After the unprecedented economic bounce-back, 2022 finished off with rising inflation and a number of layoffs across the globe. The market seems to be on the way to leveling out, as those trends continue into 2023. Year-over-year hiring rate stalls globally and more often than not, we hear of the upcoming recession.
Welcome to the compensation review season.
Like most of us, are you staying into late night hours trying to manage the merit cycle in a timely manner with your understaffed department?
Fear not. You can eliminate quite a few common problems surprisingly easily with compensation management software.
Here is my list of the 11 most dreaded ones. The 6th one will surprise you.
Short-term incentives are the most prevalent type of compensation after salary. Their popularity stems from their versatility and short performance cycles with frequent checks and adjustments, lending STI bonus to be one of the more agile-friendly incentives.
In the past, compensation management used to be rather straightforward. HR departments found new hires quite easily, employees tended to stay at a company for a while, and an annual compensation review was enough to keep both sides satisfied. But the days of 2% raises and ad hoc compensation planning are over.
The executive compensation package has an undeniable impact on companies. A well-designed executive compensation plan can positively affect the achievement of the organization's strategic goals, ultimately driving the firm's success. A bad one may result in misalignment, short-sightedness, loss of talent and profits, effectively running the business to the ground.
The difficult times are not over yet, at least for businesses. First, companies that survived the Covid-19 pandemic, lost revenue. Then the wave of massive quits informally labeled the Great Resignation has left many grappling with employee attrition. As firms struggle to find new employees for unfilled positions while keeping the remaining employees satisfied, rising inflation is now another element they need to deal with. And that’s especially difficult since the other problems did not go away.
