in Their Programs Accounting for local and/or cultural preferences not only helps ensure that a global R&R program is fair and equitable across locations, but also helps ensure that rewards are more personalized, and therefore more meaningful to the recipient. As Figure 14 demonstrates, most organizations with global programs (69%) incorporate some local and/or cultural preferences in their program. For those organizations that do, the greatest percentage do so by tailoring the actual award given. Figure 15 below illustrates the prevalence of incorporating local and/or cultural differences into a portion (or portions) of the R&R program.
Figure 14: Do You Incorporate Local and/or Cultural Preferences in Your Program? (N=16) Figure 15: Prevalence of Incorporating Local and/or Cultural Differences in Different Parts of the R&R Program (N=11)
Percentage of Organizations 60%
55% 45% 36%
Yes 69%
No 31%
30%
27%
0%
Gi Ty ve pe n of Re wa rd/ Re co gn itio n Ac tivi ty Re wa rde d for Se lec tio n Cr ite ria
More Than Half of Organizations Adjust Monetary Awards for Different Currencies As Figure 16 demonstrates, more than half of organizations with global programs (62%) adjust monetary awards where currencies differ, helping to ensure the program is fair and equitable across the company. Although many companies do this, a large percentage (38%) do not adjust monetary awards for different currencies and therefore recipients of the same award receive amounts that are unequal in value.
Figure 16: Do You Adjust Monetary Awards for Different Currencies? (N=16)
Yes 62%
Ac tua lA wa rd
No 38%
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PAGE 12
K EY FINDINGS
Determine Program Ownership
After deciding what the program should look like, organizations must decide how the program will be managed, which department will house it, and who will own it to effectively implement the program. The Majority of Surveyed Organizations Take a Centralized Approach to Managing Their R&R Program Most organizations (64%) have a program that is managed more by headquarters than by business units or departments; only 20% have a program managed more at the business unit or department level. This may help organizations ensure that the program is administered and used cons istently across the organization and across all locations. Figure 17 below depicts the prevalence of various approaches to managing an R&R program.
Figure 17: Approaches to Managing R&R Programs (N=25) Managing a Global Program
Percentage of Organizations 50%
44%
64% of organizations have a program primarily administered from headquarters
25%
20% 16% 12%
20% of organizations have a program where decisions are made primarily at the business unit or department level
8%
For those organizations that have a global program (N=16): § 63% have a program primarily administered from headquarters § 25% have a program where decisions are made primarily at the business unit or department level § 13% have a hybrid model
0% Centralized Somewhat Centralized Hybrid Somewhat Decentralized Decentralized
More Organizations House Their R&R Program Within the Compensation Department Than Any Other Department Half of surveyed organizations (50%) house their R&R program within the compensation department, likely reflecting the view that R&R is part of the total compensation package. For those that do not, the program is usually housed either within HR more generally, or is owned by two separate departments. When a program is owned by two departments, one department will likely administer some portions of the program (e.g., service awards) and another department will administer others (e.g., performance awards). Figure 18 below illustrates the prevalence of ownership by various departments.
Figure 18: Departments Within Which Organizations House Portions of the R&R Program (N=26) Other functions that may have ownership over portions of the program: § Benefits § Corporate Communications and Marketing § Finance § Organizational & Staff Development § Various Business Units
Percentage of Organizations
60%
50%
30%
15% 12% 12% 8% 4%
0% Compensation HR Compensation and Another Function Another Function Compensation and HR HR and Another Function
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PAGE 13
K EY FINDINGS
Determine Program Ownership (Continued)
Most Organizations Have a Position or Team At Headquarters That Manages Their R&R Program As Figure 19 depicts, most organizations (93%) have a designated position or team at headquarters that owns their program, which may help ensure accountability for R&R, as well as program consistency. HR generalists, line managers, and coordinators at the local or business unit level also have partial ownership over the program at some organizations. For those companies that have more than one employee at headquarters managing their program, the average number of staff dedicated to that team is 4.85 people. Moreover, larger organizations do not necessary have larger teams; a few of the smaller organizations in our sample have the greatest number of employees at headquarters dedicated to R&R.
Figure 19: Prevalence of Some R&R Ownership by Various Parties (N=27)
The average team or staff size at headquarters is 4.85 people (N=10).
Percentage of Organizations 60%
56%
37%
Other groups that may have ownership over portions of the program: § Departmental Administrative Assistants § Executive Assistants § Local Coordinators § OD Leaders
22%
30%
1% 1 1% 1
0% Designated Team or Staff at Headquarters Designated HR Generalists Line Managers Position at That Work with Headquarters the Line Some Other Group
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PAGE 14
K EY FINDINGS
Allocate Resources
After establishing program ownership, organizations must determine spending levels for the program and decide where the budget for the program will come from (e.g., corporate budget, department budget, chargeback to department). Organizations Spend Less Than 1% of Payroll on R&R Organizations must allocate enough resources to fund the various elements of their program, including awards , administration, communication, and measurement. On average, surveyed organizations spend 0.62% of payroll on R&R annually. Per employee, they spend approximately $297.67 annually in U.S. dollars. Those organizations that spend higher amounts on R&R may be leveraging their program as a larger component of their overall compensation strategy, making tradeoffs between R&R, base pay, bonuses, etc. Figure 20 below depicts the percent of payroll that several of the participants spend on R&R and also details how much a few of the participants spend on R&R annually per employee in U.S. dollars.
Figure 20: Resources Spent on R&R Annually Percent of Payroll Spent on R&R Total and By Category Total (N=10) Average: 0.62% Range: 0.03%–1.0% Reward (N=10) Average: 0.50% Range: 0.03%–1.5% Recognition (N=3) Average: 0.51% Range: 0.03%–1.0%
Amount Spent on R&R Per Employee in U.S. Dollars (N=6) Average: $297.67 Range: $125–$518
Most Organizations’ R&R Budget Comes Either Entirely Fr om the Corporate Budget or Entirely From the Line Unit or Department Budget More than half of organizations (59%) indicate that there is not shared budget responsibility for their R&R program; budget comes either entirely from the corporate budget, or entirely from the line unit or department budget. Such an arrangement may be designed for convenience, or may reflect differing philosophies on R&R. Although it is less common for organizations to split the budget between the corporate and department budgets , approximately 28% of organizations split the costs in this way. Figure 21 below illustrates the prevalence of allocating R&R program budget from different sources at the participating organizations.
Figure 21: Source of R&R Budget at the Participating Organizations (N=22)
40% Percentage of Organizations
32% 27%
20%
14% 9% 5% 14%
0% Entirely Corporate Mostly Corporate Half Corporate Mostly Line Unit and Line Unit or or Department Department Entirely Line Unit or Department Mostly or All Chargeback to Line Unit or Department
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K EY FINDINGS
Decide Whether or Not to Engage a Vendor
While assigning program ownership and allocating resources, organizations may decide to engage a vendor to support a portion of their program. Major challenges with implementing an R&R program that might necessitate the use of a vendor include infrastructure support (e.g., electronic nomination and tracking software) and providing awards and recognition cards, such as thank you cards. However, some organizations also use a vendor to design their entire R&R program. Most Organizations Use a Vendor to Support their R&R Program Since organizations may not have the proper infrastructure in place to implement an R&R program, and most likely do not produce employee awards themselves, the majority of surveyed organizations (74%) use a vendor to support some portion of their R&R program. As Figure 22 demonstrates, approximately one-quarter of organizations (26%) house all aspects of R&R within the organization. A sample list of the vendors participants use in conjunction with their R&R program is also included below.
