Kraft Foods spent last year overhauling its reward package following its acquisition of Cadbury in 2010. The US food and beverage giant is now set to decide what, if any, changes it will make to the package after renaming the merged entity Mondelez International, with the new company unveiled in October 2012.
Mondelez , which boasts worldwide brands including Cadbury Dairy Milk, Maynards, Oreo, Ritz, Toblerone and Trident, will also spend 2013 working on refreshing its snacking strategy for consumers and, at some point, aligning this with its reward package.
Masha Boldyreva, reward lead, UK and Ireland, at Mondelez , says: “As much as we aim to create delicious moments of joy for our consumers, there is a lot to be said about the same thing for our employees. When we look at our reward offering, what are the joyful parts of our reward? How are we optimising our brands? It is early days, but we have started to think about it.”
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Integration project
The integration project to harmonise the terms and conditions of 3,500 UK and Irish employees across Kraft and Cadbury took six months in 2011. A steering group, which included business and HR leaders, met to determine the new look of the reward offering.
Boldyreva adds: “Instead of going with one legacy approach or another, we really looked at what ‘good’ would look like, what we wanted to do as a company, what we wanted to say about our holiday entitlement, our work-life balance, and that all determined our offering.”
The resulting strategy won Kraft Foods the title ‘Most effective benefits communication strategy for employers with more than 5,000 employees’ at the 2012 Employee Benefits Awards. It also took home the awards for ‘Most effective use of a flexible benefits plan’ and ‘Benefits team of the year’.
Boldyreva says the communication strategy’s success was due to engaging the company’s leaders in the process and completely redefining the way the reward package was communicated. “We have fantastic marketers for our products, so we looked at our reward from a marketer’s perspective. This changed the way we communicated it because we looked at it as a product,” she says.
“We had a great offering that we designed. We had a really good framework at Kraft Foods at the time: tightly managed, global consistency, excellent technology. We had all those ingredients. Then we asked: what don’t we have? It was the packaging. So we went through a lot of work looking at reward as a product that we had to sell.”
The harmonisation team developed three elements to its communication strategy: it created a brand, it made reward simple and engaging, and it educated company leaders on how to talk about reward. The brand is called Simply Rewards in the UK and Great Rewards across the rest of Europe, rather than being branded after each company name. “Our reward brand is what people remember,” says Boldyreva. “They don’t remember Mondeléz versus Kraft; they remember Simply Rewards.”
Simply Rewards is an online flexible benefits scheme that was launched in 2011 following the harmonisation of the two companies. It was completely new to legacy Kraft Foods staff, but not to Cadbury workers, who had a similar scheme before. The company, along with its provider Benefex, hosted focus groups to find out what employees wanted to see in the new flex offering.
Flex take-up
Simply Rewards includes a health cash plan, holiday purchase, employee discounts, payroll giving and bikes for work. After the launch, flex take-up jumped by 64%, from 1,309 staff in the old Cadbury scheme to 2,144 in the new one.
Simply Rewards’ second enrolment window opened in the first week of November with no changes from the previous year. “We now want to let it run and raise awareness,” says Boldyreva. “We want people to get used to it before we start changing anything. We will need to evolve it, but I would rather evolve it as a result of a strategy decision at the Mondeléz level than tweak it for the sake of tweaking.”
As part of its strategy to make reward simple and engaging, Mondelez created a set of core communications principles, a recipe for how to make technical information simple and how to best communicate the package. It also focused on educating the organisation’s leaders to talk about reward.
The company’s top 120 business leaders were taken off site, briefed on staff terms and conditions, and given an opportunity to discuss the challenges. They were then sent back to their workplaces to have conversations with employees about these. A helpline, which was launched in conjunction with the HR team and Benefex, received 1,000 calls in three weeks.
Employees were briefed at 11 simultaneous meetings in October 2011. They were also given individualised statements that compared their new and old total reward packages. “From that day, they had two one-to-ones with their manager,” says Boldyreva. “One was around whether they understood broadly what it said and, if not, they were directed to the helpline; and the second was to find out if they had any concerns or issues.
“There was a sequence and a real effort around communication. People still talk about it, because it was the first time we had openly and transparently communicated something like this. We didn’t leave anything out. We had nothing to hide. That transparency inspired huge trust.”
Communication exercise
The communication took place between October and the end of December 2011, and employees were asked to sign up for their new terms and conditions. Almost all (98%) signed up before the agreed deadline and were given access to the flexible benefits scheme.
After a successful harmonisation and with an eye to the future for Mondelez International, the reward team’s next task is to begin the conversation about the role of reward in the new organisation, as well as the role of its reward professionals.
“Investment in our people is the biggest investment in our business,” says Boldyreva. “I believe that the reward professional will have to take on quite a new role, and that is the role of a fund manager. If I think about our employee investment as a fund, my job here is to manage that fund.
“I think the reward director should have a seat at the table, like I did during the integration of terms and conditions. I was meeting with the leadership team, and there was a real dialogue and partnership there. I think reward directors should have a view and should challenge the business to think about this investment, because it is theirs as much as the reward function’s, and equally to challenge them to think about our people as an investment, not as a cost.”
