Can bringing dedicated interim reward expertise into a growing business help it accelerate still faster?
Some do it at different rates and some want it faster than others but, if there’s one thing that’s common to nearly all expanding businesses, it’s a desire to grow their profits and people.
Factors holding this back can be numerous and, for many smaller companies, one of them can involve not having developed a proper HR function. But an issue we’re finding that is beginning to be talked much more often is about factors beyond just HR. We feel achieving growth is not simply about whether a dedicated HR presence is needed (this is arguably regarded as a given), but also whether other specialisms like having a strong expertise in reward is required too. It’s an organisation’s overall reward strategy that in many experts’ minds sets the tone around what a business is about. Moreover, some might argue that it is reward that has greater sway over aspects like attraction and retention – the two things growth is absolutely dependent on.
Of course, many smaller, growing businesses will say they are not large enough to justify a full-time reward professional. But this isn’t the only option available to SMEs and many can under-estimate the value that bringing in an interim reward professional (normally for a period of around six months) can bring to a growing business. In fact, it could be argued that those growing businesses that don’t pay attention to reward issues will struggle to adapt to market and workforce demands as they continue to seek to grow.
The clear benefit is the huge experience reward interims bring. All will have substantial experience working for a number of different types and sizes of organisations meaning they can bring insights and suggest the most appropriate policies to help place a business ahead of its competitors. This is because interims tend to have a much broader range of skills in their pockets – everything from advising on executive compensation, reward strategies for mergers and acquisitions and IPOs through to implementing a robust and cost effective benefits programme.
It can often be forgotten that reward interims can actually be extremely commercial utilising their wealth of expertise to help organisations foster growth through designing long-term incentives and employee share plans – and these are just the sorts of elements investors will deem as essential that businesses have in place, certainly if the business is pre-IPO or seeking more investment for growth. Nowadays all serious investment partners – in addition to future or current employee s- want proper reassurances that the business they are looking at is conducting itself properly and has the right standards in place for future-proofing itself; or at least minimising the risks associated with growth. It’s also worth remembering that the cost of having an interim is very competitive when compared to the cost of other external advice. The real benefit of having a dedicated resource affords key stakeholders such as the CEO, FD or HRD more quality time with the interim. Furthermore, having the interim onsite during periods of rapid growth – especially with acquisitions – is invaluable.
Having access to such a wide range of skills means robust reward strategies can be established, along with all the right measures and processes to allow the SME to continue rewarding their staff in the best way possible long after the interim has moved on to pastures new. Their initial presence may only have been temporary, but the impact they will have had will be much longer lasting.
The dispassionate expert
But there are other, less tangible (but just as important) reasons why growing businesses really do need to consider interim reward experts. A benefit that’s sometimes hard to place a value on is the ‘dispassionate expert’ role that interims play. This, though, can often be their most valuable contribution.
Reward professionals feel very passionately about what they do but, as outsiders, interims see the business in terms of what it needs. Often they are vital to act as the bridge between the CEO, CFO or HRD and they can be an important source the hierarchy can trust. A reward ally can rubber-stamp policies that were already being suggested or act as a sounding board for HR to increase its own visibility internally.
Interims add almost instant value because they will do their dispassionate diagnoses very quickly. They also thrive on the challenge of dealing with ambiguity and change – something that may sometimes have held those internal to the business back. When reward design is being looked at for the very first time, reward interims see the bigger picture in terms of designing policies that will attract and retain the best talent.
Good interims will add professionalism to SMEs, remove repetitive or time-intensive practices and strike the balance between understanding regulation but also different organisational cultures.
In hiring them, growing businesses do need to accept that they are asking for help and advice and that the counsel of the specialist should be listened to. Hiring an interim may seem like a large upfront cost initially but they will have been brought in for a reason. It’s highly likely many growing SMEs may not know exactly what a good and effective reward strategy looks like, so they are buying advice and access to lots of other solutions to essential processes. For instance: harmonisation of roles; engagement; leadership; determining where commercial value comes from; even undertaking crisis management – these are just some of the additional insights these professionals are able to bring to the table.
Conversations about human capital are starting to appear in the investment community. The likely emergence of greater data (and what to do with it) in organisations is becoming an issue while demand for better return on investment from all areas of the business is growing. Some high-tech firms are now having to change their business models on almost a quarterly basis just to keep up with these demands. But that’s why the machinations of reward can’t be ignored. Getting it right is now vital to business growth. Growth simply can’t be done without it because growth means people and people need to know that they are being valued.