Do you have a job, or do you have a career? Are you happy with what you do to earn a living? Have you thought about what else you would rather be doing to earn money to pay your bills and keep a roof over your head? I had no plans for my future as I worked my way through high school. I was as free-spirited as they come. On my 22nd birthday, I made a decision that it was time to make some changes. I started working with a career consultant to create a plan that would help me improve my life. Find out more about changing your work life to improve your overall life here on my blog.
Now that your company is growing and expanding, it's likely time to start designing a strategy to make the best use of your payroll budget. For most new businesses, payroll choices are simply about need and trying to get the most while paying the least. But for established businesses looking toward the future, a strategy is usually needed to make the most out of hiring and retention choices.
So, how can you make a pay strategy for your company?
Make Job Descriptions
Your first step in defining the value in jobs and figuring out how to properly compensate them is to make written descriptions of each job performed. Such descriptions may include a point scale on which you can rate each position based on concrete factors like skill required, responsibility level, effort required and the working conditions. Divide each factor into several levels and assign each level points. The overall points can be used to complete Step Two, grouping.
Start Grouping Jobs
Once you have evaluated all the jobs by the same factors, you can start grouping them into pay grades based on similar point levels. These pay grades will encompass a range of salaries already being paid. This range creates a salary curve for each pay grade category.
This may be the time to hire some outside help to assess your current compensation levels and your future needs. Such an assessment should include salary comparisons to the market, budget considerations and the ability to be competitive, benefit package assessments and internal pay inequalities. Many companies find it beneficial to hire an outsider to do this part of the work for a variety of reasons. Employees or owners may not have the time to focus on gathering data and making comparisons while doing other duties. In addition, you may not know where to get the information or how to assess it, so hiring a professional is the most logical way to get the right result. And it may even be best to use an objective third party consultant if there may be any tensions among executives, owners or employees.
Know Your Goals
Now that you have the information you need about your salaries and market rates, you can begin to align them with your company's personnel needs and its overall goals. Knowing what your goals are will help your compensation consultant advise you on how to spend your payroll budget. Questions about your goals may include such things as:
By following these steps, you can start creating a planned and actionable pay strategy for your entire company. The result will be a better use of your money, happier employees and better retention. To learn more, speak with a compensation consultant like those at Fox Lawson & Associates, A Division of Gallagher Benefit Services Inc.Share