Integrating benchmarking into your organization will result in valuable data that encourages discussion and sparks new ideas and practices. Undertaking salary benchmarking will give you impartial and accurate pay information to help define a fair and competitive salary for the employees of your company. Here is another blog post from our series on compensation and reward, talking about How To Motivate Your Employees Beyond Pay. Some of the factors that can affect pay rates include geographic location, experience, education level, job responsibilities, organization size and financial resources. <> Are there notable differences between cities, especially those in the same country? endobj Compensation benchmarking isn’t a dark art. 8 0 obj In terms of HR, salary benchmarking is essential for comparing the pay and benefits on offer against those offered by competitors. After completing the data collection phase of the benchmarking exercise, you’ll want to ensure all that information goes to good use. Whether you’re a seasoned VP of People/Talent or People Ops coordinator fresh into the world of startups, a company wide salary benchmarking is not something anyone looks forward to, however it doesn’t have to be this way. endobj Do compensation surveys actually tell you how much you have to pay? What is salary benchmarking? Therefore, a salary equivalent to the midpoint of a grade represents 100% compa-ratio. The results will provide you with an accurate salary range for a specific position, taking into consideration the region, industry, company size and other factors that make up the compensation package. Comparing your business performance against certain reference points – is a popular and potentially powerful way to glean insights that can lead to improved performance. More importantly does it make sense to pay differently between two cities in the same country. <> How do personal life choices fit into this? <>/F 4/A<>>> You could also go all in and pay for something like Radford, Willis Tower Watson. Similarly, it can justify any changes the market dictates. Specifically, it plays a vital role in areas such as: – Determining the proper salary and compensation packaging for to-be-filled roles; – Assessing the structure of current job classifications or levels; – Identifying and addressing internal salary equity issues; – Competing for top talent in tight labo… We recommend you pull data from the different countries you operate in and then interrogate it. A thorough analysis of the data and percentiles will inform you as to where your salaries sit in comparison to your preferred position and the levels paid by your comparator groups, however that does not mean that’s what you have to pay. <> Crucially, this is a much more focused and detailed process than a traditional salary survey. � H�Ȑ�a��N/ԯ��ѩ�r�-��#�"{���貭����h�5'G��6�? It’s also FREE (as long as you upload your data once every 6 months). Make sure you clearly document what approach you took to arrive at the final benchmark so that when you come to refresh the data in 6 /12 months time, you know what methodology to use for each role. At its best, it can be used Benchmarking gives a complete breakdown of the compensation package allowing companies to compare salary and benefits available within specific sectors and named companies. x��U]k�H}�?�G����{���u�6](dCBTWq��VW�b���^IMd�DmK�;g�s���}�l�ugg���)��w��VՏ�l���̮��v_4�j����������^��������8�>p��� Exhibit 8 describes these different types of benchmarking studies in detail. From our experience, there isn’t much difference between them. Salary benchmarking can help companies to overcome these issues. This deserves a blog post on its own which we’ll be releasing in the next few weeks. Here are some questions you need to think about: I’m not going to tackle all of these questions now but have picked a few that come up every time we carry these projects out. endobj It didn’t really tell me much about whether we were paying ‘competitively’ or not. There is no quick fix, but spending time on it now and getting it right, will pay dividends and result in something that you only need to revisit 1–2 times a year, not once or twice a week. A salary benchmarking report shows where your company sits in the market and how competitive it is. How to turn all those £0 into something that is equitable, sustainable for your business and something that people believe in. This will essentially form your progression and levelling framework on top of which you need to place your salary data for each role and level. How should you remunerate employees based on their location? So why do it? 11 0 obj But it is a very different exercise to benchmarking sickness absence, like we showed you last week . endobj Many organisations already have an annual or semiannual benchmarking process built into their hiring efforts. If the right data sources are not used you may end up carrying out an extensive benchmarking exercise which lacks credibility as the business and line managers do not trust the data. Glint Benchmarking … <>>> It’s how you avoid losing top talent to competitors who offer a much more attractive pay package. Eh, that doesn’t make sense?! the average in the market. When using process benchmarking, the data is gathered via research, surveys, and website visits. 