Case study: How Singtel's enhanced benefits programme led to a 4% profit increase

In 2012, Singtel announced a bold organisational restructure in order to sharpen its customer focus.

To drive this business transformation, the right people were required - for which the right talent needed to be attracted, engaged and motivated through a sound compensation and benefits strategy.

Singtel’s compensation package now comprises not just the basic pay structure based on job roles, but also a variable component that links rewards to an employee’s contribution to business performance.

This also acts as an embodiment of Singtel’s core values.

The package is tied to Singtel’s four guiding principles – alignment of interests with shareholders and support of business transformation; fair and appropriate distribution of rewards; effective implementation to meet rigorous corporate governance requirements and ensure employee understanding; and clear line-of-sight to drive the right behaviour.

The rewards are communicated to employees at the point of employment through regular briefings as well as the company’s intranet.

With Singtel’s senior management taking staff performance and wellbeing seriously, these policies are reviewed regularly against feedback from its staff engagement survey, market trends and legislative changes.

The management also actively seeks input from the Union of Telecoms Employees of Singapore (UTES), and maintains a strong management-union relationship.

In its efforts to continually improve, Singtel conducted a staff survey in early 2014.

Results showed that employees perceived performance management as an onerous exercise, and performance discussions as heavily centred on performance ratings and bonuses, with little emphasis on career development.

Based on this, the team implemented a new performance management platform on its new global One HR system, HRCentral, in 2015.

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HRCentral allows managers to cascade a business objective to the entire team or an individual, creating a clear line of sight for employees in what they have to deliver and how their goals contribute to the overall business success.

The system also contains built-in training guides to help employees set measurable KPIs and engage in meaningful performance feedback and career conversations. The system is open all year round.

The employee-oriented company also further revamped its benefits programme in April 2014 following feedback from an employee survey in 2012.

Its new benefits programme features enhanced medical and insurance coverage. Singtel also collaborated with its healthcare provider to review a list of panel clinics, introduced a clinic locator application, as well as constructed a new in-house clinic at NCS Hub.

The next step was to ensure employees were aware of the changes and the benefits they were entitled to.

To achieve this, Singtel not only summarised its policies on the intranet, but also used animated videos and posters to bring across the value of these benefits. Briefing sessions and roadshows were also conducted.

This wasn’t the only thing on Singtel’s compensation and benefits agenda – in 2014, it launched the Singtel $300 programme, which provides an annual SG$300 bill rebate to offset against Singtel’s service subscriptions. In 2015, the firm renewed the Singtel collective agreement that guarantees base terms and conditions of employment for bargainable employees for the following three years.

In FY2015, Singtel saw a 4% increase in net business profit, and a steady increase in engagement scores from 75 in 2013 to 76 in 2014 to 78 in 2015. At the same time, voluntary attrition was low at 12% compared with an industry average of 14.4%, while the staff advocacy index has steadily improved from 80 in 2013 to 81 in 2014 to 82 in 2015.

Speaking to Human Resources, a piece of advice Ng Kian Khar, director of group rewards at Singtel has is: "given the tight labour market and talent crunch, companies need to think about redesigning compensation programmes or policies to better attract and motivate different segments of the workforce, including those working on a part-time or project basis, as well as encourage mature workers to continue contributing beyond retirement age."

He added that compensation and benefits policies must evolve to be a lot more flexible to cater to the rapidly changing lifestyles of employees.

"Telecommuting and flexible work arrangements will be more prevalent," Ng observed, "and companies will be looking at introducing new and innovative benefits, such as having game rooms or even concierge services for employees, in order to differentiate themselves and enhance employee value proposition."

For more case studies from Astro, SMRT and Avnet, and tips for building a top compensation and benefits strategy, head over to the Human Resources’ March feature.