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Organizations may be global, but people are local. That's why launching a new operation in a new country—whether it's a localized product, service or restaurant franchise—requires the right mixture of speed, efficiency and understanding of what's important to specific GEOs.
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Getting started in Comp can feel overwhelming, but it doesn’t have to be.
We all want to compare our workforce to market. But how do you outline your workforce and define which market you’re competing in? This webinar will walk you through the basic concepts of compensation and explain how they relate to your real-world challenges. You’ll learn more about the choices that you can make to evaluate your workforce.
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Strategic Workforce Planning: The Key to Organisational SuccessThe HR Observer
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6. Five
1) Understand Your Labor Market
Compensation
2) Understand Your Jobs
Best Practices
3) Create a Competitive Strategy
4) Build a Structure
5) Pay for Performance
11. Understanding Your Jobs
• Work Gets More Specialized
• Hot Skills in Canada
• Not All Jobs Are Created Equal
• Hot Jobs in Canada
12.
13.
14. Hot Skills in Canada
Tech
Other
Ruby on Rails
Suretrak (Primavera)
Software Development Lifecycle
Cloud Computing
Python
Mobile Computing
O&G/Engineering
Interaction Design
Well Production Engineering
Six Sigma Green Belt
SCADA
Oil and Gas Formation Evaluation
Chemical Process Engineering
Shielded Metal Arc Welding (SMAW)
Mergers and Acquisitions
Avionics
Financial Modeling
Material Science
Loan Underwriting
SAP Enterprise Resource
Planning
20. Competitive Strategy
• Who is your market?
• How competitive do you want to be?
• What do you want to reward?
21. Why Have a Comp Strategy?
We asked thousands of HR and business leaders*
about their top challenges in compensation. They said:
1. Retain. They don’t want to risk losing employees by underpaying
them, or losing money by overpaying them
2. Attract. To compete for talent, job offers must match the market
and the unique factors driving pay for their jobs.
3. Motivate. Drive performance with strategies that reward top
performers while aligning with company goals.
4. Confidence. Having the science to back up decisions and
conversations with executives and employees.
*http://www.payscale.com/hr/compensation-practices-survey
22. Competitive Strategy
Not all
individuals, process, functions and
business units have the same
impact on results
We need to prioritize jobs, key
employees and business units and
then allocate the greatest portion
of its resources to those high
priority areas.
23. Competitive Strategy
• Talk with senior leadership
• Vary strategy by department
• Base your decisions on key roles
25. Advantages of Pay Structures
Provide alignment to business strategy
Clarify relative worth of the position internally & externally
Ensure fair pay (legally defensible)
Define a pay range for a position
Create clear career paths
Room to reward your employees based on
performance, tenure, etc.
26. Build a Structure
• Let the structure guide your business forward
• Keep it current
• Decide what’s important for you
28. Performance
Top people concerns among senior business
executives are:
o Creating a high-performance culture
o Leadership development
o Talent Management
o Training
29. Market
Trend:
Ongoing
Shift Toward
P4P
When crafting next years budget vs. this year the use of
Across the board increases down by 50%
Use of Variable Pay has increased 300%
Source: Hewitt Survey – U.S. Salary Increases 2009/2010 and Impact on Org Spend for 2010
32. Immediate Action
Elementary
•
Know your jobs
•
Have an understanding of the market
Intermediate
•
Discuss a compensation strategy with leadership
•
Know what you want to reward and what you value
•
Build guidelines that reflect a compensation strategy that works for your business
Advanced
•
Find new and creative ways to incorporate performance pay
•
Know how your pay practices stack up against your exact competition for talent
•
Communicate you pay strategy with management
•
Develop a strong compensation structure
36. PayScale Delivers Where Other Compensation Providers Fall Short
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Finn Andersen
Sales Manager
PayScale, Inc.
Karaka Leslie
Partnership Manager
PayScale, Inc.
www.payscale.com
Editor's Notes
Intro with a little bio on each of usHousekeepingWe will send out the slidesYou are all on mutePlease type in Q&APollsThis is approved for 1 CPD hour toward CHRP recertificationSurvey at the end-helps us understand what interests you most. We are sharing a lot of information with you and if we can provide you with any specific information to your organization, we’d love to
Karaka-PayScale is the sponsor of today’s webinar todayCreator of the largest database of individual compensation profiles in the world, PayScale, Inc. provides an immediate and precise snapshot of current market salaries to employees and employers through its online tools and software. PayScale’s products are powered by innovative search and query algorithms that dynamically acquire, analyze and aggregate compensation information for millions of individuals in real time. Publisher of the quarterly PayScale IndexTM, PayScale's subscription software products for employers include PayScale MarketRateTMand PayScale InsightTM. Among PayScale's 2,500 corporate customers are organizations small and large across industries including Mozilla, Tully’s Coffee, Clemson University and the United States Postal Service.
Karaka
KarakaPublished annually. Comes out in MarchHad over 550 respondents particular for Canada and 4,000 total. Across the nation. Talking about macro trends here. 65% expectied performance to improve30% expected performance to stay the sameOnly 5% expected performance to weakenGreat news, domino effect. Organizations expect performance to improve which means we see more hiring
KarakaGreat news, domino effect. Organizations expect performance to improve which means we see more hiring and giving raises. 85% of Canadian respondents gave a pay increase in 2012.Companies plan to continue expanding in This year.• Over 50% of organizations expect to increase in size in 2013. In last year’s survey, only 38% saidthey expected their workforce to increase in 2012.Only 5% of small companies, 9% of medium companies and 14% of large companies expect their organization to decrease57% say they will give raises to at leasthalf of their workforce. Huge number. So long wage freezes. If you are in that boat, we want to give you some tips and best practices for how to align your comp strategy and make smart decisions. POLL #1 Have you already given out increases this year?