Figure 22: Do You Use a Vendor to Support a Portion of Your R&R Program? (N=27)
Vendors Used by Participants for Some Portion of Their R&R Program § § § § American Express Birkenstock Custom Design Marketing Excellence in Motion Geiger Bros. Giftcertificates.com Globoforce Grass Roots Hallmark Insights § § § § § § § Hewitt Associates Journeymasters Kreyer Associates OC Tanner Rideau Recognition Solutions Springbok Services Strategic Meetings Solutions
Yes 74%
No 26%
§ § § § §
Organizations Most Frequently Engage a Vendor for Reward Packages and Thank You/Recognition Cards Although there is no one step in the process for which the majority of organizations engage a vendor, organizations most frequently engage a vendor to create reward packages (40%), such as trips or tickets, and thank you/recognition cards (40%), as these are difficult to create internally, but are likely to be a part of most programs. Although most organizations do not engage a vendor to develop electronic approval software, a points system, or electronic tracking software, this may be because they are not using these at all. Figure 23 below depicts the prevalence of engaging a vendor for different portions of the R&R process.
Figure 23: Portions of the Process for Which Organizations Engage a Vendor (N=20)
Percentage of Organizations
50%
40% 40% 35% 25% 25%
Organizations may also engage a vendor to provide small gifts.
25% 25% 20%
25%
0% Reward Packages Thank You / Recognition Cards Electronic Nomination Software Electronic Tracking Software Other Points System Program Design Electronic Approval Software
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Train Managers on the Program
After determining program ownership and allocating resources, organizations must effectively communicate the program ; even the best designed program will have minimal impact unless it is well communicated. Since managers play a key role in employee communications, it is important to train them on the program so they can effectively relay messages about the program to employees. Also, if managers understand the drivers behind the program, they will be more likely to engage employees in the process. Organizations Most Frequently Train Managers on the Reasons for the Program and Their Role in Executing It As Figure 24 demonstrates, more than half of organizations (65%) train managers on some aspect of the R&R program. In fact, of those organizations that provide some type of training, 100% train managers on the reasons for the program. Organizations also frequently train managers on their role in the program and how to communicate the program. This helps organizations ensure that managers understand the program and can effectively reinforce and promote it. Figure 25 below depicts the frequency with which organizations train managers on various aspects of the R&R program.
Figure 24: Do You Train Managers on Some Aspect of Your R&R Program? (N=26)
Percentage of Organizations
Figure 25: Aspects of the Program for Which Organizations Provide Managers with Training (N=17)
100% 88% 76% 65% 47%
100% 50% 0% Reasons for the Program
Yes 65%
No 35%
Their Role in the Program
How to Communicate the Program
How to Reward / Recognize Effectively
How Frequently to Reward / Recognize
Involve Senior Leadership in Communications
Involving senior leadership in program communciations demonstrates organizational commitment to the program and reinforces the importance of engaging in behaviors and activities that are rewarded/recognized. Leadership is Most Frequently Involved in Program Communications by Announcing the Program and Award Recipients Eighty-five percent of organizations involve senior leadership in the communication of their R&R program, and of those that do, leadership is typically involved in announcing the program (74%) and announcing award recipients (70%). Less than half of organizations (43%) engage senior leadership in reminding employees to use the program, most likely due to the time it would require. Figure 26 depicts the prevalence of including senior leadership in different parts of the communication process.
Figure 26: Prevalence of Including Senior Leadership in Different Parts of the Communication Process (N=23)
Percentage of Organizations 80%
74% 70% 43%
Senior leadership may be guests of honor at annual ceremonies or involved in department level programs.
13%
40%
0% Announcing the Program Announcing Award Recipients Reminding Employees to Use the Program Other
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Decide How Frequently to Send Communications
When crafting R&R communications, organizations must decide how frequently to send employees messages about the program. Inconconsisent or infrequent communications may reduce perceived organizational commitment to the program, or fail to remind employees often enough to foster commitment to the program. Most Organizations Send Employees Formal Messages About Their R&R Programs Either Quarterly or Annually Most organizations (80%) send formal messages (e.g., send e-mails, have information sessions) about their program to employees either quarterly or annually. Those organizations that send messages to employees annually may not be fully leveraging communications to promote the program and reinforce the behaviors they seek to encourage. Although organizations should avoid sending R&R messages so frequently that they are considered spam, they must send communciations frequently enough to demonstrate commitment to the program. Figure 27 below illustrates the frequency with which organizations send employees formal messages about their program.
Figure 27: Frequency with Which Organizations Send Employees Formal Messages About Their R&R Programs (N=20)
50% Percentage of Organizations
80% of organizations send formal messages either quarterly or annually
45%
35%
25%
15%
5% 0%
0% Weekly Monthly Quarterly Annually Varies
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Select Communication Channels
Organizations must select the channels they will use to communicate the program and to communicate that an award has been given, balancing the ease of using technology-based mass communications with the impact of using more personal, live channels. Organizations Leverage Less Resource-Intensive Mass Communications to Communicate their Program To communicate their program to employees, organizations rely on less resource-intensive channels that allow for widespread communications, often involving mass-customizable technology. For example, as Figure 28 demonstrates, organizations most frequently leverage the company intranet and organization-wide e-mails, which are easily-customized and reach a large number of employees. Of the written and live channels, organizations most often select those channels that have the widest impact and involve little resource investment, such as department-led information sessions and the company newsletter.
Figure 28: Prevalence of Using Different Channels to Communicate the Program (N=27)
Live Channels
Manager-Led Information Sessions Public Announcements at Meetings
30%
33%
Department-Led Information Sessions
44%
Written Channels
Mail Posters
15%
26%
Notices on Bulletin Boards Company Newsletter
37%
44%
Technology-Based Channels
Organizations tend to use low -resource channels that reach the greatest number of employees to communicate their program, such as the company intranet and company-wide e-mails.
Podcasts
7%
Organization-Wide E-mails Company Intranet
63%
96%
Other (Combination of Channels or It Varies) 0%
15%
50% Percentage of Organizations
100%
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K EY FINDINGS
Select Communication Channels (Continued)
Organizations are More Likely to Use Live Channels to Communicate the Presentation of an Award The most common method for communicating the presentation of an award is the company intranet. However, as Figure 29 demonstrates, other written and technology-based channels are used less frequently during this phase as compared with the initial program communication (see Figure 28). Relying more heavily on personal, live communication channels to communicate that an award has been given allows organizations to demonstrate commitment to the program by investing time and resources in it. Personal interactions also allow for more elaboration on the meaning and influence of recipients’ actions.
Figure 29: Prevalence of Using Different Communication Channels to Communicate That an Award Has Been Given (N=26)
Live Channels
Public Announcements at Meetings Department-Led Information Sessions Manager-Led Information Sessions
37%
37%
Live channels are used more frequently to communicate that an award has been given than during initial program communication.
41%
Mail
7%
Written Channels
Posters
7%
Notices on Bulletin Boards
7%
Company Newsletter
37%
Technology-Based Channels
Mass communication channels are used less frequently to communicate that an award has been given than during initial program communication.
