Do you know if your company’s pay is competitive in the marketplace?
Are you dealing with high turnover, or are you unable to recruit and retain top talent?
Your employees are watching the market. Can you explain to them why your compensation remains competitive?
Are you sure that you are paying people fairly and not discriminating against protected classes?
If any of these scenarios resonate with you, it might be time to regain confidence in your compensation program. Hiring a compensation consultant removes doubt, worry, and fear about your compensation program and builds a foundation for your future. Your compensation consultant will provide data-driven compensation solutions so you can make confident decisions based on facts and offers the opportunity for decision making transparency with your employees.
Because labor costs are typically the highest cost to an organization, it is essential to understand the value of each position. Benchmarking allows an organization to align pay practices with their overall total rewards philosophy. The ability to balance the needs of attracting and retaining talent with fiscal responsibility of the organization is a priority for executives. Benchmarking provides information to leaders who need to know total costs associated with salaries plus other compensation factors such as commissions or bonuses.
Benchmarking is the process of using job descriptions and matching them to established salary survey jobs to identify the external market rate for each position. Establishing market rates for positions within an organization is vital for a variety of reasons. It guides pay decision-making, which includes hiring, promotions, salary adjustments, and general compensation budget planning.
It is essential to use reputable salary surveys to complete the benchmarking process. Published surveys where the company submits their compensation information to a third party who has rigorous data standards result in more accurate results. It is vital to have current job descriptions and to identify salary surveys that include similar jobs in comparable industries, similarly sized companies, and locations.
9 Steps to an Effective Benchmarking Project
Our approach to benchmarking projects is simple, practical, and effective. The typical process includes the following steps:
Determine your organizational goals and compensation philosophy
Gather your organizational data
Identify the relevant market and surveys that will be used
Match the jobs to surveys
Verify the job matches to ensure accuracy
Analyze the market data and develop salary ranges
Prepare the final benchmark report
Review the final report with the project sponsor
Communication of results to the organization
Project Deliverables and Outcomes
Once the project is complete, you will have:
A comprehensive project report containing fresh market pay rates for your positions
Pay structures that align with the market analysis
Tools to assist with evaluating your employee pay rates
A clear, transparent plan to communicate to your managers and employees
A foundation to help you make decisions across your organization
A common vernacular for everyone to use when discussing your compensation plan
Every year you should refresh your benchmarking so you can continue to attract and retain high impact team members.
How can we help?
We are committed to creating competitive compensation programs customized and aligned to our clients’ needs, goals, and philosophy. We can provide you with a comprehensive assessment and recommendations for plan changes that support your strategic goals.