How compensation discussions make or kill culture

How Compensation Discussions Make or Kill Your Culture: Organizational Impact Determining compensation Communicating with executives Communicating with managers Communicating with emplo

How Compensation Discussions

Make or Kill Your Culture:

Organizational Impact Determining compensation Communicating with executives Communicating with managers Communicating with employees Your seat at the strategic table

How Compensation Discussions

Impact Your Organization

Culture

Performance Engagement Retention

Impact?

Everything you do becomes part of that story…

The story of what you value

The story of how much you are valued

The keystone

of culture

Making the Compensation Conversation a Culture Builder

Using objectives and values to

determine compensation

Compensation is about

an exchange of value,

not money.

Value Exchange

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

Employee Value Drivers

Value Exchange

Experience in industry Experience in market vertical

Experience in adjacent markets

Experience in field of discipline

Experience in adjacent disciplines

Experience with competitors

Work flexibility Work/Life balance

Meaningful work Who you work with

Challenging work Opportunity to impact Job security

Shared purpose / mission

Autonomy

Senior leadership

THE COST OF GETTING

Payroll is by far your biggest expense; the cost

of getting it wrong is tremendous.

Align compensation plan

with business goals

Communicating with

executives

Executive Audience

• Leaders don’t want to be told what to do

• Leaders can be distrustful of change

• Leaders are decision-makers

• Many leaders have access to information

• What matters to your leaders?

Execs are also Managers

Give them tools for success:

• Flight Risk report & the inverse report

• Disparate Pay report

Give them insight into what employees care about

• Am I making enough money to cover my basic needs (entry level)

• Am I being paid fairly (professional level)

• Am I being paid enough to deal with managing people (Mgrs/Dirs)

Give them talking points for comp conversations with employees

Report Relevant Info

Communicating with

managers

Agents of the Organization

• Sell the organization and the full package on the table

• Sell the benefits of the offer (initial or increase)

• Listen to the ask behind the ask

• Meet them and then move

Negotiation Skills

Listening Skills

Manager Training

Compensation Plan Overview

Putting It Into Practice

Communicating with

employees

Develop a Communication Plan

Lead The Conversation

Finding out where you stack up vs

peers can dramatically change:

• Desire to stay/leave

• Overall job satisfaction

• Exert more/less effort

I was approached by an employee who was very upset that

her base pay was being frozen After going through our

philosophy, the employees pay compared to the grade and

range she was in the employee left the meeting with a smile

on her face, feeling positive about the conversation

Monarch Landing, 300 employees

“Wow! This is what our employees need to see!

They only ever talk about what they see in their paycheck, so this would really drive home our total investment!”

Alberta Motor Association - 2,000 employees

of employees will compare pay

Anticipate Employee Questions & Concerns

Employee Pay is Low

Consider

• Should the employee pay be low?

• Is the organization able to adjust

employee pay?

Talking Points

• Start by appreciating accomplishments

• Mention market movement of the position if applicable

• Explain position in range

• Remind of last year’s adjustment amount if appropriate

• Discuss what you will or won’t do for increase or bonus depending on skillset, performance, etc.

• Open the door

Employee Given No Performance-based Increase

Consider

• What does the employee need to be eligible for the next round of increases?

• What potential does the employee have to move up in the organization?

Talking Points

• Start by appreciating contributions

• Remind of performance issues

• Explain position in range

• Discuss what you will or won’t do for increase or bonus depending on

skillset, performance, etc.

• Explain what they need to do to be eligible next go round

“I FOUND A SALARY REPORT

ON THE INTERNET”

• Conflicting information

• The “independent study”

• Position pricing vs people

pricing

• The conversation

Compensation: Your seat at the

strategic table

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