Podcasts Organization-Wide E-mails
0%
33%
Company Intranet
59%
Other (Combination of Channels or It Varies) 0%
30%
30% Percentage of Organizations
60%
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K EY FINDINGS
Select a Method to Ensure that Employees Are Rewarded/Recognized
Organizations may select a mechanism (e.g., a centralized tracking system ) to ensure that the program is properly utilized and that employees are rewarded/recognized. This is especially appropriate for global organizations where awards are administered at the local level, or in situations where leadership does not approve and administer all awards. Organizations Most Frequently Conduct Surveys to Ensure Employees are Rewarded/Recognized As Figure 30 demons trates, most organizations (78%) have at least one method of ensuring that employees are rewarded/recognized, and most frequently employ an engagement survey. Such surveys not only indicate the extent of program use, but how meaningful and effective the program is as well. As Figure 31 demonstrates, other common methods for ensuring that employees are rewarded/recognized include asking managers to share the ways they reward and recognize employees and using a centralized tracking system.
Figure 30: Do You Have a Mechanism for Ensuring that Employees Are Rewarded/Recognized? (N=27)
Yes 78%
No 22%
Figure 31: Methods Used by Organizations to Ensure Employees are Reward/Recognized (N=21)
Percentage of Organizations
80%
71% 62% 57% 38% 24%
Other methods used: § HRBPs remind managers § Leadership takes responsibility § Track nominations
40%
14%
0% Conduct an Engagement Survey Ask Managers Use a All Dedicated to Share How Centralized Funds Must be They Reward / Tracking System Used Within a Recognize Certain Amount of Time Other R&R is Part of Managers’ Competencies / Performance Review
More Than Half of Organizations Track Who is Rewarded/Recognized Although tracking which employees have been rewarded/recognized does not provide insight into whether the program is achieving objectives, it does help organizations ensure that they impact enough employees to make the program meaningful. Since employees must believe that they are eligible for R&R to be engaged in the program, organizations should use a tracking mechanism to ensure they reward/recognize enough employees. Most organizations (88%, N=26), track which employees have been rewarded/recognized for at least some of the rewards and recognition they give.
Percentage of Workforce Rewarded/Recognized Annually On average, surveyed organizations reward/recognize 34.25% of employees annually with their centrally managed program (N=12).
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Measure the Results of the Program
To ensure that the program achieves strategic business objectives, organizations should measure the results of their R&R program using metrics aligned with program objectives. Below is a list of a few program objectives, paired with sample measures of success:
Measures of Success § § § § Employee surveys indicate that the work environment has become more positive as a result of the program Turnover has decreased since the program’s inception The organization moved up in “Employer of Choice” rankings There have been fewer on-the-job accidents since the program’s inception
Program Objectives § § § § Create a more positive work environment Decrease employee turnover Improve the organization’s reputation in the external labor market Reinforce the importance of on-the-job s afety
Most Organizations that Measure the Results of Their Program Gauge Employee Satisfaction and Engagement As Figure 32 demonstrates, more than half of organizations (63%) measure the results of their R&R program. Those that do so most frequently measure employee satisfaction and engagement to gauge program results (94%). Figure 33 below illustrates the prevalence of using a certain method (or methods) to measure the results of the program. However, as mentioned above, organizations should select and track metrics that align with program objectives (e.g., employee retention, number of on-the-job accidents).
Figure 32: Do You Measure the Results of Your R&R Program? (N=27)
Yes 63%
No 37%
Figure 33: Prevalence of Using a Certain Method (or Methods) to Measure the Results of the Program (N=17)
94%
Percentage of Organizations
100%
50%
29% 18% 12%
Other methods used: § Employee participation in the program via number of nominations § Points awarded § Redemption of points for prizes
0% Employee Satisfaction / Engagement Employee Retention Employee Productivity Other
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Collect Employee Feedback to Continually Improve the Program
Since employees must be engaged in the R&R program for it to be successful, organizations should continually gather employee feedback on the program to assess program effectiveness and identify areas for improvement. Less than Half of Organizations Solicit Employee Feedback on Their R&R Program As Figure 34 demonstrates, less than half of organizations (41%) collect employee feedback on their program. However, such feedback may be leveraged to improve the program by pinpointing problem areas (e.g., employees do not know enough about the program, employees are not motivated by the awards themselves, employees would prefer more informal recognition). Organizations may use the following tools to collect employee feeback:
§ § § Focus Groups Interviews Surveys Figure 34: Do You Solicit Employee Feedback on Your R&R Program? (N=27)
No 59%
Yes 41%
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APPENDIX: P ROFILE OF R ESEARCH P ARTICIPANTS
The graphs below depict the industry, revenue size, and employee size of the 27 participants.
Industry of Participating Organizations
Regions in Which Participating Organizations Have an R&R Program
Global, Including North America, 59%
Schools & Educational Services, 11% Retail, 4% Professional Services, 4% Pharmaceutical, 7%
Telecommunications, Consumer Products, 4% 1% 1 Biotechnology, 4%
Energy and Utilities, 4% Financial Services, 21% Health Care, 7%
High-Tech, 19% Heavy Manufacturing, 4%
North America Only, 41%
Employee Size of Participating Organizations
Revenue Size of Participating Organizations
50,000–100,000, 19%
Over 100,000, 7% 2,000–10,000, 30%
Over $10 billion, 33%
$500 million– $2 billion, 11%
10,000–50,000, 44%
$5 billion–$10 billion, 15%
$2 billion–$5 billion, 41%
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NOTE TO MEMBERS: This project was researched and written to fulfill the research request of several members of the Corporate Executive Board and as a result may not satisfy the information needs of all member companies. The Corporate Executive Board encourages members who have additional questions abo ut this topic to contact their research manager for further discussion. The views expressed herein by third-party sources do not necessarily reflect the policies of the organizations they represent. PROFESSIONAL SERVICES NOTE: The Compensation Roundtable (CR™) has worked to ensure the accuracy of the information it provides to its members. This project relies upon data obtained from many sources, however, and the CR cannot guarantee the accuracy of the information or its analysis in all cases. Furthermore, the CR is not engaged in rendering legal, accounting, or other professional services. Its projects should not be construed as professional advice on any particular set of facts or circumstances. Members requiring such services are advised to consult an appropriate professional. Neither Corporate Executive Board nor its programs are responsible for any claims or losses that may arise from any errors or omissions in their reports, whether caused by Corporate Executive Board or its sources.
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MAY 2008 www.cr.executiveboard.com BENCHMARKING REWARD AND RECOGNITION PROGRAMS
Trends and Practices in Designing, Implementing, and Managing Reward and Recognition Programs
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K EY FINDINGS
ISSUE OVERVIEW
As competition for critical talent increases, organizations look to diversify their employee engagement and retention strategies. Many organizations realize that an effective reward and recognition (R&R) program is part of a compelling total rewards offering that engages employees and drives business outcomes. Despite awareness of the importance of R&R, many organizations struggle to create and implement a successful program. To support members in their efforts to create a more effective program, this report provides the Roundtable’s key findings on R&R drawn from a membership survey.
