We Provide an Integrated Solution from Analysis,
Through System Set-up
to Change Management
To meet all of your challenges, we provide an integrated solution, starting with a diagnostic of your compensation practices and assessing your pay position against the external market; designing your compensation strategy and architecture and supporting its implementation; and, change management including delivering education and defining an effective communications strategy.
Each element of our solution is available as a stand-alone, based on your actual needs. We can also benchmark the design of your benefits, pension, global mobility and executive compensation programs per request depending upon the market.
Diagnosis / A Complex Picture
Facts and Figures | All too often, conversations about Comp&Ben are about feelings and impressions. We believe these conversations should be grounded in data and facts, and that evidence should be gathered from the bottom up, leaving no pay or cash compensation cost unreviewed. Lastly, the findings must be presented in the language of the business in a way that can be grasped by all leaders in the organization – not just C&B specialists.
Never Seen Before Insights | In our compensation practices analysis, we consider multiple areas including your internal equity, external competitiveness, total cash structure, distribution of pay costs and many others. We examine your actual pay practices to pinpoint areas where there are gaps or strategic misalignment against your Comp&Ben and business strategies. We view these gaps or misalignments as “inefficiencies” – areas where pay costs may be excessive, misallocated and are not delivering the expected return on investment.
Pay Cash Compensation Analysis | Through our diagnosis, we typically find “inefficiencies” of 5-10% of total pay and cash compensation costs (before any headcount reductions which might be separately identified). In many companies we work with, cash compensation costs comprise up to 50% (and in some cases more) of their total costs. The “inefficiencies” we identify can often amount up to 2.5-5.0% of EBITDA – monies that can be either saved or reinvested in your people.
Short- and long-term pay cost savings and/or reinvestment opportunities uncovered
- Risks identified with external compensation competitiveness
- Internal inequities and anomalies pinpointed
- Gaps in Pay for Performance found
- Issues with employee motivation and engagement brought to the fore
Brings facts and figures on the table, supporting evidence-based decision-making process
- Identifies areas of strategic misalignment and opportunities for improvement
- Educates and engages the leadership team in the discussion about pay cost management
- Builds a business case for targeted human capital investments
- Enhances the analytical capabilities of the human resources function
Compensation Strategy, Design and Architecture
We believe that business strategy should inform the design of an organization’s compensation programs and architecture. The design should communicate what is important to the organization and reinforce the desired employee behaviors and business outcomes.
When there is a strong link between the business and Comp&Ben strategies, it creates a sustainable platform for human capital investments and is the basis for a fair and transparent system that promotes employee motivation and engagement.
Our compensation design is based on four pillars:
- Internal Equity is the backbone of every compensation system and includes tools and processes such as job descriptions and job evaluation. Here, we also consider the relative value of particular jobs or functions to the organization.
- External Competitiveness defines your market positioning and pay policy priorities. We believe that the best way to assess your position is to use multiple data sources (salary surveys). We also advocate that formal salary ranges be set rather than taking a market-pricing approach. For us, “traditional” salary ranges facilitate a systematic approach to assigning compensation levels for groups of similarly sized jobs and enable a cohesive approach to delivering total compensation. Additionally, a range structure permits the organization to strike the right balance in pay between an internal focus and what the marketplace bears.
- Employee Motivation is where all of the components of Comp&Ben come into play (including additional pieces such as recognition programs and benefits schemes), helping to engage the employee with the organization and its mission. Here, we also consider the management of critical talent compensation.
- Pay for Performance ensures that the reward received is appropriately linked to individual, group and company short-term and long-term performance. Topics such as short-term variable pay, long-term compensation and spot awards are covered in this pillar.
- Compensation and Benefits (Total Rewards) Strategy
- Job Evaluation, Job Descriptions, Job Matrix
- External Benchmarking, Salary Ranges (including Total Cash and Total Compensation)
- Base Salary Management, Merit Round
- Variable Pay, Sales Incentive Plans, Spot Awards
- Recognition Schemes
- Benefits (schemes and delivery model), Pension
- Compensation and Benefits system that is linked to business strategy
- A management tool for effective and responsible pay and compensation management
- Transparent and motivational base pay management and incentive schemes
- Stronger pay for performance link
- Improved motivation and engagement of employees
- Compensation system that is structured and simple to communicate and explain
- Supports the business and managers in delivering the right behaviors and outcomes
Education and Communications – the key to Effective Change Management
Getting the design of your Compensation & Benefits program right is just the first half of success. We believe that the bigger half of success lies in its execution.
In our view, education and a well-thought out communications plan are critical for effective compensation & benefits program management – and all that much more important when managing a change to that program. We believe that companies must articulate their strategy, program and its elements. We also believe that leaders in the organization – not just HR or C&B specialists – own that communication and should model the expected behaviors.
The educational component increases the capabilities of your line managers (as well as HR and C&B specialists) to work with the compensation system. For your workforce, the communications component builds awareness and understanding and increases transparency and motivation by reinforcing the main principles and calibrating expectations. When done well, they together improve the everyday management of your program, its successful execution and employee appreciation.
We have designed C&B courses for HR and Line Management with a unique and practical approach that has been successfully proven on a number of public and in-house trainings around the world.
- Communication strategy and plan
- Effective communication tools for Line Managers and employees
- Change management programs for senior leaders and Line Managers
- Trainings for HR and C&B professionals as well as for Line Managers
Your company actively communicates the compensation & benefits in a transparent way
Managers understand compensation principles and use motivation tools on a daily basis
Line Managers and HR have the same understanding about the design and purpose of the compensation system, reducing the tendency for award decisions to be made in a vacuum or negotiated
Employees have the right information in the right context and understand the company’s programs
The world’s most innovative companies turn to BDA
It's Time to Do Comp&Ben Right
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Everything you wanted to know about Comp&Ben... but were afraid to ask.