People often think too narrowly about compensation and benefits. Many think it’s payroll. It’s way more than payroll! in fact it’s not even payroll! Payroll is the delivery of compensation and benefits, but the profession of compensation and benefits is not about the delivery of salaries and benefits that somebody else decided. The profession of compensation and benefits is the determination of what compensation and benefits, and other rewards will be given, to whom, in what quantity, in what timing, and with what linkages to performance, grade level, competence, scarcity, skills, business needs, qualification or any other valid work-related criteria.
The profession of compensation and benefits is the determination of… compensation and benefits…
I have devoted my 40-year career to the pursuit of better reward practices and I still don’t have all the answers it is a mix of business, psychology and economics within an environment of Labor laws, regulations, cultural influences and industry nuances.
To this long list of considerations, you must also factor in the size of the business, the life cycle stage of the business, whether the business is for profit or not-for-profit, the ownership of the business, and the management style of the CEO.
HR leaders and compensation and benefits specialists alike need a lot of help because they truly want to be professional and analytical as they develop better reward practices, but too often they are up against the way things have always been done, resistance to change, managers who own salary budgets and therefore believe they know how to spend those budgets wisely, And the belief that industry best practices means getting survey data and following whatever practice is most prevalent, with little regard to whether those practices make logical sense in their own situation.
I was trained by the best compensation and benefits leaders there are. And I received my WorldatWork certification in 1990 which remains the gold standard. Over $1 billion of salaries, bonuses, health insurance, retirement savings, and other compensation and benefit costs have been influenced by my work in corporate roles and as a consultant. My approach is simple: I seek for my clients better value for money. It’s that simple. When you buy a car, rent an apartment, hire a plumber or select a university, we look for the best value for the money we will spend. It’s the same for employers. Employers need talent. Whether it’s leadership, engineering, administration, office support or factory workers, employers are looking for the best talent for the money they have.
The total rewards profession today has a very sophisticated toolkit, including salaries and 100 other kinds of rewards, which together help organizations acquire, retain, develop, hold accountable, and reward people appropriately. We reward people for performance, contribution, impact, short term results, long term results, demonstration of company values, innovation, teamwork, introduction of new products, reduction of scrap material or defects, and any other objective the business may have.
This is my personal mission and the mission of my firm, Freelance Total Rewards.