Employers not Using Compensation Effectively for Business Results

June 21, 2007 (PLANSPONSOR.com) - While most human resource professionals agreed compensation was very important to achieving certain business goals, a new survey found companies are not using compensation effectively to achieve these goals.

In a news release, Authoria Inc., a provider of talent management solutions, said its survey found respondents considered compensation “very important” to business goals including retaining key employees (66%), attracting high-quality employees (56%), and aligning individual performance with corporate objectives (49%).

However, few respondents said their companies were using compensation “very effectively” to achieve these goals – 21% for retaining key employees, 17% for attracting high-quality employees and 15% for aligning individual and corporate performance.

According to the news release, impediments keeping their organizations from using compensation more effectively cited by respondents included lack of budget, the focus of compensation managers on tactics versus strategy, HR processes that are not integrated with each other, and inadequate tools.

The survey found the specific compensation practice most used by respondents’ organizations was communicating Total Rewards statements to employees (56%). The least-used practice was aggressive pay-for-performance measures (29%).

The Authoria survey was conducted in May 2007 and compiled responses from 171 human resources executives at U.S.-based corporations. Thirty-one percent of respondents were from companies with 10,000 employees or more, and 56% were from companies with 3,000 employees or more.

More about Authoria can be found at www.authoria.com .