Compensation Strategies for Fast Growing Companies
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In a market where getting good talent for your fast growing company is difficult, compensation strategies matter! This slideshare will make it easy for you to know what's important in a compensation strategy.
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Compensation Strategies for Fast Growing Companies
- 1. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies
- 2. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Rusty Lindquist VP of HCM Thought Leadership BambooHR Mykkah Herner Modern Compensation Evangelist Payscale
- 3. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies What we’ll talk about 1. Challenges and byproducts of rapid growth 2. Comp plans can help 3. Aligning across multiple locations 4. Three options for M&As 5. Things to do today
- 4. Understanding Rapid Growth (and how it relates to comp)
- 5. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Growth Time STAGE 1 STAGE 2 STAGE 3 Market Viability Client Acquisition Business Scalability Organizational Waste (grow)(validate) (operationalize) BYPRODUCTS OF GROWTH Cultural Dilution Reduced (Intrinsic) Engagement Reduction In Transparency Strained Management Inconsistencies Create Friction
- 8. Ram Charan Best-selling Author, Business Advisor
- 9. OUR PEOPLE SYSTEMS ARE THE MOST IMPORTANT SYSTEMS IN OUR ORGANIZATIONS
- 10. Comp Plans Can Help
- 11. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Reinforce Clear Strategy
- 12. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Align Resources to Goals
- 13. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Develop Guidelines for Pay
- 14. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Enable Quicker Pace
- 15. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Ensure fairness across locations
- 16. Comp & Culture
- 17. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies
- 18. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Everything you do becomes part of that story… The story of what you value
- 19. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Compensation: The story of how much you are valued
- 20. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Making the Compensation Conversation a Culture Builder Don’t be offended Be open Take it seriously Be objective Be proactive Be Positive
- 22. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Make Sure Your Approach To Comp Tells The Right Story
- 24. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Same job in multiple locations has different titles and pay
- 25. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Different jobs in multiple locations have the same titles
- 26. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies How do you fix it?
- 27. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Target Specific Issue Areas
- 30. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Feeling appreciated, valued, and adequate rewarded for your effort. Value Total rewards Va Value Rewards Recognition Compensation What you get from work
- 31. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Comp is about an Exchange of Value Not just Money Experience in industry Experience in market vertical Experience in adjacent markets Experience in field of discipline Experience in adjacent disciplines Experience with competitors Product knowledge Competitor knowledge Time and experience in company Education Discipline training and certification Supply and demand Employer Value DriversEmployee Value Drivers Base pay Performance Pay Paid time off Benefits Travel Culture and environment Work flexibility Work/Life balance Meaningful work Who you work with Challenging work Opportunity to impact Job security Shared purpose / mission Career advancement opportunities Autonomy Senior leadership
- 32. Three Options for M&As
- 33. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Maintain separate plans
- 34. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Use one plan
- 35. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Merge plans too
- 36. bamboohr.com 1-866-387-9595 Comp Strategies for Fast Growing Companies Things to do today 1. Things to do today 2. Clarify alignment of business goals to talent strategy 3. Discover your talent markets 4. Prioritize pay decisions based on the above 5. Decide between pay ranges and pay grades 6. If merging, get to know both plans 7. Make a plan to develop a comprehensive comp plan
- 37. Thank you! Follow BambooHR on social media: bamboohr.com/blog
- 38. Follow BambooHR and PayScale on social media: bamboohr.com/blog | payscale.com/compensation-today Questions? Rusty Lindquist V P S T R A T E G I C H R I N S I G H T S B A M B O O H R @ r u s t y l i n d q u i s t r u s t y @ b a m b o o h r . c o m w w w . l i n k e d i n . c o m / i n / r u s t y l i n d q u i s t Mykkah Herner M O D E R N C O M P E V A N G E L I S T P A Y S C A L E @ m y k k a h _ h e r n e r M y k k a h H @ p a y s c a l e . c o m w w w . l i n k e d i n . c o m / i n / m y k k a h h e r n e r
Notes de l'éditeur
- Mykkah When organizations get into a high growth phase, everything starts moving faster. Recruiting speeds up. Making sure that new hires have what they need to do their jobs (computer, software, access to internal networks, etc.) on day one becomes a challenge. Compensation is another aspect that you must get right as you scale quickly. Neglecting to think about compensation planning can cost you top talent, slow down recruiting, and create internal inequities down the line. So how can you make sure you’re getting the comp equivalent of the right set-up as you grow? Join PayScale for this webinar where you’ll learn: How comp can help make hiring easier during high growth Ways to pay fairly across multiple locations 3 options for your comp plan during a merger or acquisition
- Both, Why am I qualified to talk with you now and/or why am I so excited about growth
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- PAYSCALE Let’s face it, comp is a huge part of the budget. A scalable comp plan that is well defined and communicated will not only make budgeting easier but it will attract top talent and retain valuable assets to your team.
