Five Questions to Ask About Your Compensation Strategy

Compensation strategy is both an art and a science. And yet, it is also one of the most important annual investment decisions your company will make. To make it less of a black box effort, here are five key questions to ask about your comp strategy not only at the beginning of your annual budget cycle but also throughout the year.    

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Does your job architecture need a refresh?

Since tech layoffs started in Q4 of 2022, we’ve seen a growing variance in job leveling expectations between applicants who had previously been employed by large public companies and those at start-ups. At the same time, salary expectations have leveled and in some cases started to decline.  Especially for engineering and product management positions, 2023 is a good year to re-evaluate your job architecture to accommodate a more experienced pool of applicants.  Pay transparency is also causing organizations to review job levels to ensure equal pay for equal work.

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Do you have issues with pay equity and fairness?

While it remains a best practice to close out a compensation cycle with a review of all changes to ensure they are fair and equitable, we recommend ongoing analysis to flag outliers in real-time. Ensure that you have tools in place to visualize both cash and equity discrepancies based on race, gender / gender identity, and disability status (and sexual orientation if tracked). This allows you take action to adjust your hiring, merit, and promotional practices before it becomes a bigger problem.

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Can you trust your compensation benchmarks?

There is a wealth of comp data out there, but its coverage, recency, and sample size can vary significantly depending on your industry and geography. As a result, many HR teams end up buying data from multiple sources to get a complete picture. At CandorIQ, we take a data agnostic approach where customers can import their own comp data. Or you can leverage our data set and in-house experts to evaluate benchmarks and reset your levels and bands.    

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Do your financial and HR systems play well with each other?

Too often, HRIS and ERP systems are disconnected and don’t integrate well with one another. At the same time, point solutions for recruiting, performance management, job architectures, etc. are similarly siloed. Finance teams end up pulling data into spreadsheets to do the bulk of their analysis and planning, which is inefficient and presents access control challenges. As a compensation intelligence platform, CandorIQ is designed to pull in the right data so that budgets can be based on real-time data … and executive leaders can make decisions based on real-life scenarios.  

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Can you easily share comp strategy and its impact on employees?

Finally, your comp strategy can only work to the extent that it is understood by department leaders, hiring managers, recruiters, employees, and even candidates. This difficult work is typically done via trainings, emails, and power points that are too general and not specific to the team or employee. Ask yourself if the technology you are using is up to the task of effectively communicating compensation strategy. Do you run the risk of losing candidates or employees because they don’t understand their comp?  

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Our goal is to change compensation management from a chore to a super-power for your company. Please reach out to learn more about our platform … we have a limited number of no cost pilots available now: contact@candoriq.com

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