You tell us – “Blanket bonuses de-motivate our high performers. How do we implement a fair & transparent compensation scheme that inspires our people to greater achievements?”
Creating a successful compensation scheme requires a careful balance of practical and useable processes that are clear and understandable to all those in the loop and careful consideration for the all important human and psychological factors. Couple this with a systems solution supported by robust technology to steer and drive your process and you’re getting there.
The simple three step plan below is designed to start your creative juices flowing. In reality it is not quite as easy as 1, 2, 3 but once you have planned and implemented a compensation based performance management system you’ll wonder why you didn’t do it years ago.
3 steps to a successful compensation scheme
Start by creating a compensation plan that defines your organisation’s intentions. This must be fair and consistent and you must review it at regular intervals. It should also clearly demonstrate the compensation on offer and be tied directly to SMART (Specific, Measurable, Achievable, Realistic and Time-bound) goals.
Getting your workforce to understand and be on board with your plan is a must. If your people don’t believe in it how could it possibly work?
It is estimated that 95% of workers are unaware of their organisations objectives. If this is the case, then how can they possibly focus their efforts in the most efficient – and business beneficial – areas? A lot rests on having the right tools and goals in place to communicate across the board.
By having company-wide, team and individual performance based goals, many of which can cascade right through the organisation, people can understand what they are working towards. Ongoing visibility of this allows managers and individuals to periodically check they are on track to hit their targets.
And the really good news is that this will boost employee engagement.
So the plan and goals are aligned. The next challenge is to measure and manage performance. This must be done continuously and with discipline. You’ll need the ability to be flexible as strategic plans may change and markets shift. This means getting out of the mindset of seeing performance reviews as a tedius annual task. Little and often is the way to success.
The thinking behind this approach to performance management is founded on solid business practice and the benefits are there for the taking – just read some of our blogs to get the facts and figures.
An automated performance management solution will support and enable all of this, and more, bringing benefits from
Get in touch to see how we can help you unlock the benefits.
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