- PAYSCALE Boat What are you trying to accomplish as an organization Where do you compete for talent How competitive do you want to be in your various functional levels What do you want to reward? Not all can be 1st – some need to be second or third.
- PAYSCALE CASH is limited. Spend it in the right places Biz Goal = 2x revenue Biz Strategy = 1 new product per year Talent Strategy = Engineer (innovators) Comp Strategy = retain / reward top engineers & incentivize to innovate
- PAYSCALE Pay Ranges – smaller number of unique job titles Pay Grades – bucketing a number of similar internal worth Where will new employees enter ranges? How will current employees move through ranges? What happens when employees are promoted?
- PAYSCALE As the organization beings to grow, the number of new jobs will be quick to follow. If you currently have job based ranges, where each individual job has it’s own range ask yourself: Is that scalable, and can we continue to replicate this strategy as we expand? If the answer is no, developing a grade structure will allow ease of administration during growth and allows adjustments for internal equity. Also, to note: -You can hire faster and feel confident with quick decisions knowing there are policies/boundaries in place -You will find it easier to communicate and drive everyone in the right direction
- PAYSCALE Align your locations to one another so you know, without taking the time to calc with each hire, how different the locations are. Bonus: you can message this to managers to they get on board with the rationale. Based on cost of labor (demand) in those locations, not cost of living. Note: Sales jobs and/or highly mobile jobs. Jobs above a certain level (either “national” or “HQ” or “highest”) More about the challenges of aligning across locations in a minute.
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- PAYSCALE Align your locations to one another so you know, without taking the time to calc with each hire, how different the locations are. Bonus: you can message this to managers to they get on board with the rationale. Based on cost of labor (demand) in those locations, not cost of living. Note: Sales jobs and/or highly mobile jobs. Jobs above a certain level (either “national” or “HQ” or “highest”) More about the challenges of aligning across locations in a minute.
- PAYSCALE Align your locations to one another so you know, without taking the time to calc with each hire, how different the locations are. Bonus: you can message this to managers to they get on board with the rationale. Based on cost of labor (demand) in those locations, not cost of living. Note: Sales jobs and/or highly mobile jobs. Jobs above a certain level (either “national” or “HQ” or “highest”) More about the challenges of aligning across locations in a minute.
- PAYSCALE Some of these challenges are especially prevalent with M&A, but we’ve also seen them in companies that just grow faster than they can keep track.
- PAYSCALE Identifying same job different title when benchmarking jobs (if the match is the same across a ton of titles, probably the same job) - priced “Machine Operator 3” in NY, PDX, and Tampa – was about $37K, $36K, and $35.5K respectively. (NY s/b 2.8% higher than PDX, Tampa s/b 1.4% lower than PDX by geo differentials)
- PAYSCALE If you think you have the same job across a bunch of locations and your managers wont agree, you probably have different jobs. In the eg above, the PDX version might be more of a Shop Laborer, NY might be a true Machinist, and Tampa might actually be a Shop Foreman, all in the Shop realm, but some have much more responsibility and market value than others.
- PAYSCALE scrap everything and decide what jobs you need. Realign all employees to the new structure. Grandfather as few as possible. Consider company culture. Can you roll it out all at once? Staggered implementation? Or do you really just have to pinpoint a few problems and make do.
- PAYSCALE If you can’t do a complete overhaul, identify the jobs that have either the biggest or the smallest disparity between highest and lowest paid employee in the job and start with those.
- PAYSCALE One of the quickest ways that people grow is through M&A. Many focus on merging business objectives, goals, company cultures, etc. Getting a handle on what you intend to do with comp early on will set you up for success
- PAYSCALE One of the quickest ways that people grow is through M&A. Many focus on merging business objectives, goals, company cultures, etc. Getting a handle on what you intend to do with comp early on will set you up for success
- PAYSCALE good – path of least resistance at the point of M&A improve: leaves room for inequities b/n groups works: if the new entities won’t interact much and are in different locations
- PAYSCALE good – fairly easy at least for some in the group, especially if one is well-established improve: may leave the other group feeling slighted works: if the rationale is communicated well
- PAYSCALE good – sets the tone that the companies both have merit improve: will take the longest time to coordinate works: if you have strong decision-makers and people who know each plan inside & out
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