D EFINITIONS AND S COPE OF R ESEARCH
Data collection for this report occurred through a survey of 27* member organizations with R&R programs. Pages 6–8 also contain data from the Roundtable’s 2007 survey on compensation plan design. The table below provides relevant definitions and outlines the scope of the analysis : Definitions
Reward Recognition Refers to cash, trips, and other gifts given Refers to acknowledgement via an e-mail, public ceremony, thank you card, plaque, or other means Refers to situations in which a formal process is used to reward/recognize, including some level of approval by leadership (manager and above) Refers to occasions when an approval process is not needed to reward/recognize
Formal R&R Informal R&R
Scope of Analysis
R&R for Performance § § § § § § § § § § § § § § Individual Team Managerial/leadership Cost saving ideas Customer satisfaction/service Embodying company culture Innovation Length-of-service Safety Commitment to the environment Community service Bonus awards Stock grants Sales incentives
Included in Report
R&R for Contributions to the Organization
R&R for Contributions Outside the Organization Not Included in Report Base or Variable Compensation
*Please note that not all organizations responded to every question and that the number of respondents (N) is indicated throughout the report. Also, where percentages total more than 100%, participants were asked to select all answer choices that apply.
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K EY FINDINGS
EXECUTIVE S UMMARY
To help members design and implement an R&R program that effectively motivates and engages employees, this page outlines the Roundtable’s findings regarding the key steps of the process, including designing the program, establishing ownership and allocating resources, providing training and communicating the program, and measuring and managing the program. The Roundtable used these steps, which are based on the standard approach to designing, implementing, and managing any program, as the framework for our work. The following pages provide a more detailed overview and include benchmarking information for each step.
PHASE 1: PROGRAM DESIGN
Design and implement a program that will effectively engage employees and achieve business objectives.
PHASE 2: OWNERSHIP & RESOURCES
Establish program ownership and allocate resources to effectively implement and manage the program.
Action Steps and Key Findings þ Select Activities and Behaviors to Reward/Recognize— Organizations most frequently recognize length-of-service and reward individual excellence in role and innovation. þ Incorporate Employee Feedback —Most organizations that collect employee f eedback do so via an employee survey . þ Select R&R Form and Types—Most organizations use all forms of R&R (monetary, non-monetary, formal, and informal). þ Address Global Considerations—More than half of organizations with global programs incorporate local and/or cultural preferences in their programs .
Action Steps and Key Findings þ Determine Program Ownership—More organizations house their R&R program within the compensation department than any other department. þ Allocate Resources—Organizations spend less than 1% of payroll on R&R, and most R&R budget comes either entirely from the corporate budget or entirely from the line unit or department budget. þ Decide Whether or Not to Engage a Vendor—Organizations most frequently engage a vendor for reward packages and thank you/recognition cards.
PHASE 4: M AN AGEMENT AND MEASUREMENT
Ensure employees utilize the program and continually assess its effectiveness over time.
PHASE 3: TRAINING
AND
COMMUNICATION
Maximize program impact and utilization by training managers and effectively communicating the program.
Action Steps and Key Findings þ Select a Method to Ensure That Employees Are Rewarded/Recognized—Organizations most frequently conduct employee surveys to ensure employees are rewarded/recognized, and more than half of organizations track who is rewarded/recognized. þ Measure Program Results—Most organizations that measure the results of their program do so by gauging employee satisfaction and engagement. þ Collect Employee Feedback —Less than half of organizations solicit employee feedback on their R&R program.
Action Steps and Key Findings þ Train Managers on the Program—Organizations most frequently train managers on the reasons for the program and their role in executing it. þ Involve Senior Leadership in Communications — Organizations most frequently involve leadership in announcing the program and award recipients. þ Decide How Frequently to Send Communications—Most organizations send employees f ormal messages about their R&R program either quarterly or annually. þ Select Communication Channels —Organizations leverage less resource-intensive methods of mass communication to communicate their program and the presentation of an award.
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Select Activities and Behaviors to Reward/Recognize
Organizations should select activities to reward/recognize that align with program objectives; these activities should encourage behaviors that drive desired business outcomes. Activities that companies recognize may be different than those they reward. Organizations Most Frequently Recognize Length-of-Service Organizations recognize various actitivies and behaviors through their program , but most frequently recognize activities that visibly impact the bottom line, such as loyalty, great ideas, and individual performance; the greatest percentage of organizations recognize length-of-service (70%), innovation (63%), cost-saving ideas (63%), and individual excellence in role (63%). Meanwhile, fewer organizations recognize activities that may contribute less directly to the bottom line, such as community service (52%), embodiment of company culture (48%), commitment to the environment (41%), and safety (33%). Figure 1 below illustrates the prevalence of recognizing employees for various activities and behaviors.
Figure 1: Prevalence of Recognizing Various Activities and Behaviors (N=27)
Percentage of Organizations 80%
70% 63% 63% 63% 59% 56% 56% 52%
48% 41% 33%
40%
Embodiment of Company Culture
Individual Excellence in Role
Team Performance
Leadership / Managerial Excellence
Customer Satisfaction / Service
Commitment to the Environment
Cost-Saving Ideas
Community Service
0% Length-ofService Innovation
Organizations Most Frequently Reward Individual Excellence in Role and Innovation Organizations reward various types of actitivies and behaviors, but the greatest percentage reward individual excellence in role (74%) and innovation (74%). Although companies most often recognize length-of-service, this is not the most frequently rewarded activity, as it does not necessarily correlate with good performance. Similar to recognition, less than half of organizations reward activities that may not have as direct an impact on the bottom line, such as embodiment of company culture (48%), community service (41%), commitment to the environment (22%), and safety (19%). Figure 2 below depicts the prevalence of rewarding employees for various activities and behaviors.
Figure 2: Prevalence of Rewarding Various Activities and Behaviors (N=27)
Percentage of Organizations 80%
74% 74% 70% 70% 67%
63% 56% 48% 41%
40%
22% 19%
Embodiment Company Culture
Individual Excellence in Role
Team Performance
Customer Satisfaction / Service
Leadership / Managerial Excellence
Commitment to the Environment
Cost-Saving Ideas
Community Service
0% Innovation Length-ofService
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Safety
Safety
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Incorporate Employee Feedback
Organizations should incorporate employee feedback in order to reward and recognize in a way that motivates and engages the employee segments targeted by the program (i.e., non-exempt employees, executives, new hires). Companies may collect employee data from external sources or through internal surveys and/or focus groups. Most Organizations Collect Employee Feedback Via an Employee Survey When Designing Their Program When designing their program, most organizations (85%) solicit some type of employee feedback to understand how employees want to be rewarded/recognized. The most common method for gathering employee feedback during the design process is conducting an employee survey, likely because surveys are relatively low-resource methods of collecting actionnable data to guide R&R program design. Fewer organizations use employee focus groups and advisory groups/committees to gather employee feedback. Figure 3 below illustrates the prevalence of using a certain method (or methods) to solicit employee feedback.
Figure 3: Methods for Collecting Employee Feedback When Designing an R&R Program (N=23)
Percentage of Organizations
78%
Collecting Feedback Because different employee segments have different preferences , organizations should ask employees about their preferences for the following: § § § § Formal vs. infomal R&R Monetary vs. non-monetary R&R Types of R&R (e.g., length-of-service, team awards, CEO awards) Activities rewarded/recognized (e.g., comittment to the environment) R&R prizes (e.g., jewelry, trips, plaques) R&R delivery mechanism (e.g., meeting with manager, annoucement at ceremony)
80%
43%
40%
17% 17%
Other tools used: § Feedback already submitted on the current program § Market research
0% Employee Survey Employee Focus Groups Employee Advisory Group / Committee Other
§ §
Select R&R Form and Types
Based on the program ’s objectives, employee feedback, and available resources, organizations should select the appropriate R&R form (i.e., formal, informal, monetary, non-monetary) and type (e.g., service awards, peer awards). Most Organizations Use All Forms of R&R Organizations use a combination of formal, informal, monetary, and non-monetary methods to reward/recognize employees. All organizations use formal methods, and almost all (96%) offer monetary R&R. Slightly fewer organizations leverage non-monetary methods (85%) and informal R&R (78%). The following figure depicts the prevalence of the four forms of R&R:
Figure 4: Prevalence of R&R Forms (N=27) Examples of monetary R&R include cash and gift certificates ; examples of non-monetary R&R include plaques and thank you cards.
