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Creating a compensation program from scratch

Five ingredients to success

Total Rewards

March 15, 2019

How do you create a compensation program in today’s dynamic work environment? This article, originally published in Workspan magazine, details five ingredients to success: Purpose, People, Value, Pay Transparency and Communication.

It’s the opportunity of a lifetime – well at least in the career of a compensation professional. Your organization is transforming its mission, vision and strategy, and you are asked to create a compensation program that will support the enterprise’s new direction.

Rewards are where business performance and individual performance meet, and you have the chance to shape the future direction of both. It’s a complex task in today’s rapidly evolving and highly dynamic work environment. But fear not: To help you navigate this complexity, we’ve compiled five ingredients to help cook up a compensation program that supports your organization’s unique purpose and workforce – for now and for years to come.

Recipe for success: The five ingredients

Tackling some fundamental questions before diving into the typical data-driven or market driven tasks you’re accustomed to will help ensure a more sustainable program aligned to your organization’s purpose and its employees.

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Purpose: What’s our Why?

Business purpose should be at the heart of compensation program design, but corporate social responsibility is increasingly important. Are both reflected in your pay programs?

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People: Who is the design for?

Understand what the talent of the future will be asked to do, including how their work will be organized, the role of critical skills and the need for continuous change. Recognize that jobs in the traditional sense might not exist.

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Value: How do you listen to design what is valued?

Leverage design thinking, listening tools and strategies to optimize your spend and create the right programs that employees value.

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Transparency: What will it take to be Glassdoor ready?

Assume that employees will actually speak to each other about their pay and ensure all programs are transparency-ready.

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Communication: Are the message and experience consistent?

Link it all together and make it easy for employees to consume your programs. What’s the employee compensation experience?

This article was originally published by WORKSPAN, March 2019.
All Rights Reserved, Reprinted With Permission

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