In business, as in life, trying to rely on luck sets one up for a major loss. A person could just decide to not work and wait to win the lottery, though according to the odds they’ll be waiting forever for a ship which was never headed into harbor in the first place. And if you’re starting your own business and go to the bank for a loan to get you on your way, telling them your plan is to wait for lady luck to smile on you will likely get you laughed all the way back out the front door. In order to get off of the ground you need a plan. A concrete strategy which lays out how you’re going to make your business succeed.
Compensation planning also requires strategy. You can’t just administer compensation willy-nilly and hope you’re getting the right mix to motivate and retain employees while simultaneously growing your business. You need to look at what you’re doing, study the data, and figure out what’s working and what isn’t. And from there, you need to tweak your compensation mix based on what you’ve discovered.
In order to plan effectively, you need the right tools. A long haul trucker doesn’t steer his rig down the nearest highway, hoping that the winds of fate will somehow guide him to his destination. He has a route, maps, a timetable and a plan of how long it will take him to get to where he’s going. Compensation planning also requires the right tools. Using spreadsheet software to track data and trends may work for a while, but as your organization grows it may make spreadsheet software cumbersome and unwieldy, obscuring the end goal more than it illuminates.
A custom built compensation tool can help immensely. Intelligently designed with your organization’s structure and goals in mind, it can help you update, organize, study, and plan effectively. It can give you easier and more useful access to compensation data, which is the most powerful tool of all when it comes to compensation planning.
If you wait around hoping to get lucky with your compensation mix, odds are you’ll be waiting forever. Success requires hard work, dedication, and most importantly a solid plan. Success in compensation planning is no different. And in order to achieve success, you need to have the right tools in place. If compensation planning is getting too stressful or complicated and your organization is outgrowing the methods you have in place, it may be time to look into a robust compensation tool.