Leveraging internal and external people data

A well-designed Total Rewards strategy benefits from a diverse array of data sources, including Total Rewards benchmarking, internal HR and payroll data, industry trends, and financial data. These sources provide a comprehensive view of competitive positioning, internal equity, and financial feasibility, enabling organizations to benchmark their offerings, identify gaps, and develop data-driven strategies that align with their business objectives and market conditions.

When making decisions about your Total Rewards program, it is critical to give your workforce a ‘seat at the table.’ Understanding what employees value, want, need, and expect ensures that the rewards package resonates with their priorities, enhances engagement, and optimizes your spend.

But, not all employee feedback is created equal and the nature of the data determines its utility and value. This article provides an overview of common employee feedback sources and insights used in Total Rewards design.

1. Direct employee feedback

The most reliable data come from your own employees, typically gathered via a survey developed specifically for your organization. The survey could include typical questions (e.g., satisfaction with benefits) as well as more advanced, choice-based trade-off questions (i.e., conjoint analysis) to measure employee preferences and priorities.

Benefits:

• Relevance: Data from direct employee feedback can yield specific insights into how your employees perceive and value your organization’s unique culture and current rewards vs. desired rewards offerings.
• Reliability: Surveys designed by reputable experts adhere to scientific standards to ensure that results are dependable, meaningful sources of information.
• Granularity: Feedback can target specific questions, with results segmented by subgroups, such as department, location, role, and tenure, for tailored strategies.
• Actionability: Employee data may enable informed decision-making about investments and improvements to drive better organizational and employee outcomes.
• Advanced Analytics: More sophisticated analyses of employee feedback data include program costs data, such as with the Mercer Rewards Optimizer^®, and highly specific modeling to identify the best return on investment.
• Engagement: Showing employees that their voices matter fosters trust and openness, and can be an important component of a change management process.

Drawbacks:

• Collecting employee data requires an investment of time and budget.
• Success depends on participation and effective communication.
• Optimal use of employee feedback data requires expertise in research methods, analytics, organizational action planning, and change management.

How Mercer can help:

Mercer employs the world’s largest population of employee feedback and measurement experts to consult with you about your employee listening and Total Rewards strategies. Expert-designed, proven tools are available in standard and custom formats to gather the right type of data based on strategic priorities and organizational needs (e.g.,Mercer Rewards Optimizer^®, Unmet Needs Assessment, bespoke Conjoint surveys, and Benefits Satisfaction surveys).

Bottom line:

Direct employee feedback provides the most targeted approach to achieving actionable insights with opportunities for cost optimization and should be at the core of developing your Total Rewards strategy.

2. Employee pulse surveys and digital focus groups

When employee feedback is desired on a recurring basis or when there are emerging needs, organizations use quick, targeted surveys and/or employee focus groups to gain specific feedback and enable a more rapid response to employee concerns and workforce risks.

Benefits:

• Cost-Effective: Pulse surveys and digital focus groups require less time and resources compared to traditional, more comprehensive surveys.
• Speed: They provide quick insights to inform immediate decisions.
• Targeted: They may focus on specific topics, such as a new benefit or policy change.

Drawbacks:

• Limited Representativeness: Smaller samples may not reflect your entire employee population and should not be interpreted as such.
• Superficial Insights: They often yield less depth and context than comprehensive surveys.
• Potential Bias: Some participants may have strong opinions that predominate the discussions, which can skew results without proper precautions.
• Lack of Modeling/Cost Optimization: While pulse surveys and digital focus groups can provide insights on what employees value, they do not offer the ability to model program changes for cost and preference optimization.

How Mercer can help:

Mercer’s Pulse Surveys and Digital Focus Groups enable rapid collection of feedback on specific initiatives or emerging issues, providing you with quick, actionable insights.

Bottom line:

While useful for rapid, tactical adjustments, these sources utilizing pulse surveys and digital focus groups may be best suited as supplementary tools rather than primary decision drivers.

3. Market data and external research

External research and publications such as white papers, research reports, and benchmarking studies offer insights across large comparison populations so that we can learn from trends and patterns in employee preferences across regions, sectors, job levels, and more.

Benefits

• Trend Identification: Analysis of external market data and research may allow you to spot emerging preferences and growing needs, like flexible work or wellness benefits.
• Contextualization: You can compare your internal employee feedback to the broader industry landscape.
• Breadth: The topics and/or specific rewards researched may be different than those you have been able to address with internal feedback, which could provide supplementary insights.

Drawbacks:

• Lack of Specificity: External data sources are unlikely to reflect your organization’s unique culture or circumstances.
• Data Quality: Market data may be outdated or too generalized.
• Limited Actionability: External data often require skilled interpretation to translate into internal strategies.

How Mercer can help:

Mercer provides insights about what is important to employees in research reports such as Inside Employees’ Minds, an annual study of employee perceptions.

Bottom line:

Market research can be useful for broad contextualization and staying up to date on industry trends. These insights should complement, not replace, direct internal employee feedback. External data help you position your rewards competitively but lack the detail needed for decision-making.

4. External sentiment and reputation data from the internet

Using AI tools to scrape and analyze online sentiment about your organization’s reputation can provide insights into external perceptions, including employee sentiment, candidate views, and your public reputation.

Benefits:

• Reputation Data: Online search strategies can help you identify potential issues with your organization’s reputation that might impact talent attraction and retention.
• External Perception: Using these strategies will provide a broader perspective of how your organization is viewed outside of internal surveys.
• Proactive Insights: This approach may allow you to detect emerging issues or misalignments early.
• Low/no impact on employees: This approach does not require direct employee participation.

Drawbacks:

• Surface-Level Data: Online sentiment may not accurately reflect your internal employee experiences.
• Noise and Bias: External factors can influence online sentiment, which may not be directly related to your rewards or culture.
• Limited Specificity: These data are less useful for detailed decision-making when designing Total Rewards programs.

How Mercer can help:

With our vast experience across industries and with companies experiencing all sorts of brand/image challenges, our consultants can provide perspective as well as guide you through developing any action plans related to what you find on the internet.

Bottom line:

Data scraping can provide valuable insights into your external reputation and talent market impacts. However, they are not reliable for rewards adjustments. Think of it as a supplementary strategic tool that informs broader talent and branding initiatives.

Integrating data for smarter total rewards decisions

While your internal employee feedback should be the foundation of your Total Rewards strategy, supplementing with external data and insights can add valuable context. Smaller, targeted surveys and digital focus groups are useful for insights and validation but are not a substitute for more robust research.

In summary:

• Prioritize comprehensive Total Rewards employee feedback for decision-making, as it directly reflects your people’s experiences and preferences.
• Use market research and reports to understand industry trends and ensure your rewards remain competitive.
• Leverage data scraping solutions to keep an eye on your external reputation and talent attraction challenges.
• Employ pulse surveys and digital focus groups for rapid, tactical insights on specific initiatives.

With an integrated approach that considers people data alongside other internal and external data sources, you can craft Total Rewards strategies that are employee-centric, externally competitive, and optimized for spend—fostering engagement, retention, ROI, and overall success.

Looking for ways to better utilize employee feedback? Give us a call at 855-286-5302 or email surveys@mercer.com.