The market for data, tools, and technology and the compensation profession are evolving. The technology market and the number of professional compensation roles are forecast to grow in the years ahead. To truly understand this growing market, Salary.com partnered with Lighthouse Research & Advisory to conduct a first-of-its-kind study to understand differences in pay practices and approaches between high- and low-performing companies. The report, Compensation Technology Buyer's Guide & Provider Landscape is intended to help compensation professionals and HR leaders evaluate the technology in the market as well as what to consider when making a buying decision.
Compensation is on the minds of employers, candidates, and employees — but why now? For one, it plays a major role in a company’s success.
“Compensation management systems like CompAnalyst from Salary.com are giving companies the data, tools, and resources to drive business growth, help employers hire the right talent, and retain the best people for future success,” said Ben Eubanks, Principal Analyst at Lighthouse Research.
Because compensation is more important than ever, compensation professionals and HR leaders need to be making decisions based on comprehensive, accurate data, and using tools and technologies that scale their capabilities and improve their speed and accuracy. Spreadsheets will no longer cut it for organizations that want to get ahead.
In fact, the study showed that low performers were 50% more likely to be using spreadsheets or nothing at all to manage their compensation function. Conversely, high performers in this study were 32% more likely to have a dedicated compensation technology in place.
While this doesn’t imply that having a system causes the firm to be a high performer, it correlates with the fact that high performers use more data sources and take a more intentional approach to compensation technology selection. This implies that high performers are more strategic based on this distinct mix of behaviors and decisions.
High-performing companies not only look at technology selection as a team effort, but they build more diverse teams than the average firm. Having this broad mix of individuals, perspectives, and values on the team helps to ensure that the system and its impact on the business isn’t relegated solely to the compensation team. This may be why high performers are more satisfied with their technology on average (7.5 satisfaction versus 6.8 for low performers), especially when combined with the fact that these firms are more likely to hold off on their purchase until they find the one that matches their needs the best, not just because budget prohibits them from doing so. Meanwhile, low performers are about 30% more likely to say budget is a barrier.
Hiring managers, executive leaders, and other stakeholders need the insights compensation teams create, and high performers make sure those stakeholders are involved in the decision-making process for technology selection.
To learn more about why compensation is an urgent issue right now and how top-performing organizations are using technology to stay ahead of it, download the report.