Formal* Informal* Monetary Non-Monetary 0% 50% Percentage of Organizations
85% 78%
100%
96%
100%
*See page 2 for definitions
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Select R&R Form and Types (Continued)
Most Organizations Use a Combination of Formal and Informal R&R Most organizations use both formal and informal methods of R&R, yet vary in degree of use. None of the surveyed organizations use only informal R&R in their program, and although it would be easiest to ensure that formal R&R is administered consistently across the organization, only 11% indicate they exclusively use formal R&R. As demonstrated in Figure 5 below, most organizations rely on some mix of both formal and informal methods of R&R, with the largest percentage (41%), using equal amounts of both. This is likely because formal R&R is by definition limited to a smaller percentage of high-performing employees, yet organizations realize the importance of ensuring that all employees feel recognized and appreciated for their contributions.
Figure 5: Extent to Which Organizations’ Programs Use Formal and Informal R&R (N=27)
Percentage of Organizations 50%
41% 33%
25%
15% 1% 1 0%
0% Entirely Formal Mostly Formal Equal Amounts of Formal and Informal Mostly Informal Entirely Informal
Employees Prefer That R&R Include Monetary Awards According to the results of the Roundtable’s 2007 survey on compensation plan design, employees value programs that include some type of monetary R&R more highly than programs that do not. In fact, they most value programs that offer smaller amounts of money to a large number of people (25% of employees awarded $1,000) or a much larger amount to just a few people (5% of employees awarded $5,000). Figure 6 below depicts perceived value for various types of R&R programs as a percentage of the maximum value possible.
Figure 6: Perceived Value of Various Types of R&R Programs as a Percentage of Maximum Value
$5,000 to 5% of Employees 37%
No Formal Programs 2% Recognition Without Cash Award 5% $1,000 to 5% of Employees 22%
$1,000 to 25% of Employees 34%
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Select R&R Form and Types (Continued)
Organizations Offer Various Types of R&R As Figure 7 demonstrates, organizations employ multiple types of R&R, but most frequently offer company celebrations (85%) and spot awards that require approval from leadership (85%). Few organizations (11%) incorporate a points system in their program in which employees earn points towards items in a catalogue or spending cards. However, a points system may be a potential solution to the challenges of ensuring that the program is fair and equitable across locations and that employees are motivated by their prizes. All of the participants offer at least one of the types of R&R listed below and most offer more than one.
Figure 7: Prevalence of Using Various Types of R&R to Reward/Recognize Employees (N=27)
Percentage of Organizations
90%
85%
85%
78%
70% 56% 52%
Participants offer four to five R&R types on average.
45%
15% 1% 1
0% Company Spot Awards Celebrations that Require (Annual Parties, Approval from Picnics, etc.) Leadership (Cash , Tickets, Gifts, etc.) Ceremonial Awards (Dinners, President’s Award, etc.) Ongoing Recognition (Birthday Celebrations, Thank You Cards, etc.) Peer Awards Spot Awards Requiring No Approval Raffle Prizes Points System
For Their Spot Awards Program, Organizations Most Frequently Offer Cash Awards According to the results of the Roundtable’s 2007 survey on compensation plan design, those organizations that offer a spot awards program most frequently offer cash awards as the prize (92%). This is likely because employees prefer to receive cash, as it may be used towards whatever they most value or need. More than half of organizations (68%) offer gifts certificates and a smaller percentage offer consumer products and additional paid-time-off (PTO). Figure 8 below depicts the prevalence of offering different types of spot awards.
Figure 8: Prevalence of Offering Different Types of Spot Awards (N=37)
Percentage of Organizations
100%
92%
68%
50%
22% 16% 3%
Organizations may also offer restricted stock as a spot award.
0% Cash Gift Certificates Consumer Additional PTO Products (TVs, iPods, etc.) Other
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Select R&R Form and Types (Continued)
For Their Spot Awards Program, More Than Half of Organizations Offer Awards That Are Less Than $500 in Value According to the same Roundtable analysis , more than half of organizations with a spot awards program offer awards valued between $1 and $500 (57%). However, a significant portion give awards that are between $500 and $1,000 in value (38%). Figure 9 below depicts the typical value of spot awards given by organizations that participated in the Roundtable’s 2007 study.
Figure 9: Typical Value of Spot Awards (N=37)
40% Percentage of Organizations
57% of organizations give awards valued between $1 and $500
38%
22%
20%
19% 16%
5%
0% $1–$100 $100–$200 $200–$500 $500–$1000 $1000 or more
Return on Investment (ROI) on Spot Award Spend Decreases Past $500 The same analysis reveals that the value employees perceive they gain from a spot award grows as the value of the award they receive increases. However, organizations must balance employees’ perceived award value with the cost of the award itself. Although one would anticipate that ROI would double each time the award amount doubles, this is not always the case. As depicted below in Figure 10, an organization receives less relative value each time the award doubles in value above $500.
Figure 10: ROI on Spot Award Spend (N=12909)
% Change in Value/Change in Cost 50%
25%
0% $0 $500 $1,000 Spend in U.S. Dollars Projected Increase in ROI Actual Increase ROI $1,500 $2,000
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Address Global Considerations
International organizations must decide how to administer a program on a global basis. A few major challenges specific to a global program include deciding whether or not the activities rewarded, the types of R&R offered, and the awards given will be the same globally. Ensuring that the program is fair and equitable is also difficult, and organizations may consider solutions such as incorporating local preferences in the program and adjusting monetary awards for different currencies. This section provides benchmark data on how international organizations approach these challenges. Challenge #1: Deciding Whether or Not to Reward/Recognize the Same Activities Across All Locations Organizations with Global Programs Tend to Reward/Recognize Mostly the Same Activities at All of Their Global Locations As Figure 11 illustrates , 88% of participating organizations reward/recognize mostly the same or entirely the same activities across all of their global locations. Only 12% of organizations reward/recognize mostly different, or entirely different, activities. In this way, organizations achieve some level of program consistency across all locations , but may also incorporate any special objectives they have for particular locations.
Figure 11: Are the Same Activities Rewarded/Recognized Across All Global Locations? (N=16)
Percentage of Organizations 70%
63%
35%
25% 6% 6%
0% All the Same Mostly the Same Mostly Different All Different
Challenge #2: Deciding Whether or Not to Offer Similar Types of R&R Across All Locations Organizations with Global Programs Tend to Offer Similar Types of R&R at all of Their Global Locations Organizations with global programs typically offer the same, or mostly the same, types of R&R (e.g., peer awards) across all of their global locations . As Figure 12 depicts, 81% of organizations offer mostly the same or entirely the same categories of R&R. Only 19% of organizations offer categories that are mostly or entirely different. Again, incorporating a few slight differences allows organizations to ensure their program is globally consistent, yet locally relevant.
