With the budding demand of personnel and sturdy challenges in the business environment, organisations have had to evolve a precise system for evaluating jobs and assessing their merit. Compensation management helps establish the relative worth of a job in a systematic, and consistent manner, says Dr Sanjiv Marwah
Compensation Management is a crucial part of the management in an organisation. It contributes to the overall success of the organization in numerous ways. To be proficient, managers must be familiar with the worth of competitive pay, their human resources, and have an overview of payroll costs. It is of primary importance for an organisation to maintain pay levels that draw and preserve quality employees while recognising the need to keep hold of the apparent compensation policies and introducing the competitive benefits for employees.
Scope
With the budding demand of personnel and sturdy challenges in the business environment, organizations have to extend a precise system for evaluating jobs and assessing their merit. Compensation management helps to establish the relative worth of a job in an organisation. It also helps in analysing the basic pay for each job in accordance with the importance of the job in the organisational hierarchy. Once a basic pay is established, the rewards, incentives and profit attached worth the pay, designations and performance are also monitored respectively.
The compensation and benefits provides the managers with the compensation kit to put up a difference among employees as the high performance corporate atmosphere can be built within the association. The compensation and benefits department is directly attached to the expansion of the new compensation elements, which sustain the performance and affectivity of the association. It cooperates with the various business units and it aligns their desires into the general rules for the compensation elements, which are transparent and sensible. The compensation and benefits designs new adjustments to the compensation strategy and the compensation policy so that the organisation does not lose its competitive benefit on the job sector.
Growth
Despite a sluggish growth, compensation and benefits managers can consider themselves quite lucky, as only 2.7% are currently unemployed as per the present outlook of the job market. There are approximately 49,000 people employed as a Compensation and Benefits Managers. In addition, in the next 10 years compensation and benefits managers will be one of the fastest growing professions — a 12.0% rate of growth.
Skills
Technical skills are largely essential for a benefits management job, since one must exercise productivity software to execute calculations, recommend presentations and inscribe business credentials, as well as get hold of reporting tools and human resources information systems. One ought to illustrate attention to detail in order to precisely enter large amounts of information into company databases. Strong presentation skills are valuable for speaking to widespread groups about benefits programs, and appropriate communication is a necessity for interacting with employees, vendors and company executives.
Organisation and planning skills are mandatory for developing benefits plans and assessing current plans for immediate success. The compensation and benefits department should also keep an eye on the external job scenario and optimise the personnel expenses budget of the organisation. Another driving factor which is mandatory is the compensation strategy, that sets the apparent and simple compensation policy and defines the general regulations for the unexpected payments, additional benefit schemes applied in the organisation and introduces general other compensation policies like the relocation policy, short-term assignment policies, benefit car policies, concierge services and others.
Job Role & Opportunities
As human resources specialists, managers plan, design, implement and control the pay and benefits process for an organisation’s employees. In some organisations, it is a dual role or they are divided into two positions like compensation managers and benefits managers. Businesses depend on the expertise of these professionals in order to stay competitive when hiring employees. Compensation and benefits managers develop programmes that support a company’s competence to recruit, hire and preserve workers. Specific job roles include managing and administering compensation and benefits plans, conducting surveys and research, and designing strategic plans to support company objectives. They may coordinate and supervise staff activities too. They are usually liable for ensuring compliance with federal, State and local employment job.
Eligibility
Positions will need at least a bachelor's degree, with many preferring candidates to have a master's degree. A focus in business administration, finance, business management or any related field may appeal to employers in areas such as organizational development, business, accounting and statistics is typically beneficial. Analytical, decision-making, verbal and written communication skills are the core competencies that managers are expected to master. For some positions, professional certifications like certified compensation professional or certified benefits professional may be required.
Remuneration
Despite the present limited job growth, benefits managers can earn high salaries. The mean monthly wage for these managers is about Rs25,000-Rs30,000 in the beginning. With a few years of experience, with relevant skills an individual can earn up to Rs60,000-Rs1 lakh a month.
(The writer is director at JK Business School and VP of Centre for Education Growth and Research)