Through our compensation consulting and software companies, we have the privilege of working with numerous public and private organizations and businesses. Each has its own unique organizational structure, culture, purpose, goals and compensation programs. For most of our clients, the fourth quarter is filled with activities to accomplish goals for the current year and setting aside time to plan for the new fiscal year.
On a personal note, Thanksgiving has passed with a reflection of the many blessings received during the past year and it is time to bring out the Christmas decorations and determine how to make the decorations and lights unique from years past.
This is the season to evaluate and determine how to manage your employees’ compensation expectations in the coming year. The current trends based on several WorldatWork articles tell us to increase the use of variable pay programs, identify and implement strategies to retain key employees and make a sincere effort to dust off the current compensation program and make it more dynamic and impactful in driving organizational goals.
When we work with clients, we start with a focused assessment of the organization’s purpose, goals, history of performance, compensation philosophy, structure and programs, total rewards offerings, internal organizational chart and position values analysis (we’re advocates of internal job valuing) and an external market pay competitiveness assessment.
We utilize a 15 factored and weighted points system to determine the value of each benchmarked and unique position in the organization. This process helps our clients to value hybrid and specialized positions. In addition, each position is quantified and qualified with a comprehensive and consistent Position Analysis Questionnaire which produces a well-stated and compliant job description.
Since the 2008 to 2011 economic depression, our clients have positioned their organizations to accomplish more with less people which usually produces hybrid positions, layered responsibilities and less dependency on fixed compensation programs through the use of more effective variable compensation initiatives.
After all positions have been reviewed and valued internally with a proven and consistent valuing process, we turn our clients’ attention to an evaluation of internal pay equity and internal compensation programs that drive employee performance, feedback and motivations to meet and exceed established goals and objectives. We want the HR and Compensation professionals with our client organizations to think strategically and tactically while implementing and managing total rewards programs that attract and retain top performing employees and drive organizational performance.
An external pay analysis of benchmarked positions within the geographical recruitment area is accomplished after all internal assessments and analyses have been completed with compensation structures and programs. We recommend a combination market pay data analysis (or survey?) from like-type organizations, local and regional compensation and/or SHRM Chapter sponsored survey data, the DOL BLS Occupational Survey by SMSA, on-line pay data aggregators like Kenexa, PDF formatted survey data by business sector or geographical regions produced by Compdata, industry sector/associations produced market pay data and contracted surveys where we are commissioned to initiate and compile market pay survey data for our clients. Ultimately, we want our clients to know their competitive position with their respective employee/talent markets on a comprehensive internal and external pay line basis and by individual position title.
Once the internal and external compensation assessments are complete, each client is faced with expected and unexpected and/or surprising compensation program and employee pay insights. Now, let the fun begin! This is a time where pay structures are updated with tweaks if previously manicured each year or significantly modified if the hedges and trees have not been pruned or fertilized in several years. Benchmarked and unique positions are properly placed in the proposed pay structure based on their internal value and external competitiveness value.
The base salary structure is set, positions are valued and placed and employee pay is evaluated or re-evaluated within the new structure and now the organization is ready to focus on variable pay programs, bonuses and employee benefits to complete the total rewards package offerings that will attract and retain top performing employees and drive the organization’s unique competitive advantage or, for our public clients, drive services to the next level of product customer service and outcomes. HAVE A BLESSED COMPENSATION SEASON…