Figure 12: Are the Categories of R&R Offered the Same Across All Global Locations? (N=16)
Percentage of Organizations 60%
50%
31%
30%
13% 6%
0% All the Same Mostly the Same Mostly Different All Different
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Address Global Considerations (Continued)
Challenge #3: Deciding Whether or Not to Give the Same Awards at All Locations Organizations with Global Programs Tend to Give Similar Awards at all of Their Global Locations Organizations with global programs typically give the same, or mostly the same, awards across all of their global locations (i.e., the award given for length-of-service at one location is the same as the award given at another location). As Figure 13 depicts, 69% of organizations give awards that are mostly or entirely the same at all of their global locations. Only 31% of organizations give awards that are mostly or entirely different. Variation in awards given may be the result of local availability or organizational attempts to ensure that the program is fair and equitable across locations (i.e., employees in one region and/or country may not value a particular award as highly as employees in another region and/or country).
Figure 13: Are the Actual Awards Given the Same Across All Global Locations? (N=16)
60% Percentage of Organization
50%
30%
19%
25%
6%
0% All the Same Mostly the Same Mostly Different All Different
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Address Global Considerations (Continued)
Challenge #4: Ensuring the Program is Fair and Equitable Across All Locations More Than Half of Organizations with Global Programs Incorporate Local and/or Cultural Preferences in Their Programs Accounting for local and/or cultural preferences not only helps ensure that a global R&R program is fair and equitable across locations, but also helps ensure that rewards are more personalized, and therefore more meaningful to the recipient. As Figure 14 demonstrates, most organizations with global programs (69%) incorporate some local and/or cultural preferences in their program. For those organizations that do, the greatest percentage do so by tailoring the actual award given. Figure 15 below illustrates the prevalence of incorporating local and/or cultural differences into a portion (or portions) of the R&R program.
Figure 14: Do You Incorporate Local and/or Cultural Preferences in Your Program? (N=16) Figure 15: Prevalence of Incorporating Local and/or Cultural Differences in Different Parts of the R&R Program (N=11)
Percentage of Organizations 60%
55% 45% 36%
Yes 69%
No 31%
30%
27%
0%
Gi Ty ve pe n of Re wa rd/ Re co gn itio n Ac tivi ty Re wa rde d for Se lec tio n Cr ite ria
More Than Half of Organizations Adjust Monetary Awards for Different Currencies As Figure 16 demonstrates, more than half of organizations with global programs (62%) adjust monetary awards where currencies differ, helping to ensure the program is fair and equitable across the company. Although many companies do this, a large percentage (38%) do not adjust monetary awards for different currencies and therefore recipients of the same award receive amounts that are unequal in value.
Figure 16: Do You Adjust Monetary Awards for Different Currencies? (N=16)
Yes 62%
Ac tua lA wa rd
No 38%
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Determine Program Ownership
After deciding what the program should look like, organizations must decide how the program will be managed, which department will house it, and who will own it to effectively implement the program. The Majority of Surveyed Organizations Take a Centralized Approach to Managing Their R&R Program Most organizations (64%) have a program that is managed more by headquarters than by business units or departments; only 20% have a program managed more at the business unit or department level. This may help organizations ensure that the program is administered and used cons istently across the organization and across all locations. Figure 17 below depicts the prevalence of various approaches to managing an R&R program.
Figure 17: Approaches to Managing R&R Programs (N=25) Managing a Global Program
Percentage of Organizations 50%
44%
64% of organizations have a program primarily administered from headquarters
25%
20% 16% 12%
20% of organizations have a program where decisions are made primarily at the business unit or department level
8%
For those organizations that have a global program (N=16): § 63% have a program primarily administered from headquarters § 25% have a program where decisions are made primarily at the business unit or department level § 13% have a hybrid model
0% Centralized Somewhat Centralized Hybrid Somewhat Decentralized Decentralized
More Organizations House Their R&R Program Within the Compensation Department Than Any Other Department Half of surveyed organizations (50%) house their R&R program within the compensation department, likely reflecting the view that R&R is part of the total compensation package. For those that do not, the program is usually housed either within HR more generally, or is owned by two separate departments. When a program is owned by two departments, one department will likely administer some portions of the program (e.g., service awards) and another department will administer others (e.g., performance awards). Figure 18 below illustrates the prevalence of ownership by various departments.
Figure 18: Departments Within Which Organizations House Portions of the R&R Program (N=26) Other functions that may have ownership over portions of the program: § Benefits § Corporate Communications and Marketing § Finance § Organizational & Staff Development § Various Business Units
Percentage of Organizations
60%
50%
30%
15% 12% 12% 8% 4%
0% Compensation HR Compensation and Another Function Another Function Compensation and HR HR and Another Function
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Determine Program Ownership (Continued)
Most Organizations Have a Position or Team At Headquarters That Manages Their R&R Program As Figure 19 depicts, most organizations (93%) have a designated position or team at headquarters that owns their program, which may help ensure accountability for R&R, as well as program consistency. HR generalists, line managers, and coordinators at the local or business unit level also have partial ownership over the program at some organizations. For those companies that have more than one employee at headquarters managing their program, the average number of staff dedicated to that team is 4.85 people. Moreover, larger organizations do not necessary have larger teams; a few of the smaller organizations in our sample have the greatest number of employees at headquarters dedicated to R&R.
Figure 19: Prevalence of Some R&R Ownership by Various Parties (N=27)
The average team or staff size at headquarters is 4.85 people (N=10).
Percentage of Organizations 60%
56%
37%
Other groups that may have ownership over portions of the program: § Departmental Administrative Assistants § Executive Assistants § Local Coordinators § OD Leaders
22%
30%
1% 1 1% 1
0% Designated Team or Staff at Headquarters Designated HR Generalists Line Managers Position at That Work with Headquarters the Line Some Other Group
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Allocate Resources
After establishing program ownership, organizations must determine spending levels for the program and decide where the budget for the program will come from (e.g., corporate budget, department budget, chargeback to department). Organizations Spend Less Than 1% of Payroll on R&R Organizations must allocate enough resources to fund the various elements of their program, including awards , administration, communication, and measurement. On average, surveyed organizations spend 0.62% of payroll on R&R annually. Per employee, they spend approximately $297.67 annually in U.S. dollars. Those organizations that spend higher amounts on R&R may be leveraging their program as a larger component of their overall compensation strategy, making tradeoffs between R&R, base pay, bonuses, etc. Figure 20 below depicts the percent of payroll that several of the participants spend on R&R and also details how much a few of the participants spend on R&R annually per employee in U.S. dollars.
Figure 20: Resources Spent on R&R Annually Percent of Payroll Spent on R&R Total and By Category Total (N=10) Average: 0.62% Range: 0.03%–1.0% Reward (N=10) Average: 0.50% Range: 0.03%–1.5% Recognition (N=3) Average: 0.51% Range: 0.03%–1.0%
Amount Spent on R&R Per Employee in U.S. Dollars (N=6) Average: $297.67 Range: $125–$518
Most Organizations’ R&R Budget Comes Either Entirely Fr om the Corporate Budget or Entirely From the Line Unit or Department Budget More than half of organizations (59%) indicate that there is not shared budget responsibility for their R&R program; budget comes either entirely from the corporate budget, or entirely from the line unit or department budget. Such an arrangement may be designed for convenience, or may reflect differing philosophies on R&R. Although it is less common for organizations to split the budget between the corporate and department budgets , approximately 28% of organizations split the costs in this way. Figure 21 below illustrates the prevalence of allocating R&R program budget from different sources at the participating organizations.
