In-House vs. Contracted Compensation Expertise: Key Insights from Industry Leaders

Following our recent blog post, In-House or Contracting Support: Finding the Right Compensation Expertise for Your Organization, we received incredible feedback from thought leaders in the compensation and HR space. Their insights provided real-world context and valuable perspectives on the debate between in-house and contracted compensation expertise. Here’s what they had to say, along with some key takeaways to guide your decision-making.

1. Compensation: A Year-Round Function

Jason DeMonte, Compensation Leader at Empath Health, emphasized that compensation is not a “one-and-done” process. According to Jason, maintaining an in-house team offers strategic advantages, including:

• A deeper understanding of internal goals
• Faster responsiveness to organizational needs
• Better alignment with HR initiatives

He also highlighted that an in-house team ensures consistency in compliance, fosters internal equity, and enables tailored strategies that support retention and growth. While consultants bring specialized expertise for specific projects, Jason advocated for the flexibility and control provided by an in-house team.

2. Expertise Matters: Build or Buy

Vanessa Monsequeira, VP of People at Gorilla, stressed that the decision often comes down to the existing expertise within your People team. She shared a real-world example, noting that her organization lacked internal expertise and turned to external support to successfully roll out their compensation philosophy and pay transparency initiatives.

Similarly, Ashley Case, a Total Rewards and M&A leader, noted that while in-house teams may have the capacity for day-to-day operations, they often lack deep design experience or bandwidth for large-scale projects. She pointed out that tasks like creating a brand-new compensation structure may require external help, whereas processes like implementing leveling/job architecture could be managed internally with the right time and resources.

3. Scalability and Growth Considerations

Swati Bakshi, a self-proclaimed “compensation nerd” (and a member of the People team at Roblox), outlined key factors that influence the decision between in-house and external support, including:

• Organization Size: Small companies may not require a full-time compensation team, but a fractional leader or consultant can add value during early growth phases.
• Growth Trajectory: Rapidly scaling organizations benefit from an in-house team to establish foundational elements like job architecture and pay equity.
• Investment in Tools: Early adoption of robust compensation tools can enable scaling and efficiency for small in-house teams.

4. Invest in Your In-House Team

Arif Ender, Certified Senior Compensation and Benefits Leader at Palo Alto Networks, took a straightforward stance: “In-house every time.” However, he added a crucial caveat—companies must invest in top talent for their in-house teams, offering competitive compensation and prioritizing individuals who can scale alongside the organization.

5. Balancing Perspectives

Cynthia A., Compensation Expert and Founder of Wellpay.ai, shared that an effective rewards strategy evolves with organizational goals. In her view, an in-house team that understands the company’s philosophy and has established trust with employees can adapt quickly during times of change.

On the other hand, (the legendary) Chad Atwell, a Compensation Advisor and guest CandorIQ blog contributor, highlighted a common pitfall of relying on consultants: the hand-off. While consultants may design a shiny, new compensation framework, the lack of follow-through during implementation can leave in-house teams struggling. This underscores the importance of ensuring seamless knowledge transfer and execution planning when working with external experts.

My Key Takeaways

The insights from these industry leaders illustrate that the decision between in-house and contracted compensation expertise isn’t one-size-fits-all. Here are some considerations to keep in mind:

1. Evaluate Your Current Expertise
   If your team lacks the necessary experience or bandwidth, external consultants can provide the guidance you need—especially for complex projects.
2. Align with Organizational Growth
   For rapidly growing organizations, investing in an in-house team early can lay the foundation for sustainable success.
3. Prioritize Tools and Technology
   Equipping small teams with robust compensation tools can bridge the gap between limited resources and growing demands.
4. Ensure Seamless Execution
   Whether in-house or external, success depends on the execution. Consultants should have a plan for knowledge transfer, while in-house teams must be supported with training and resources.
5. Communicate and Set Expectations
   Transparency and clear role definitions are essential, no matter the approach. Align on goals, timelines, and deliverables from the start.

The decision to build an in-house compensation team or rely on external consultants hinges on your organization’s size, growth trajectory, and specific needs. As the comments on our LinkedIn post demonstrate, there’s no universal answer—but with thoughtful planning and investment, both approaches can drive impactful results.

At the end of the day, compensation is a dynamic, year-round function that plays a critical role in attracting and retaining top talent. Whether you’re building in-house expertise or partnering with external specialists, the ultimate goal remains the same: creating a rewards strategy that aligns with your organization’s goals and supports your employees’ success.

So, are you Team In-House or Team Consultant?