Compensation Planning Software

Be Confident

IN YOUR

Comp

Best Practices for Motivating and
Compensating your Workforce

Compright

Leading Compensation Planning Software

M O N D AY, SEPT EM BER 0 7, 20 20

Best-in-Breed vs. All-in- 2. Pay isn’t just HR’s priority.
One While HR teams might sign off on pay
decisions, they’re hardly the only ones
Why Compensation Management Deserves Its involved. Managers, your finance team,
Own Tool and even the board might have a say
depending on your organizational culture
HR can feel like an “all-in-one” job. Benefits, payroll, performance, or the role in question. Rather than rely on
engagement, and compensation are just a few of the items weighing on HR to pull reports or make changes, these
your mind. stakeholders can securely review pay
information (and only the information they
Naturally, teams turn to technology to help lighten the load. Today, need) using employee compensation
there are products for each HR focus area — and some that purport to software.
do it all.
Being in HR, your time already comes at a
We get it. When you’re strapped for time and resources, the last thing premium. Empower managers to model
you want is to implement another system. But while some functions their reports’ merit increases, bonuses,
lend themselves to consolidation, compensation management doesn’t. and equity grants on their own using a
We’ll go through the reasons why this critical part of your role deserves robust modeling engine. While you can set
a dedicated tool. rules and maximums on the back-end that
serve as guardrails, managers can model a
1.Flexibility is king. variety of total rewards options without
Pay is personal. Every company has their own philosophy and approach HR intervention.
to how compensation should work. For example, some link their pay
decisions closely to performance reviews. Others tailor their approach 3. Dedicated solutions have better
to compensation by department, business unit, or office location. reporting.
Compensation decisions aren’t something
At the end of the day, there isn’t a one-size-fits-all approach to to be made on a whim. Annual pay
compensation strategy. Most all-in-one HR software vendors, already adjustments, merit increases, and bonuses
spread thin across payroll, benefits, and HR administration, just don’t all impact your retention numbers,
have the versatility to meet most company’s compensation needs. In the engagement scores, and company budgets.
“best” cases, HR teams might find awkward workarounds involving In other words, pay decisions are high-
spreadsheets or other manual processes. In the worst cases, they submit stakes decisions. Before making the call,
to the limits of their HR system — effectively letting the software dictate you’ll want the right data at your
their compensation strategy, not the other way around. fingertips.

One more thing: Having all this data in one
place doesn’t just benefit HR teams and
managers. It also makes it easier to
generate total rewards statements for your
team. These summarize all the forms of
compensation your employees receive,
from base pay to their 401(k) match.
Annual total rewards statements are an
effective retention tool and help
demonstrate your value as an employer.

“All-in-one” doesn’t

work for global

compensation.

M O N D AY, AUGUST 25, 20 20

How to Make ‘Pay-for- 2. Offer bonuses, equity, and other
rewards.
Performance’ Work for
While raises can be used to recognize
Your Employees employees’ hard work, they’re often set
with the future in mind. As part of the
We all want to be recognized for our work. And while we appreciate arrangement, a promoted employee might
perks like flexibility, wellness programs, and paid time off, also be taking on additional
Compensation is the primary driver for employee satisfaction and responsibilities or transitioning into
performance. Cash is still king. management.

But for decades, HR teams and management experts have debated The problem with only tying base
whether performance and pay should be linked. There’s ample evidence compensation to performance is that it
that pay-for-performance does have a positive impact on retention, requires employees to follow a textbook
productivity, and morale — but concerns about bias during reviews have career track. Outstanding individual
turned teams away from unanimously embracing the model. contributors don’t always make great
CompensationCloud believes that budget, market rate, compliance, and managers — and vice versa. In time, your
yes, performance, are just some of the 10 factors that should be weighed top performers will hit a pay ceiling
when considering pay. Here’s how to make pay-for-performance work where neither job level, market rate, nor
for everyone. performance can justify a substantial
enough pay raise to retain them. That’s
1. Be clear about your compensation philosophy. where bonuses and other rewards come
You can’t reap the benefits of pay-for-performance if employees don’t in.
understand your compensation strategy. From the onset, be clear about
how and when your company makes its compensation decisions. Are 3. Run performance calibration meetings.
merit increases issued once a year or on a rolling basis? What kinds of
bonuses are employees eligible for, and how are they earned? What The more performance reviews factor
measures are you taking to ensure pay decisions are fair, equitable, and into compensation, the more diligent HR
competitive with the market? Be clear about how employee pay is teams need to be about their accuracy.
decided, and to what extent you consider each of the below factors: Unconscious bias, favoritism, or just
manager inexperience can all skew your
ratings — which in turn can lead to
inequities or legal red flags. That’s where
calibration comes into play.

When it comes to
managing HR data,
manual entry invites
mistakes. And if
there’s one area where
you want to avoid
those, it’s employee
Compensation.

W E D N E S D S Y , JU N E 2 4 , 2 0 2 0

4 Ways Technology Can 3. Check disparities across your total
Help Mitigate Pay Bias rewards.

1. Identify disparities on an ongoing basis. Compensation is about more than just
salary. Stock options, bonuses, and 401(k)
Companies have known about the gender and ethnicity pay gap for matching are just some of the means
decades, turning to expensive third-party consulting firms to remedy employers turn to attract and retain
the problem. While these (often costly) firms might be able to identify talent. Unfortunately, disparities exist
discrepancies at a moment in time, they do little to empower HR teams here as well.
and to do so on an ongoing basis.
4. Use budget modeling before the job
2. Add structure to your compensation strategy. offer.

Today’s managers have access to tools that make it easier to lead, While pay disparities can worsen over
manage projects, and collaborate with their direct reports. But while time through mishandled raises,
technology has made them more effective in some respects, bonuses, and promotions, they often date
compensation decisions are still handled loosely. According to the back to the original hiring decision. A
Society for Human Resources Management (SHRM), almost 15%of 2019 report found that women in Silicon
managers receive zero guidance on how to handle raises or promotions. Valley receive job offers lower than their
Another 44% are given some guidance by their HR teams but are male counterparts over 60% of the time.
otherwise allowed to deviate from it. What’s more, the same study found that
women were also less likely to negotiate
and receive a higher offer during the
recruiting process. Budget modeling
empowers recruiters and hiring
managers to identify pay inequality risks
even before the offer letter gets sent out.

Some decisions shouldn’t be left
to intuition alone. Unchecked,
unconscious bias and pre-existing pay
disparities can worsen your company’s
pay gap over time.

By giving HR teams and

managers a clear view of

their budgets,

Compright makes it

easier to make informed,

data-driven decisions

about pay.

Comprehensive

COMPENSATION

Software

Compright

Compright is leading the reinvention of employee compensation management. This
innovative software offers high flexibility using modern design that users will find easy
to learn with its drag and drop functionality. You have the flexibility to create and adjust
your compensation rules, equations, and alerts to fit company needs. It also Provides an
automated cloud-based platform that measures ten factors in compensation planning.
Compright platform combines machine learning with a robust set of tools to
streamline and simplify your compensation strategy.

www.compright.com

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