Compensation Consultants and Compensation Strategy
The compensation strategy design and development is too difficult to accomplish purely internally. The compensation and benefits team is usually asked for the external benchmarks and the common practice on the market and the compensation consultants can be a huge help, when the HR team is able to manage their deliverables.
The compensation consultants are expensive and HR has to have a clear goal for the compensation consultant to be achieved. The compensation consultant is always able to bring the creative and innovative compensation solution, when the goal is not given. The organization has to pay for the services, which are not utilized. With the clear goal, the compensation consultant has a clear navigation tool and forces the effort to reach the defined vision.
Compensation Consultants Benefits or Value Added
The compensation consultants bring the huge external know how in the compensation and benefits area, the previous experience and the experience with different solutions of the issues in the compensation schemes.
The compensation consultant should provide the advice on the strategic position of the compensation strategy on the pay market and to provide the information about the best practices in the compensation and benefits area. The compensation consultant should never decide about the final compensation strategy, but can provide the useful feedback and advice in the process of designing the compensation strategy.
The excellent compensation consultant always asks the clients about the feedback and how the solutions work in practice to have the experience to build on. The compensation consultant can see a new creative solution in one company, which can help to build the HR competitive advantage in another organization. The compensation consultant can help to design the state-of-the-art compensation strategy and can save huge costs to the organization in the future.
How to use Compensation Consultants
The organization should invite the external compensation consultant at the right moment. The organization cannot leave the compensation consultant to set the whole compensation strategy. The organization has to set the clear goals for the compensation consultant and it should use the deliverables of the compensation consultant in the following decision process.
Without strict goals, the organization cannot manage the compensation consultant and it cannot use the best know how of the compensation consultant. The consultant has a deep knowledge of the compensation pay market and has know how about the compensation best practices and these should be used for building the competitive advantage, but the organization has to keep the final decision about the design of the compensation strategy.
Compensation Consultants Deliverables
The organization has to define the deliverables, which support the organization in its decision process. The deliverable of the compensation consultant can be easily the content of the discussions with the executive top management as the consultant has a broad knowledge of the pay market and the top executives likes the discussions about the general market and the best pay practices in the industry.
The common deliverables of the compensation consultant are about the comparison of the proposal from Human Resources with the best practices available and the comparison with the real pay data. The consultant usually has the access to the detailed salary data and is able to make a comparison and to point out the key components and key jobs to be included in the compensation strategy as the jobs building the competitive advantage.