One Big Reason Why HRMS Compensation Management is Essential
For all the talk of recovering job markets, it sometimes seems that the promised prosperity is forever just around the corner. Certainly, in the context of the recession-driven restructurings, cost cuttings and headcount reductions, employee loyalty remains at an all-time low. This ongoing fallout from the global financial crisis leads to a crisis of a different kind – one of retention and engagement. More and more, employees are seriously considering leaving their current jobs and the main reason for staying is only the difficulty of finding another position.
No company can afford to rely on a depressed job market to keep people in post. The question becomes how to motivate and engage the talent you have when you can’t afford to pay impressive salary increase year on year? The answer lies in the other compensation elements in your total reward strategy: the bonuses, the vouchers, the perks, the non-cash rewards such as training and career advancement, and so on. The ideal way to manage this increasingly complex world, and boost employee engagement, is through HRMS compensation management.
But of course, for HRMS compensation “management” to translate into increased engagement and retention, there are a couple of things to take into account…
Demonstrating the Value of HRMS Compensation Management
First of all, there’s the old chestnut of data security. These days, there’s a good chance your HRMS is in the cloud and HRMS compensation data contains personal employee details, including payroll information. So, not only do the usual cloud issues apply – know where your data is, check the security and disaster recovery strategies of your provider and the data center they use, etc. – but you also need to communicate this reassurance to your people. It’s not enough to keep their data safe, they have to believe it is safe.
No company can afford to rely on a depressed job market to keep people in post. The question becomes how to motivate and engage the talent you have when you can’t afford to pay impressive salary increase year on year?
In a sense, it’s possible to boil engagement down to two factors: feeling that work has a purpose and feeling appropriately rewarded for that work. The problem is, there is still a prevalent view that reward is the hard cash that appears in an employee’s bank account at the end of the week or month. Other benefits and forms of compensation are appreciated and even desired but they don’t automatically have a cash value attached to them. By providing HRMS self-service options (as simple as mobile anytime access to a total reward statement) you can help your people understand the total value of what they receive AND see it in a new light that increases their sense of being appreciated. And that is engagement gold dust.
Finally, there is integration to consider. Some of your HRMS compensation management will be performance-based and rewarding top performers is a proven method of engaging and retaining talent. To really maximize the value of the data in your HRMS, the ideal is to integrate compensation management with performance management. When your system can identify employee performance across job families, job levels, business units, geographical locations, it can better determine where to spend your limited compensation budget... and flag up those performance-related opportunities in order to motivate employees.
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