Reward Hours: How to design Rewards for a diverse Gen Z workforce

A one-size-fits-all approach to compensation doesn't work.

Isha Smith knows this all too well from her extensive experience in compensation and benefits, including her current role leading global Total Rewards at SoundCloud.

It’s become clear that Gen Z and millennial perspectives on meaningful work and compensation differ considerably from previous generations – which will shape future strategies for all companies as workforce demographics evolve.

Isha’s experience in a creative tech company whose employee bases trend younger and more diverse means she has unique insights into this challenge and opportunity.

In our May Reward Community Office Hours, Isha joined Vaso to discuss how she reflects these unique workforce dynamics in compensation strategies that drive both business results and employee engagement.

We explored:

• How Gen Z employees' priorities for work are shifting – and what that means for a Rewards strategy aligned with business needs
• Key considerations when designing total rewards structures for diverse, younger workforces
• Approaches to pay equity across diverse demographics
• How to measure the business impact of innovative Rewards strategies

Plus, there'll be plenty of time for your own questions too.

Webinar summary

If you're more of a reader than a watcher, here's a summary of the key takeaways and insights shared by Isha during the webinar.

Key takeaway 1: Authenticity trumps trying to match big tech packages

When competing for talent against tech giants, smaller companies shouldn't try to match every benefit – instead, they should lean into what makes them unique.

Isha explained how SoundCloud approaches this challenge: "Rather than saying we're going to offer everything that big tech companies do, which frankly we can't because it's not financially feasible, we've picked the things that spoke to SoundCloud."

The company cherry-picked benefits that aligned with their values and mission – like fertility and family-forming benefits that support their goal of increasing gender representation, and hybrid working that reflects their "connection-first" philosophy.

This authentic approach has yielded impressive results: SoundCloud increased average employee tenure from 1.8 years to 3.2 years in just over two years.

"Every wrong answer can be a right answer in a different organisation. I really believe in listening and trying to get feedback from as many sources and different sources as you can."

Isha Smith, Global VP of Total Rewards at SoundCloud

Key takeaway 2: Gen Z prioritises work-life balance over high salaries

The webinar poll results revealed a significant shift in priorities, with work-life balance and flexible working opportunities dominating responses, while "less concern for high salaries" received zero votes.

Isha referenced recent research from Randstad showing that for the first time in 22 years of tracking, work-life balance overtook salary as the top priority for workers worldwide – a trend accelerated by the pandemic.

At SoundCloud, this manifests in their "connection-first" hybrid working model, which encourages office attendance while recognising that not everyone needs to be in the office all the time. The company creates authentic reasons to come together, like their summer DJ breakfast sessions where SoundCloud creators perform live in offices.

Key takeaway 3: Transparency and equity require systemic approaches

Modern workforces expect transparency around compensation decisions, but this requires robust systems and clear communication strategies.

Isha shared how SoundCloud approaches this through multiple channels:

• Detailed annual pay equity reports shared company-wide, broken down by level and function
• Transparent communication about the entire compensation review process
• Regular listening sessions with diverse resource groups
• Clear connection between individual goals and company-wide objectives through their new "Talent Framework"

The company also moved away from traditional performance ratings to a more personalised system focused on goals, growth, and ongoing feedback – recognising that ratings can be discriminatory and don't serve diverse workforces well.

"I think the ability of tying those little nuggets of information into the organisation's values – I think for me is where the magic happens."

Isha Smith, Global VP of Total Rewards at SoundCloud

Key takeaway 4: Communication requires repetition and consistency

When implementing reward strategy changes, especially with younger workforces who expect transparency, communication needs to be repetitive, consistent, and multi-channel.

Isha emphasised the "rule of seven" – needing to communicate the same message at least seven times for it to truly land. At SoundCloud, they focus on:

• Connecting all initiatives back to core frameworks (like their Talent Framework)
• Coordinating messages across teams (DEI, L&D, Workplace) to reinforce consistent themes
• Leveraging a dedicated internal communications team