FinnWeave in trends in these areas as we go through
Finn
Finn-understanding your labor markets where you compete for talent-determining your strategy for how to align yourself to the marketExamples specific to Canada. Alberta, Oil & Gas…SaskatchewanAnother one…. Vancouver…software development
Finn-Understand who you are competing for talent withThis will not be the same for all jobsUnderstand what different industries/locations around CA/and companies valueA lot of assumptions that don’t always applyKaraka: In looking at our database, These are the Industries (North American Industrial Classification) that have experienced the highest relative median pay growth in Canada over the past two years.Mining, Quarrying, and Oil and Gas Extraction15.52%Utilities8.87%Agriculture, Forestry, Fishing and Hunting6.28%
KarakaWe are now going to transition into talking about understanding your job. Though, we will be discussing labor markets later as well when we dive into strategy.
Karaka
KarakaNot a surprise to you in HR but it might seem like many managers in your organization think it should be easy to find the people you need. In fact, in the Best Practices Report, 55% of you believe that there is a lack of qualified applicants for your open positions. Lots of talk about the skills gap. Demand for talent is high, especially for highly skilled roles.This is taken from The Conference Board’s Advisory Meeting on Innovation and Competitiveness. Work gets more specialized…starting to see routine and manual tasks decrease and abstract tasks increase. This makes jobs more difficult to price and to understand their value in the market and to an organization. “Just as people in the early days of industrialization saw single jobs (such as a pin maker’s) transformed into many jobs (Adam Smith observed 18 separate steps in a pin factory), we will now see knowledge-worker jobs—salesperson, secretary, engineer—atomize into complex networks of people all over the world performing highly specialized tasks. Even job titles of recent vintage will soon strike us as quaint. “Software developer,” for example, already obscures the reality that often in a software project, different specialists are responsible for design, coding, and testing. And that is the simplest scenario.” The Big Idea: The Age of Hyperspecialization, Harvard Business Review, July 2011
Karaka--know the job and the market for those jobs --know what drives pay and what doesn’t-Skills, experience, certifications do matter for certain positionsPurple Squirrel plug
Karaka-we asked our team of data scientists to look at our database for skills that are in demand and are causing pay to increase.These are the skills that tend to cause median pay to increase the most in Canada.For those of you that are hiring for positions right now, any of the skills on this list ring a bell? If these skills are in such high demand for your positions, once you find the right candidate with those skills, you don’t want to pass them up. Understanding the value of those skills is important to make the right compensation offer.
Finn-Can’t put a finite $$ amount around skills. Must take into account other compensable factors. Some that we just mentioned, re: labor market factors and also the value that this position/employee brings to your organization.
KarakaThese are the jobs that have experienced the highest relative median pay growth in the Canada area over the past two years.These positions are Constantly changing These are the type of positions that can significantly impact the business. What if finding that particular developer helps you develop new software that revolutionizes your business. Or, what if you find that sales manager who increases your revenue by 10% or more.Bill Gates is famous for saying that one great programmer is worth a 1,000 average programmers. These are the hot positions we are noting in our database now. From best practices report, 34% of companies responded that they have positions that have been open at their organization for six months or more!
Supply and demand for laborKarakaThe market is constantly changing. Important to stay on top of the marketChanges vary for each job
KarakaMicro at two different positions.3% doesn’t work.Luckily you don’t have deal in generalities anymore. There are data and tools out there to support you getting a solid understanding on your jobs and helping you be strategic when it comes to compensation.
Finn
FinnWhat’s most important is building our a strategy that is right for your company and right for your area*Who is our marketNumbers vary widelyNot always who “you” are—might be a start but think about where you get the people you put into your organization, and who is hiring for those same peopleWhen and where in the organization do we need to choose different labor marketsKnow your competitive market and how you want to position yourself
This is what business leaders care about. Don’t just talk about building a structure for your compensation plan. Talk about the strategy first. CRM story-Finn
Karaka
Finn*Vary the strategy by dept*Talk with Sr. Leadership – Align you compensation strategy with the overall business goals *Base this on the positions that are driving your business forward*Limited budget—need to focus on where we can let go and where we can be restricted*What challenges are you truly trying to solveKnow who you can compete with--- Are we in Alberta, anywhere near Oil Sands? Well we’re competing with Big Oil and Gas companies than. Can we match dollar for dollar? Probably not, but which positions should we try to on. You have to be differentPrioritization 12 names in the drawer
Karaka-discuss importance of structureKaraka-trends Over 74% of respondents either have or are working on a formal compensation strategy.• The likelihood of having or working on a formal compensation strategy increases with company size.54% conduct market & compensation analysis in Q4 & Q1—time is now!
FinnDon’t risk losing your top performer for internal equityKnow who you can pay less so you can afford to overpay your top employees and crucial rolesAlways keep an eye on the surging market changes.
KarakaPOLL #2 How does your organization pay for performance?
Karaka-read slide and say…Why? Because of the business need for“a relentless focus on innovation, productivity, growth and customer service.”Reasons:The main reason why most companies adjusted compensationwas “Performance-Based Pay Increases” (42%) and second was“Cost of Living Adjustments” (25%).
KarakaWhen crafting next years budget vs. this year the use of Across the board increases down by 50%Use of Variable Pay has increased 300%