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Webinar - Best Practices in Pay-for-Performance


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Incentivizing employees based on performance makes a ton of sense. High performing employees should get a bigger piece of the pie, while low performers may not get a raise. In fact, according to PayScale's 2017 Compensation Best Practices Report, performance was the number one reason for giving increases last year. Organizations are moving away from using COLA as a reason for across the board raises.

Join PayScale's Mykkah Herner and Chris Estes to learn how to do pay-for-performance well and why paying for performance remains a strong compensation best practice.

Register for this webinar and you'll learn about:

-The right frequency of performance reviews
-How you can recognize performance with pay
-Monetary or non-monetary and which works best?

Published in: Recruiting & HR
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Webinar - Best Practices in Pay-for-Performance

  1. 1. Best Practices in Pay-for- Performance Chris Estes, PHR, CCP Compensation Professional Mykkah Herner, MA, CCP Modern Compensation Evangelist
  2. 2. #CBPR17 54 Million Salary Profiles 250 Compensable Factors 15,000 Positions 6,000 Customers 2,300 Skills Hi, We’re PayScale!
  3. 3. #CBPR17 Chris Estes, PHR, CCP Compensation Professional Mykkah Herner, MA, CCP Modern Compensation Evangelist
  4. 4. #CBPR17 Agenda Current State of Performance Linking Performance with Pay Exploring the Full Range of Rewards Things to do right now
  5. 5. #CBPR17 Ways to Reward Performance
  6. 6. #CBPR17 Performance Was the Top Reason for Raises
  7. 7. #CBPR17 Performance Evaluation Today
  8. 8. #CBPR17 Motivate Employees 42% of millennials want feedback every week Source: Ultimate Software & the Center for Generational Kinetics • Stack ranking • Annual review cycles • Emphasis on Ratings • Encourage ownership thinking • Provide frequent feedback • Build skills
  9. 9. #CBPR17 Frequency of Reviews
  10. 10. #CBPR17 Manager Involvement 95% of managers are unhappy with the way performance reviews are conducted. 90% of HR leaders question the accuracy of information received. Source: Lillian Cunningham • Time & efficiency • Consistency • Focus on strengths; enable and coach • Clarify expectations • Build the relationship
  11. 11. #CBPR17 Drive Business Results “In today’s rapidly moving business world information given in an annual performance review is often outdated and obsolete...” Source: Impraise • Results-based • Speed of business • Project cycles • Build teams
  12. 12. #CBPR17 Measuring Results Through Acronyms “The success of companies in this day and age hinges on the ability to execute. Ideas are important, but they are easy compared to execution.” Source: BetterWorks Source: John Doerr
  13. 13. #CBPR17 Connecting Performance with Pay
  14. 14. #CBPR17 “Employees won’t believe there is a link between pay and performance unless they can see it.” Margaret O’Hanlon re: Think Consulting
  15. 15. #CBPR17 Linking Performance with Pay Culture and perks that reward high performers Higher increases for top performers Results-based incentive plan Performance-based rewards & recognition
  16. 16. #CBPR17 Incentive Pay • Bonus vs Incentive • Match incentive cycle to work cycle • Alignment: individual, team, organization • Additional structure considerations • Self-funding – variable costs • Keep it simple
  17. 17. #CBPR17 Bonuses – Tied to Performance or Not
  18. 18. #CBPR17 Variable Pay Influencers by Level
  19. 19. #CBPR17 Base Pay Base pay increases are determined by performance and position in market-based range using a Merit Matrix Exceeds Meets Does not Meet
  20. 20. #CBPR17 0% 5% 10% 15% 20% 25% 30% 35% Highest Average Budgeted 3% Increase Is it enough to differentiate?
  21. 21. #CBPR17 Exploring the Full Range of Rewards
  22. 22. #CBPR17 What’s your deal? Employees and employers are in a relationship where they agree on an exchange of value
  23. 23. #CBPR17 EqualFair A note on fairness: Fair doesn’t necessarily mean equal Differentiate* Pay by Performance Results Experience Skills Education Market *Be aware of legal restrictions
  24. 24. #CBPR17 • 40 hours of volunteer time • Annual company trip: volunteering, going somewhere tropical and relaxing • Free food: bagels, lunches, etc • Commuting allowance • Wellness: allowance per year, yoga, free on-site massage, free gym membership • Dog-friendly office • Mondays off in the summer and the 1 week extra off (with pay) over holidays • Recognition program gives employees money to award to other employees • Pet insurance • Tuition exchange program Employees’ Favorite Benefit or Perk
  25. 25. #CBPR17 Don’t underestimate the value of recognition With a positive employee experience… of employees are less likely to leave are more likely to go above and beyond who received recognition believe they had a positive employee experience Globoforce And…
  26. 26. It’s not a best practice if it’s not best for your organization
  27. 27. #CBPR17 Immediate Actions • Inquire about performance management processes • Evaluate pay practices. Are you linking performance to pay? • Evaluate your non-cash compensation. What perks motivate your employees? • Identify business cycles and talk with managers about how to create better alignment • Train your managers and employees to deliver effective feedback
  28. 28. #CBPR17 PayScale Delivers Where Other Compensation Providers Fall Short PayScale offers modern compensation software and real-time, data driven insights for employees and employers alike. More than 6,000 customers, from small businesses to Fortune 500 companies, use PayScale to power pay decisions for more than 13 million employees. Visit our blog: Join our Group on LinkedIn: Compensation Today: HR Best Practices Chris Estes, PHR, CCP Compensation Professional Mykkah Herner, MA, CCP Modern Compensation Evangelist