10 things to do while planning your compensation program
The right compensation plan allows your company to retain the top talent and keep employees engaged to drive productivity. However, without the correct sense of the market rates and firms with whom you compete with the product and labor, your company cannot flourish.
Simply adding 5% to the salaries will not help. A solid compensation plan is vital to ensure you don’t push your company into pitfalls.
Here are the steps to a strong and successful compensation strategy:
- Ask yourself the following questions before you make any big changes to your compensation policy-
- What is the budget of the company?
- Is your pay externally competitive?
- Are the programs mentioned in the compensation policy legally compliant?
- Is the program equitable?
- Is your policy fiscally sensitive?
- Is it strong enough to attract and retain talent?
- Is your compensation policy competitive, or fair at the least?
- Draft an outline
- Appoint a compensation manager
- Determine how competitive you want to be with your industry’s market
- Rank jobs and prepare tiers
- Settle on the well-thought new structure of salaries
- Complete necessary policies
- Get approval from the higher management
- Develop a communication plan to inform your employees of the changes
- Implement, monitor, review, and evolve the policy