Figure 21: Source of R&R Budget at the Participating Organizations (N=22)
40% Percentage of Organizations
32% 27%
20%
14% 9% 5% 14%
0% Entirely Corporate Mostly Corporate Half Corporate Mostly Line Unit and Line Unit or or Department Department Entirely Line Unit or Department Mostly or All Chargeback to Line Unit or Department
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Decide Whether or Not to Engage a Vendor
While assigning program ownership and allocating resources, organizations may decide to engage a vendor to support a portion of their program. Major challenges with implementing an R&R program that might necessitate the use of a vendor include infrastructure support (e.g., electronic nomination and tracking software) and providing awards and recognition cards, such as thank you cards. However, some organizations also use a vendor to design their entire R&R program. Most Organizations Use a Vendor to Support their R&R Program Since organizations may not have the proper infrastructure in place to implement an R&R program, and most likely do not produce employee awards themselves, the majority of surveyed organizations (74%) use a vendor to support some portion of their R&R program. As Figure 22 demonstrates, approximately one-quarter of organizations (26%) house all aspects of R&R within the organization. A sample list of the vendors participants use in conjunction with their R&R program is also included below.
Figure 22: Do You Use a Vendor to Support a Portion of Your R&R Program? (N=27)
Vendors Used by Participants for Some Portion of Their R&R Program § § § § American Express Birkenstock Custom Design Marketing Excellence in Motion Geiger Bros. Giftcertificates.com Globoforce Grass Roots Hallmark Insights § § § § § § § Hewitt Associates Journeymasters Kreyer Associates OC Tanner Rideau Recognition Solutions Springbok Services Strategic Meetings Solutions
Yes 74%
No 26%
§ § § § §
Organizations Most Frequently Engage a Vendor for Reward Packages and Thank You/Recognition Cards Although there is no one step in the process for which the majority of organizations engage a vendor, organizations most frequently engage a vendor to create reward packages (40%), such as trips or tickets, and thank you/recognition cards (40%), as these are difficult to create internally, but are likely to be a part of most programs. Although most organizations do not engage a vendor to develop electronic approval software, a points system, or electronic tracking software, this may be because they are not using these at all. Figure 23 below depicts the prevalence of engaging a vendor for different portions of the R&R process.
Figure 23: Portions of the Process for Which Organizations Engage a Vendor (N=20)
Percentage of Organizations
50%
40% 40% 35% 25% 25%
Organizations may also engage a vendor to provide small gifts.
25% 25% 20%
25%
0% Reward Packages Thank You / Recognition Cards Electronic Nomination Software Electronic Tracking Software Other Points System Program Design Electronic Approval Software
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Train Managers on the Program
After determining program ownership and allocating resources, organizations must effectively communicate the program ; even the best designed program will have minimal impact unless it is well communicated. Since managers play a key role in employee communications, it is important to train them on the program so they can effectively relay messages about the program to employees. Also, if managers understand the drivers behind the program, they will be more likely to engage employees in the process. Organizations Most Frequently Train Managers on the Reasons for the Program and Their Role in Executing It As Figure 24 demonstrates, more than half of organizations (65%) train managers on some aspect of the R&R program. In fact, of those organizations that provide some type of training, 100% train managers on the reasons for the program. Organizations also frequently train managers on their role in the program and how to communicate the program. This helps organizations ensure that managers understand the program and can effectively reinforce and promote it. Figure 25 below depicts the frequency with which organizations train managers on various aspects of the R&R program.
Figure 24: Do You Train Managers on Some Aspect of Your R&R Program? (N=26)
Percentage of Organizations
Figure 25: Aspects of the Program for Which Organizations Provide Managers with Training (N=17)
100% 88% 76% 65% 47%
100% 50% 0% Reasons for the Program
Yes 65%
No 35%
Their Role in the Program
How to Communicate the Program
How to Reward / Recognize Effectively
How Frequently to Reward / Recognize
Involve Senior Leadership in Communications
Involving senior leadership in program communciations demonstrates organizational commitment to the program and reinforces the importance of engaging in behaviors and activities that are rewarded/recognized. Leadership is Most Frequently Involved in Program Communications by Announcing the Program and Award Recipients Eighty-five percent of organizations involve senior leadership in the communication of their R&R program, and of those that do, leadership is typically involved in announcing the program (74%) and announcing award recipients (70%). Less than half of organizations (43%) engage senior leadership in reminding employees to use the program, most likely due to the time it would require. Figure 26 depicts the prevalence of including senior leadership in different parts of the communication process.
Figure 26: Prevalence of Including Senior Leadership in Different Parts of the Communication Process (N=23)
Percentage of Organizations 80%
74% 70% 43%
Senior leadership may be guests of honor at annual ceremonies or involved in department level programs.
13%
40%
0% Announcing the Program Announcing Award Recipients Reminding Employees to Use the Program Other
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Decide How Frequently to Send Communications
When crafting R&R communications, organizations must decide how frequently to send employees messages about the program. Inconconsisent or infrequent communications may reduce perceived organizational commitment to the program, or fail to remind employees often enough to foster commitment to the program. Most Organizations Send Employees Formal Messages About Their R&R Programs Either Quarterly or Annually Most organizations (80%) send formal messages (e.g., send e-mails, have information sessions) about their program to employees either quarterly or annually. Those organizations that send messages to employees annually may not be fully leveraging communications to promote the program and reinforce the behaviors they seek to encourage. Although organizations should avoid sending R&R messages so frequently that they are considered spam, they must send communciations frequently enough to demonstrate commitment to the program. Figure 27 below illustrates the frequency with which organizations send employees formal messages about their program.
Figure 27: Frequency with Which Organizations Send Employees Formal Messages About Their R&R Programs (N=20)
50% Percentage of Organizations
80% of organizations send formal messages either quarterly or annually
45%
35%
25%
15%
5% 0%
0% Weekly Monthly Quarterly Annually Varies
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Select Communication Channels
Organizations must select the channels they will use to communicate the program and to communicate that an award has been given, balancing the ease of using technology-based mass communications with the impact of using more personal, live channels. Organizations Leverage Less Resource-Intensive Mass Communications to Communicate their Program To communicate their program to employees, organizations rely on less resource-intensive channels that allow for widespread communications, often involving mass-customizable technology. For example, as Figure 28 demonstrates, organizations most frequently leverage the company intranet and organization-wide e-mails, which are easily-customized and reach a large number of employees. Of the written and live channels, organizations most often select those channels that have the widest impact and involve little resource investment, such as department-led information sessions and the company newsletter.
Figure 28: Prevalence of Using Different Channels to Communicate the Program (N=27)
Live Channels
Manager-Led Information Sessions Public Announcements at Meetings
30%
33%
Department-Led Information Sessions
44%
Written Channels
Mail Posters
15%
26%
Notices on Bulletin Boards Company Newsletter
37%
44%
Technology-Based Channels
Organizations tend to use low -resource channels that reach the greatest number of employees to communicate their program, such as the company intranet and company-wide e-mails.