The reward team will soon meet to discuss changes Mondelez might make to its reward package. “We will re-examine our total reward offering,” says Boldyreva. “We will ask ourselves: what are we trying to achieve? What are the behaviours we are trying to incentivise? That will probably lead us to a slightly different view around our reward package.”
For now, Mondelez will determine the competitiveness of its reward package compared with other companies in the food and beverage sector. Boldyreva explains: “We have spent quite a bit of time on integration, looking at ourselves within. We needed to spend a bit more time looking outside. My team and I attended a lot of external meetings to get a handle on what is going on in the market and learning about what challenges other organisations are facing.”
The final question for Mondelez is whether its reward offering is understood and appreciated by employees, and whether it is aligned with the company’s values. “There are two parts to it: keeping it very close to the business and really understanding how people perceive the package,” says Boldyreva. “We spent a lot of time talking to the business to try to get some insights, while communicating it in the right way.”
KEY DRIVER TO THE BUSINESS
To make the Mondelez International snacking strategy, which is about providing delicious moments of joy to consumers, come alive for them.
MONDELEZ INTERNATIONAL AT A GLANCE
Mondelez International is a new food and beverage company that was established in October 2012 when Kraft Foods was demerged from its US grocery business. It has the world’s top-selling brands in biscuits (Belvita, Ritz, Oreo), chocolate (Daim, Toblerone) and sweets (Maynards), and ranks second in gum (Stride, Trident) and coffee (Kenco, Tassimo).
In the UK and Ireland, the company has been formed from Kraft Foods’ acquisition of Cadbury in 2010. Masha Boldyreva, reward lead, UK and Ireland, says: “We don’t really think about it as a merger any more. We look at the fantastic portfolio of brands that we have. Each one has its own history. Cadbury is very embedded in UK history, with Richard Cadbury setting it up. Kraft Foods has lots of similar historical origins. Lu, for example, has a particular history in France. Whatever our name is, we have retained all of the fantastic brands.”
The global net revenue for Mondelez’s brands in 2011 was $36 billion (£22.7 billion). It operates in more than 80 countries and has 100,000 employees. It has 7,000 staff in the UK and Ireland.
CAREER HISTORY
Masha Boldyreva, reward lead, UK and Ireland, at Mondelez International, moved into reward from recruitment in 1997 when she was an HR graduate at Eastern Electricity.
She enjoyed the challenges of HR and took up an international mobility role for the utilities firm, then moved to similar posts at Credit Suisse and Cadbury. “There was something about the company that felt right during the interview,” she says. “I wasn’t a big chocolate eater, but just coming in and hearing people talk passionately about the brands really sold it to me.”
Boldyreva’s first role at Cadbury, in 2003, was managing international mobility for Europe, Middle East and Africa (EMEA). A few years later, she was offered the job of head of reward for Europe, which would have meant moving her family to Geneva.
“It was very exciting and would have involved setting up benefits and relocating people, but also getting into broader reward,” she says. “Then Kraft Foods took over Cadbury and I spent eight months undoing everything I had created. It was quite tough, but I learned a lot from it.”
In June 2011, Boldyreva became reward lead – integration, to steer the harmonisation of terms and conditions between the merged companies. She has been in her current role as reward lead, UK and Ireland, since November 2011.
CASE STUDY
Clare Prockter, PA to the company’s president
Clare Prockter, personal assistant to Mondelez’s president for UK and Ireland, has been with Kraft Foods for 21 years. “It is a great company to work for, which the longevity of my service shows,” she says.
Prockter says that after the Kraft Foods-Cadbury merger, the benefits package became much broader and tailored to each employee. “As the two companies were merged, the organisation really thought about employees,” she says. “It introduced flexible working. For the first time, I was given the opportunity to work in the office three days a week and at home for two days. It depends on your job role, but that was part of my contract that I thought was amazing, especially as a PA.”
Prockter is also pleased to have access to the annual bonus, which rewards all employees based on the company’s performance and their own individual performance. “It has always been there,” she says, “but only for managers of a certain grade or above. It was not something that support staff or administration staff had received before.”
THE BENEFITS
Pension
> A range of legacy pension arrangements.
> A group personal pension (GPP) plan is available to all employees, offering matched employer contributions up to 4%.
> Auto-enrolment staging date: April 2013.
Healthcare
> Private medical insurance (PMI) available to senior staff as a single employee cover. All staff can buy PMI or upgrade to family cover through flex.
> Health cash plan available via flex.
Group risk
> Life assurance available to all staff at four-times contractual pay.
> Income protection available through flex.
> Critical illness available through flex.
Holiday
> Minimum of 27 days a year.
> A holiday purchase scheme, allowing staff to buy up to three extra days a year, is available through flex.
Company cars
> Job-need cars available for sales staff.
> Company cars or a cash allowance available for certain senior staff.
Family-friendly policies
> Flexible working available at all sites. Also available through flex
> Employee discounts, childcare vouchers, bikes for work, travel insurance, motor breakdown insurance, payroll giving.
Onsite benefits
> Subsidised canteen and product shop at the head office in Uxbridge.
> Desk drops for all new products.
Annual bonus
> An annual bonus, based on company and individual performance, available to all employees.
Share scheme
> Senior employees receive annual equity grants, which are split into restricted stock and share options.
