Employee Compensation Plans

 

 

If you pick the right people and give them the opportunity to spread their wings and put compensation as a carrier behind it you almost don’t have to manage them. – Jack Welch

 

 

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What Is Employee Compensation

The most common objective of any employee compensation plan is to be internally equitable and externally competitive. Ed believes it is essential to not only design an employee compensation system that meets these objectives but also supports the business strategy and creates a link between work and rewards—we call this Employee Alignment.

Employee compensation systems must be monitored regularly. Be proactive in auditing your system’s effectiveness! Ed Krow can help you prevent the serious consequences that arise from employee compensation systems that are not aligned with organizational objectives.

Why Are Employee Incentive Programs Important

Incentive compensation plans can be designed for any individual or combination of individuals to form the basis for an employee’s discretionary compensation. In other words, payouts ONLY occur when specific performance or results criteria are met.

Ed believes that a solid incentive compensation system can align and focus your organization on the accomplishment of key goals and objectives. It will also reward those employees who contribute to these results.

How Ed Krow Works to Create Your Employee Compensation System

The first step is to determine the core business strategy of the organization. Are you looking to achieve Operational Excellence? Perhaps Product/Service Leadership is your key concern. Or maybe you are striving for Customer Intimacy. Writing clear objectives that support your business strategy is the key link between the strategy and the actions taken and behaviors exhibited by employees to achieve results.

Don’t spend the time and financial investment in an incentive compensation plan destined for failure! Ed can help you avoid the five most common reasons why variable pay plans fail! If you want an outside view, or simply do not have the internal staffing to manage a project of this size, give Ed a call. We can help you design the entire system or are more than willing to assist where needed. We truly enjoy seeing our clients experience the success that a well-conceived variable pay system can provide!

From there, Ed helps you develop an incentive compensation system that impacts four areas proven essential in achieving optimal organizational performance:From there, Ed helps you develop an incentive compensation system that impacts four areas proven essential in achieving optimal organizational performance:

1. Focus – we’ll clarify the important tasks/accomplishments employees must perform, and identify for them what is essential by establishing clear measures of success.

2. Alignment – we’ll emphasize the balance between organizational success and individual performance by cascading all goals down from the top of the organization to the individual employees.

3. Motivation – we’ll encourage continuous improvement by facilitating change through the use of the “pay/reward lever.”

4. Reinforcement – no program can succeed without a plan to reinforce key points. To do so, we’ll devise a positive reinforcement system that acknowledges desired behaviors and results.

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Steps to Effective Compensation Management

In a recent study, researchers found that one of the key obstacles to successfully executing a business strategy was the lack of ownership of the strategy or execution plans by key employees. Creating alignment between employees and the business strategy is a key driver of employee engagement. Employee alignment simply means employees know and believe in the business strategy. AND, they’re committed to contributing to it and know exactly what they need to do to help achieve it.

Ed Krow can help your organization achieve employee alignment through the following four-step approach:

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1. Developing & Validating Your Core Message

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2. Defining Leadership’s Role

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3. Devising an Interactive Approach

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4. Measuring Success

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Ed believes you CAN win the hearts, minds, and hands of your employees as they HELP YOU achieve business success. You can do this by using this collaborative approach to developing messages that are meaningful and consistent, educating leaders on their role in the process, continuing the reinforcement of messages through leadership actions and organizational initiatives, and measuring success. Contact us today to get started on aligning your employees with your business strategy!

What My Customers Are Saying

“An engaged culture is one of the most important things to our company. We take it very seriously and work on it intentionally. But one thing we haven’t done well is compensation.

That’s why we brought Ed in. He really got to know the culture and understood the company, and he created a comprehensive, effective compensation plan perfect for our company’s needs.

I highly recommend Ed to other business owners who want someone that gets to know the company, understands what’s important, and delivers on it.”

Bill Biesecker

CEO, HairDirect

 “Our HR officer is extremely involved with SHRM and when she saw Ed speaking at a conference and thought he would be a great fit to help us with our ongoing compensation issues.

Our company had grown from 1 location to having locations in 48 counties. At this point our compensation packages were outdated and we were looking for a change. Ed took on two projects for us; the compensation package for upper level executives and the compensation package for the upper level management team.

For both projects, he spent time re-evaluating every single position with patience even when plans changed and work needed to be redone. Through the entire process he was very responsive. When it was needed he took the time to work 1-on-1 with the team.

Ed is special because he has a lot of exposure to information. He is up to date on all HR law and when working with him you can tell that he has worked with many organizations and gained a lot of great experience. I would definitely recommend Ed to others and I would say that he’s knowledgeable, easy to work with, receptive to ideas, and flexible.”

Nan Haver

President/CEO, Service Access & Managment, Inc.

Ed’s Clients Include