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To many, compensation is simply a process of trying to determine "market value"
by matching jobs to survey data. Sure, that's part of it. But that is the
simplest part!
Managing compensation is really management of an organization's reward system,
and we typically intend to reward people for making choices consistent with our
intentions. We reward them for joining our organization, we reward them for
staying with our organization, we reward them for coming to work everyday and
giving us their best efforts. Right?
So, here are the important questions.
- After spending considerable time and expense to recruit a
top-notch candidate, are you certain that "what" you will put on the table is
sufficient to get them to join?
- Are you reasonably confident that what you are paying will help
people decide to stay, and not go somewhere else? Conversely, are we paying too
much?
- Are you certain that you are always rewarding people for making
decisions and taking action that is consistent with the interests of the
business, or are you mistakenly rewarding otherwise?
- Are you reasonably certain that at the end of the day your people
go home feeling that they have been treated fairly by your pay practices, or do
they go home with such feelings of inequity in the pit of their stomach that
someday they are likely to leave?
- Do employees clearly understand what it is that they can or
should do to get a good performance review, a good raise, or get that bonus that
has been dangled out in front of them? Or do they feel that this is a "game of
chance" or "favorites"?
- Have you created a win/win situation wherein good performance
yields rewards to both the individual and the company?
When accountants talk compensation they think dollars and
cents. When lawyers talk compensation they think rules and regulations. Of
course, both are important. But, if you are thinking about compensation in a
manner that goes beyond these things and are really concerned about the
motivations, choices and behaviors of your employees, please call us. Our compensation consulting services include the following:
- Base pay, salary & benefit program design & administration
- Pay-for-performance and performance management
- Executive compensation programs
- Performance-based incentive plans
- Compensation planning, forecasting and budgeting
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