The Relative Value of Rewards Advice Scorecard
This scorecard is a simple diagnostic tool, designed to help experienced and inexperienced buyers rapidly determine the relative value of investing in rewards advice.
Relative Value of Rewards Advice = Probability of Improvement x Breadth of Improvement
Investment
- Relative Value: The amount you can reasonably expect to gain from an investment in rewards advice or internal resources.
- Probability of Improvement: Your perspective on the relative chances of obtaining the desired level of success with external or internal capabilities, after making allowances for preventative and contingent action to reduce risk.*
- Breadth of Improvement: Your perspective on the actual tangible, intangible and peripheral benefits to you personally or your organisation i.e. how is the business better off? Or, how am I personally better supported?
- Investment: In the case of the internal resources (the opportunity cost, time, energy and resources etc) and the Reward Adviser (their explicit fees or other remuneration + expenses, and additional management time etc).
* With any improvement there are explicit risks as well as rewards. What we are concerned with is the "Probability of Improvement" after appropriate measures to mitigate risks have been applied. For example, an experienced buyer or adviser will apply various approaches (preventative and contingent) to mitigate against a dramatic increase in their annual healthcare insurance costs (use of excess and deductibles, market insight, premium cost-shifting to employees etc).
If you are unclear or concerned about any of the above issues contact us.