Podcasts
7%
Organization-Wide E-mails Company Intranet
63%
96%
Other (Combination of Channels or It Varies) 0%
15%
50% Percentage of Organizations
100%
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Select Communication Channels (Continued)
Organizations are More Likely to Use Live Channels to Communicate the Presentation of an Award The most common method for communicating the presentation of an award is the company intranet. However, as Figure 29 demonstrates, other written and technology-based channels are used less frequently during this phase as compared with the initial program communication (see Figure 28). Relying more heavily on personal, live communication channels to communicate that an award has been given allows organizations to demonstrate commitment to the program by investing time and resources in it. Personal interactions also allow for more elaboration on the meaning and influence of recipients’ actions.
Figure 29: Prevalence of Using Different Communication Channels to Communicate That an Award Has Been Given (N=26)
Live Channels
Public Announcements at Meetings Department-Led Information Sessions Manager-Led Information Sessions
37%
37%
Live channels are used more frequently to communicate that an award has been given than during initial program communication.
41%
7%
Written Channels
Posters
7%
Notices on Bulletin Boards
7%
Company Newsletter
37%
Technology-Based Channels
Mass communication channels are used less frequently to communicate that an award has been given than during initial program communication.
Podcasts Organization-Wide E-mails
0%
33%
Company Intranet
59%
Other (Combination of Channels or It Varies) 0%
30%
30% Percentage of Organizations
60%
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Select a Method to Ensure that Employees Are Rewarded/Recognized
Organizations may select a mechanism (e.g., a centralized tracking system ) to ensure that the program is properly utilized and that employees are rewarded/recognized. This is especially appropriate for global organizations where awards are administered at the local level, or in situations where leadership does not approve and administer all awards. Organizations Most Frequently Conduct Surveys to Ensure Employees are Rewarded/Recognized As Figure 30 demons trates, most organizations (78%) have at least one method of ensuring that employees are rewarded/recognized, and most frequently employ an engagement survey. Such surveys not only indicate the extent of program use, but how meaningful and effective the program is as well. As Figure 31 demonstrates, other common methods for ensuring that employees are rewarded/recognized include asking managers to share the ways they reward and recognize employees and using a centralized tracking system.
Figure 30: Do You Have a Mechanism for Ensuring that Employees Are Rewarded/Recognized? (N=27)
Yes 78%
No 22%
Figure 31: Methods Used by Organizations to Ensure Employees are Reward/Recognized (N=21)
Percentage of Organizations
80%
71% 62% 57% 38% 24%
Other methods used: § HRBPs remind managers § Leadership takes responsibility § Track nominations
40%
14%
0% Conduct an Engagement Survey Ask Managers Use a All Dedicated to Share How Centralized Funds Must be They Reward / Tracking System Used Within a Recognize Certain Amount of Time Other R&R is Part of Managers’ Competencies / Performance Review
More Than Half of Organizations Track Who is Rewarded/Recognized Although tracking which employees have been rewarded/recognized does not provide insight into whether the program is achieving objectives, it does help organizations ensure that they impact enough employees to make the program meaningful. Since employees must believe that they are eligible for R&R to be engaged in the program, organizations should use a tracking mechanism to ensure they reward/recognize enough employees. Most organizations (88%, N=26), track which employees have been rewarded/recognized for at least some of the rewards and recognition they give.
Percentage of Workforce Rewarded/Recognized Annually On average, surveyed organizations reward/recognize 34.25% of employees annually with their centrally managed program (N=12).
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Measure the Results of the Program
To ensure that the program achieves strategic business objectives, organizations should measure the results of their R&R program using metrics aligned with program objectives. Below is a list of a few program objectives, paired with sample measures of success:
Measures of Success § § § § Employee surveys indicate that the work environment has become more positive as a result of the program Turnover has decreased since the program’s inception The organization moved up in “Employer of Choice” rankings There have been fewer on-the-job accidents since the program’s inception
Program Objectives § § § § Create a more positive work environment Decrease employee turnover Improve the organization’s reputation in the external labor market Reinforce the importance of on-the-job s afety
Most Organizations that Measure the Results of Their Program Gauge Employee Satisfaction and Engagement As Figure 32 demonstrates, more than half of organizations (63%) measure the results of their R&R program. Those that do so most frequently measure employee satisfaction and engagement to gauge program results (94%). Figure 33 below illustrates the prevalence of using a certain method (or methods) to measure the results of the program. However, as mentioned above, organizations should select and track metrics that align with program objectives (e.g., employee retention, number of on-the-job accidents).
Figure 32: Do You Measure the Results of Your R&R Program? (N=27)
Yes 63%
No 37%
Figure 33: Prevalence of Using a Certain Method (or Methods) to Measure the Results of the Program (N=17)
94%
Percentage of Organizations
100%
50%
29% 18% 12%
Other methods used: § Employee participation in the program via number of nominations § Points awarded § Redemption of points for prizes
0% Employee Satisfaction / Engagement Employee Retention Employee Productivity Other
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Collect Employee Feedback to Continually Improve the Program
Since employees must be engaged in the R&R program for it to be successful, organizations should continually gather employee feedback on the program to assess program effectiveness and identify areas for improvement. Less than Half of Organizations Solicit Employee Feedback on Their R&R Program As Figure 34 demonstrates, less than half of organizations (41%) collect employee feedback on their program. However, such feedback may be leveraged to improve the program by pinpointing problem areas (e.g., employees do not know enough about the program, employees are not motivated by the awards themselves, employees would prefer more informal recognition). Organizations may use the following tools to collect employee feeback:
§ § § Focus Groups Interviews Surveys Figure 34: Do You Solicit Employee Feedback on Your R&R Program? (N=27)
No 59%
Yes 41%
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APPENDIX: P ROFILE OF R ESEARCH P ARTICIPANTS
The graphs below depict the industry, revenue size, and employee size of the 27 participants.
Industry of Participating Organizations
Regions in Which Participating Organizations Have an R&R Program
Global, Including North America, 59%
Schools & Educational Services, 11% Retail, 4% Professional Services, 4% Pharmaceutical, 7%
Telecommunications, Consumer Products, 4% 1% 1 Biotechnology, 4%
Energy and Utilities, 4% Financial Services, 21% Health Care, 7%
High-Tech, 19% Heavy Manufacturing, 4%
North America Only, 41%
Employee Size of Participating Organizations
Revenue Size of Participating Organizations
50,000–100,000, 19%
Over 100,000, 7% 2,000–10,000, 30%
Over $10 billion, 33%
$500 million– $2 billion, 11%
10,000–50,000, 44%
$5 billion–$10 billion, 15%
$2 billion–$5 billion, 41%
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K EY FINDINGS
NOTE TO MEMBERS: This project was researched and written to fulfill the research request of several members of the Corporate Executive Board and as a result may not satisfy the information needs of all member companies. The Corporate Executive Board encourages members who have additional questions abo ut this topic to contact their research manager for further discussion. The views expressed herein by third-party sources do not necessarily reflect the policies of the organizations they represent. PROFESSIONAL SERVICES NOTE: The Compensation Roundtable (CR™) has worked to ensure the accuracy of the information it provides to its members. This project relies upon data obtained from many sources, however, and the CR cannot guarantee the accuracy of the information or its analysis in all cases. Furthermore, the CR is not engaged in rendering legal, accounting, or other professional services. Its projects should not be construed as professional advice on any particular set of facts or circumstances. Members requiring such services are advised to consult an appropriate professional. Neither Corporate Executive Board nor its programs are responsible for any claims or losses that may arise from any errors or omissions in their reports, whether caused by Corporate Executive Board or its sources.
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