Spring Clean your Comp

Mykkah Herner, MA, CCPModern Compensation Evangelist

Ryan FowlerCompensation Professional

www.payscale.com

15,000 Positions 3500 Customers 11 Countries

250 Compensable Factors54Million Salary Profiles

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Agenda

How is spring cleaning a comp thing?

Compensation plan review

Deep cleaning your comp plan

Cycling through smaller reviews

Where do you start?

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Understanding Comp through Spring Cleaning

http://kickstartyourtransition.com/blog/spring-clean-your-closet/

Just like you deep-

clean your house,

you should

thoroughly review

your compensation

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Compensation Plan Review

http://www.minteerteam.com/Blog/Spring-Cleaning-Checklist

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Compensation Philosophy

Answers the big “why” question

Should change infrequentlyReview annually

Our compensation program is designed to retain, attract, and motivate talented employees who drive the company’s success and uphold the company values. In recognition of the necessity for top-tier talent, we strive to provide base salary that exceeds the market…

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Compensation Strategy

Operationalizes the “why” with “how”

Review annuallyQuarterly for critical jobs

Talent Market(s)

Industry, Size, Location

Level of competitiveness

How aggressively to

pay

What to reward

Performance, Experience, etc

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Compensation Structure

Provides guidelines for pay

Review annuallyQuarterly for critical jobs

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Compensation Policies

Help ensure the plan is carried out

Review annuallyAs needed for key laws passed

Hiring rate: discretion is given to managers to hire from 0-33% range penetration; up to 50% requires HR approval, beyond that requires executive approval.

Promotions: increases, in the case of promotion, should be at least to the bottom of the new range, at least 7% and not to exceed 15%.

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Compensation Processes

Provide the literal steps to follow

Review annually

Process for adding or evaluating a job:1. Manager proves organizational need for the job or job change2. Manager develops job description, with appropriate compensable factors3. HR obtains market pricing and slots into structure4. HR provides manager with appropriate pay range and hiring range

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Deep cleaning your comp plan

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What does comp deep cleaning involve?

• Refresh market data

• Evaluate overall structure

• Evaluate individual jobs

• Review for internal alignment

• Decide which adjustments to accept

• Communicate

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Refresh market data

• Identify data source

• Match your jobs

• Apply strategy to datao Marketo Percentile

• Age data as necessary

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Evaluate overall structure

Do your ranges align to market overall?

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Evaluate individual jobs

Did some move faster than others?

Vs.

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Review internal alignment

Have your adjustments created issues anywhere?

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Decide which plan edits to acceptDetermine cost to adjust

For example: if we adjust our ranges up 2%, how does that impact our green outliers?

Consider: • Top performers• Hot jobs• Compression• Green outliers

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Communicate

Update and Inform Executives• market change and cost to stay competitive• recommended course of action

Train Managers• company philosophy & strategy• current market position and comp plan adjustments• communication best practices

Adjust Employees• managers share market and performance adjustments

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Cycling through smaller comp reviews

http://www.yourmodernfamily.com/room-room-cleaning-schedule/

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Compensation Calendar

Q1

Enter adjustments Total Comp

Reports

Q2

Market Study Plan Review Trainings

Q3

Budgeting Evaluations

Q4

Calculate Increases

Goal Setting

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Staggered Cycles

January

February

March

April

May

June

July

August

September

October

November

December

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Lessons from inventory (or cleaning)

Break larger tasks into smaller cycles

Review cycles

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Monthly reviews

Market study hot jobs

Market study for company segment A

Plan review for company segment B

Adjustments for company segment C

Policy review

Process review

JanuaryFebruar

y

March

April

May

JuneJuly

August

September

October

November

December

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Identify Hot Jobs…

Decide what’s hot from your business goals

Let the market decide

Goal: Develop 2 market leading

products in the next 12 months

Hot jobs: Product Managers, Product Marketers,

Software Developers

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… and decide what to do

• Market bonus

• Project incentive

• Base pay raise

• Do something creative

• Do nothing

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Where do you start?• Map out competing organizational priorities on a calendar

• Calendar out comp activities, counting back from budget deadlines

• Identify jobs needed to accomplish business goals; evaluate market pricing vs pay practices

• Evaluate all elements of your plan: Philosophy, strategy, structure, policies, processes

PayScale Delivers Where Other Compensation Providers Fall Short

PayScale leads the world in compensation knowledge with the freshest and most detailed data from over 54 million salary profiles. More than 3500 organizations use PayScale’s software and intelligence to get the greatest return on their talent. Smart businesses use PayScale Insight to recruit, retain and motivate their people.

Visit our blog: www.payscale.com/compensation-todayJoin our Group on LinkedIn: Compensation Today: HR Best Practices

Mykkah Herner, MA, CCPModern Compensation Evangelist

Ryan FowlerCompensation Professional

www.payscale.com