Spring 2011 41

HR features

Staff Social ClubsRewarding staff beyond Friday night drinks

Staff retention is a key component of any company’s HR strategy and when adequately achieved not only helps enhance organisational culture, but can also save companies a large chunk of their annual budget. For employees earning HK$26,000 per month, the average cost of recruiting and training them is now estimated at over a third of a million dollars—so staff retention is more critical than ever.

Daily and long-term benefitsA new kid on the block in Hong Kong, Total Loyalty Company, is now aiming at combining both these functions to design employee loyalty programmes that enhance the work life balance culture of organisations as well as offering well rounded benefits and daily lifestyle privileges to employees. These customised programmes are designed for companies in the form of a staff social club.

Through the club, staff gain access to hundreds of rewards and discounts spanning movie tickets and grocery items to restaurants and holidays. Nothing too extraordinary there, but what makes the social clubs unique is that staff also gain exclusive access to regular social events and fun activities that they can share with their colleagues, friends and family.

Morgan McKinley is one of a growing number of companies throughout Hong Kong which is already embracing this innovative outsourcing solution. Steve Carter, Managing Director from Morgan McKinley said, “Since introducing the Total Loyalty Company social club programme earlier in the year, we’ve received great feedback from staff. The website is easy to use, and is all branded as if we have created the program ourselves. It is an innovative approach to providing a work-life balance solution and we are pleased to be one of the first companies in Hong Kong to adapt it for our staff.”

Only half of HK companies have active social clubOf course the idea of a staff social club is not new in itself, but a recent straw poll survey revealed that 50% of companies surveyed did not have an active staff social club. Of the Hong Kong companies who have incorporated a staff social club into their organisation, 69% recognised that they had helped facilitate better communication between colleagues, a stronger organisational culture and higher staff morale. So why doesn’t every company have a staff social club? Most companies would like a staff social club, however lack the internal resources and/or know-how required to establish and run a successful programme. Interestingly, 73% of companies surveyed said they would consider an outsourced solution to have a staff social club. It is primarily due to this reason the concept behind Total Loyalty Company’s services has done so well in Australia over the last 15 years under the brand of My Rewards® which currently has over a million members.

Sam Lau, the Founder and Managing Director of the company in Hong Kong highlighted the importance of social clubs to organisations. He said, “A staff social club is no longer just for a bit of fun, it is a vital tool for companies of any size, which can be used to build strong relationships within the organisation, involve families of employees, implement personal development activities, and offer everyday lifestyle benefits to really reward loyal employees.”

What makes staff stick?So what are the main staff retention drivers? Some may argue that pay is a significant determinant in an employee’s choice to leave an organisation, however, to many employees there are more important factors to take into consideration when looking to change jobs.

A recent study by Community Business stated that 40% of employees in Hong Kong would consider quitting in the quest for better work-life balance. This comes down to factors such as limited time available to spend with family, extreme stress levels, long working hours, diminished relationships with friends and poor health. If these are your employee’s concerns, simply increasing their pay packet is not going to be an effective retention strategy. Other research has shown that improved benefits packages are an effective way to increase employee loyalty. Offering benefits such as healthcare and life insurance are common non-cash benefits offered by companies. Such benefits are certainly well received by employees, but are they substantial enough on their own to encourage staff retention? Other, more immediate and tangible, everyday lifestyle benefits can also be provided to help further enhance appeal to employees on a daily basis. Social clubs and employee loyalty card schemes are typical means of achieving this, but require a significant investment of time and effort on behalf of HR if they are to be successful. Furthermore, any events and deals sourced may not be significantly beneficial to employees if a company, due to its size, is unable to leverage bulk purchasing power.