Create Strategic Compensation Plans to Retain Top Talent

Posted by Judy Fort on October 19, 2018

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Compensation plans can seem like a mystery to employees which can then lead to misunderstandings and unrealistic expectations. Your people power your project success. Isn’t it worth the time it takes to ensure you are able to provide the most appropriate compensation possible? 

Budgets are plans. Sometimes they aren’t perfect, but they provide a transparent framework that allows your organization to make decisions based on strategic goals. It’s really all about the impact you can have on the organization by optimizing the way you manage compensation.

Is it Time for a Change?

So many firms seem to think that only large organizations can benefit from a compensation strategy and that is just not the case. The way companies approach compensation strategy varies and may be more or less complex than other organizations. The point is, no matter how many employees you have today, it’s important to understand and define the components of your compensation strategy.

 Here are some things to consider when evaluating a compensation solution:

  • Budget overspend is a big problem: If your organization goes 4% over budget, do you know in time to compensate for the errors?
  • No alignment with overall business strategy and growth goals: Many firms find it difficult to make impactful real time decisions about compensation without the complete visibility provided by a compensation solution.
  • Compensation packages are not competitive: Given that unemployment is at a historic low, not having a competitive compensation package can factor into employee retention and turnover rates.
  • Lack of logic behind increases given by managers: It can be hard to enforce guidelines for increases. Either managers will ignore salary guidelines and “go with their gut” or “play favorites” for increases.
  • Lack of communication: Manual processes can be tedious and prone to errors, which is a headache for everyone involved.
  • Lack of visibility: Who has or hasn’t completed their compensation review? Are we sticking to budgets? With manual processes, finding this information can be next to impossible.

Consider this: What if you could eliminate errors and increase efficiency in this critical area? Imagine if your firm could be sure that it’s offering the most appropriate compensation packages possible. 

 

Compensation Automated Solution


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The Benefits of Automating Your Compensation Process

While there are many benefits associated with leveraging software to help improve compensation management, here are 5 that stand out:

  1. Gain Visibility: Transparency around compensation management can help an organization apply guidelines effectively
  2. Meet Expectations: Employee expectations around increases are difficult to manage without clear guidelines for salary increases and compensation packages
  3. Achieve Budget Compliance: A compensation solution can absolutely help your organization adhere to a compensation budget, while providing the data needed to make informed decisions about how to apply allocated funds
  4. Increase Employee Retention: Clear expectations and strategic application of the compensation budget can help to keep current employees engaged
  5. Improve Candidate Acceptance Rates: Make a positive impression on candidates and increase your offer acceptance rate by being in-tune with the talent marketplace when you make an offer

Automating Compensation Management can have a positive impact on your organization. To learn more, watch for part 2 on the topic called Compensation Planning to Stay Competitive and check out our Solution Speed Session on Compensation.

 

About the Author

Judy Fort is a member of the Deltek Solutions Engineering group and bridges the gap between technology and real world users. For a decade she has been working with diverse HR organizations helping them to achieve their goals.