7 0 obj Simply select a job function and industry to get a breakdown of the average salary for each level. Carried out effectively, a benchmarking exercise can lead to increased levels of performance and reduced fees for a customer's outsourcing arrangement. Over time, these annual surveys turned into benchmarking exercises. Should we even be talking about percentiles with our employees/candidates? 3 0 obj Human resources and hiring managers may consider several factors when trying to obtain accurate market salary data. Having worked with salary data from various sources, time and time again we hit the same two challenges: Take your time to figure out which is the best option for each team. A salary benchmarking exercise was conducted using publicly-available individual-level data on faculty employed in English departments in the California State University (CSU) and University of California (UC) systems. The data I’ve pulled looks wonky or doesn’t even exist for some roles. Well, I’m here to tell you that there is no silver bullet in salary benchmarking. Glint 63 . The question that all People teams dread. Coming to that time of year when you need to run your annual pay review process? ?S�&�����M���� ����/�T� ��;LV7���XJ`���]=�/��R�x��ˬ�F�t��[Ai�ʃk�q��]�B�vP__��Yx�`H� BT��H��ϯ��m��]ӟ Kc{�/�Y'�֣�R R2�u�ʅ�����ƶg���|CNqY�E���`�Ν��"ö������~#۾}{�?U�ФdƔ���A��l�P��[|�ol�����eil���v�Ep�)�!%�Q�_�"��n�S{�v�|: ���;����aܷ 0cJb�N�H�c��ol3}�U����G�#������ATسw�{��eE�ggg���ƻW��%�V7ͼ�����oQ�����^NJ?� ��b���~il����r"�>r�Ⱦ}��k��m۶gϞ������������t���C��޽���@z��������Ҏ=J鬒. That does not mean that you then have to pay in the 50th percentile! The Different Types Of Benchmarking – Examples And Easy Explanations. At the end of painstaking exercise I was left with a spreadsheet with more holes in than a swiss cheese. The tl;dr, it's neither an art or science, but a bit of both. Does it make sense? Any salary benchmarking process should engage with the business from the very start. %PDF-1.5 How do we handle different geographical locations? Fundamentally, salary benchmarking is neither an art, or a science, it’s both. By Staff Writer. May 15, 2009 The Importance of Creating a Salary Benchmarking Plan. endobj Get in touch with the People Collective if you’d like help with your next salary benchmarking exercise and learn about how we’ve helped companies like TrueLayer, Bud, Seedrs, Lingokids, CharlieHR, Second Nature and many more solve this gnarly topic. Are there enough data points? I'd love to know how other people approach this traditionally tricky exercise. In Option Impact, you can filter data based on different countries (at present there is no option to get to city level). It’s called salary benchmarking. So what is the key takeaway from this? That’s when someone said ‘why not throw some money at the problem and buy a data set from one of the big salary benchmarking companies like Radford, Willis Towers Watson, Mercer?’ I’d never even heard of these but given that’s how traditionally a lot of the larger companies carry out salary benchmarking then surely this will give us the information we need? Due to the recent pandemic, and the move to remote working practices for many, there are questions around the traditional cost of living adjustments that companies have taken in the past with global compensation models. Learn how to benchmark and set salary ranges for employees in just a few easy steps. In this competitive job market, job seekers know their worth. <> What is the competitive rate? You can be data driven but the data is only as good as you know what to do with it. I had a blank spreadsheet open and was painstakingly trying to find the junior, mid, senior and exec salaries for all the roles we had at the time from the various sources. Fill out the appropriate information for your business and your competitors in order to compare and analyze differences in the various categories. <>/F 4/A<>>> %���� Again, we recommend pulling data for the different cities you operate in and then taking a deep look at this. #salarysurvey #salarybenchmarking. endobj We work with clients on a team by team basis, looking at different filters and sources to arrive at a final recommended salary for each level. Perhaps you've never run one before or know deep down your current process isn't particularly robust. Ve pulled looks wonky or doesn ’ t really tell me much about whether we paying! Website visits turn all those £0 into something that people believe in, we covered. 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