‘Acing’ a Pay Plan
How do you make money?
A company wanted to migrate from a seniority-based salary approach to market-based compensation. Commonwealth HR Consulting’s (CHRC’s) first action: interviews with top executives to understand how the company went to market, differentiated itself, and made money. We developed a clear understanding of the labor markets in which the client competed for talent. CHRC then selected compensation data from the appropriate labor markets for the correct job matches.
Know your PIQs
CHRC’s analysis revealed that some jobs did not have equivalent matches in published salary surveys. We led the client through “Position Information Questionnaires” (PIQs) to gather data on roles that were not easily defined and for which there were not clear or accurate job descriptions. With this customized approach, we established an internally equitable system anchored in market-based data.
Making the grade
CHRC applied strategic assessment, a collaborative process, and left the company with a market-based compensation plan for equitable and simpler salary administration.
- CHRC created the client’s first Grade and Range Structure
- We anchored it with benchmark roles priced in the appropriate labor markets
- Once the PIQs were reviewed and collected, we began slotting the non-benchmark roles based on internal and external equity
- We facilitated a slotting exercise in which senior executives worked together to discuss, understand, and determine the hierarchy within their company. This was a departure from their historic preference for working within silos.