'There is a lot of planning that goes into it, there's a lot of modelling that goes into it,' says CPO AnnMarie Mercer
In the wake of similar announcements south of the border, Walmart Canada announced this week that it raised the wages of approximately 40,000 store associates – an investment of $53 million that the retail giant said will “ensure attractive pay in the markets they operate.”
Planning anything at such a large scale presents its challenges, especially when it comes to communicating, says Walmart Canada CPO AnnMarie Mercer.
“How do you help 100,000 associates understand?” Mercer says. “When you have a workforce that's as large scale as ours, with various different working hours, etcetera, how do you communicate on scale?”
In an environment where communication with store associates is largely verbal and one-to-one, Mercer says there has been investment in bringing digital information to workers in the form of interactive formats, either on phones or on boards in the stores.
“We're in the early stages of some of this. But how do you have information at an associate’s fingertips, when and how they want to access information?”
Large scale raises planned with end user in mind
In discussing how the organization prepares for and engages the workforce for across-the-board compensation, Mercer points out that the experience of the sales associate is the end goal of this strategy and others like it.
“In a post-COVID world, the way our customers shop and how they interact with us was changing,” Mercer says.
“There is a lot of planning that goes into it, there's a lot of modelling that goes into it. There's a lot of input, we test different models. … this goes well beyond just the wage investment, but it could be any change that we're looking to make, to make sure that we understand the end user – what are they going to receive?”
Using customer experience as a starting point, Mercer’s team accesses a “spectrum” of data such as engagement surveys and “grassroots sessions” held with direct leaders and managers to gather feedback, plus constant benchmarking for market relevance, to determine appropriate compensation and benefits strategies.
“What are the skills and capabilities that we require for the future? Do we have the right value proposition for our associates, based on who we are as an organization, where we look to position ourselves as an organization?”
Transparency and communication essential when rolling out raises
When rolling out compensation changes, especially with larger organizations, transparency is a non-negotiable for employers, says Sara Mahabadi, assistant professor of strategy and management at the Alberta School of Business.
“Employees like to see that they are rewarded for the work that they're providing, but also, inherently, human beings tend to compare themselves with others,” says Mahabadi. “This is very prevalent in organizations, in big organizations. We compare ourselves to others, and we would like to see how and why we are getting more or less than other people.”
The criteria used for determining compensation should be available to employees to view, Mahabadi says, including what the goals are for wage increases, and communicating about why increases are different for different groups of employees. And communication needs to begin far ahead of any changes being made, she adds.
“So I can see, as an employee, I can go and look and check and understand why I'm getting paid this much, and why my colleague or my friend or my cousin who is also working in the same company is getting paid differently,” Mahabadi says.
“This feeling of being treated fairly is really important to make sure that employees are engaged and are giving and performing their best in their jobs, because if I feel as an employee that I'm not being treated fairly and I don't understand why I'm getting less than other people or why I'm behind them, then I will get demotivated, and I'm likely not to be performing well, and I'm also likely to leave the job.”
Going beyond compensation
Walmart Canada’s increases ranged from 30 cents to $1 per hour, Mercer shared, determined according to local market rates and extensive data and market research as well as employee engagement.
Wage increases are obviously valuable in today’s challenging economy, especially considering the current rate of inflation, but employers need to go beyond wages to truly be meaningful for employees, says Ian Gellatly, professor of management at Alberta School of Business.
“From a motivational perspective, an across-the-board raise like this is not likely to impact job performance at all, because it’s not based on performance,” says Gellatly.
“Everyone gets it, regardless if they are a high performer or not. What the raises are based on is current membership in the organization. So, if anything, it might help retain workers in the shorter term. Until something better comes along.”
Raises give employees a “short term high,” Gellatly adds, stating, “what engages us are the relationships we form at work, the quality of our interactions with coworkers, leaders, and customers. Other ways of engaging people is by giving them interesting and meaningful work. Stuff they can be proud of and find fun to do.”
Non-monetary strategies, such as meaningful work, achieving a sense of mastery through skill development, and autonomy over the work they do all have a longer shelf-life in terms of employee engagement, says Gellatly.
“Of course, money is important. Having too little is devastating and life-sucking. However, once your needs are met other things start to take on more importance in the ‘game of hearts’,” he says.
Mahabadi echoes the importance of autonomy at work for employee retention, as well a sense of making a difference to the company’s success and output.
“They feel that they are contributing to an outcome, so they see how much their work is contributing to what the consumer or the end user is using, and also feel that they are respected,” says Mahabadi.
Benefits for a diverse workforce
Walmart’s workforce is diverse, says Mercer, with store associates ranging from teenagers to older generations working in their retirement and beyond. This necessitates a range of benefits to supplement wage and round out compensation, she says.
“The offerings that we provide from a benefits perspective have to be very broad in nature,” Mercer explains. “We also know that we need to … constantly be learning as an organization and upskilling for what those skills are of the future.”
For example, she says, last year Walmart launched its Live Better U Canada, a program that funds employees interested in certification and other education opportunities to advance career development in the company.
“So that way, we're preparing our workforce for the future. Then you layer on from a compensation perspective, our associates being competitively paid … when we look at the benefits and all things related to the associate, to ensure that it's meeting the needs of what they need, as an individual, and then as a family.”
