In this era of rapid change and heightened competition, the role of human resources has evolved from administrative support to strategic partner. Leaders now expect human resource leaders to do more than manage workforce-related processes. They expect these investments to serve as catalyst for growth and innovation, driving value across the organization while influencing a productive impact on the workforce.
But as expectations for human resource professionals continue to rise, so too do the challenges. HR leaders are increasingly demanding that these areas reduce the resource demands and time required to develop, deliver and use key talent solutions and processes. This means finding ways to streamline workflows, leverage technology and maximize efficiency without sacrificing quality or effectiveness.
In this environment, traditional measures of pay program effectiveness no longer suffice. Companies need to rethink their approach to evaluating the effectiveness of current and alternative designs to meet the evolving needs and expectations of employees.
Pay program effectiveness
- Goal-based measures focus on the extent to which the pay program achieves its predefined goals and objectives.
- Process-based measures examine how the pay programs are implemented, what activities and inputs are involved, and what challenges and opportunities exist.
- Outcome-based measures assess the immediate or short-term effects of the pay program on its participants or beneficiaries.
- Impact-based measures evaluate the long-term or lasting changes that pay programs can produce on the broader cultural, and talent strategies.
Use two key questions to evaluate needs
As with all program evaluation methods, the more complex and numerous the measures, the less effective they can be at driving change. When considering future measures of pay program effectiveness, we suggest two questions that can foster new thinking and more useful measurement.
How do you know the pay program is effective? By investing time to engage leaders, HR Business Partners, or your entire functional team, human resource leaders can identify legacy practices that no longer add value and establish key stakeholder decision criteria.
How can you show that the pay program is effective? By establishing key stakeholder decision criteria, apply the evaluation model to define measures related to process, role performance, and
customer feedback.
Ready to take action
Armed with innovative tools and strategies, HR professionals are leading the charge to reinvent the way we think about compensation and talent management. By embracing technology, data analytics, and a human-centered approach, HR is driving meaningful change that benefits both
employees and the bottom line.
As businesses continue to evolve, so too will the role of HR. By partnering with leaders to develop innovative approaches to evaluate pay program effectiveness, HR can drive growth, efficiency and success across the organization.
Contacts:
Chicago, Illinois
Partner, Human Capital Services
Grant Thornton Advisors LLC
Eric Gonzaga is a Principal and practice leader for the Human Capital Services (HCS) group in Minneapolis.
Minneapolis, Minnesota
Industries
- Construction & Real Estate
- Healthcare
- Technology, Media & Telecommunications
- Not-for-profit & Higher Education
Service Experience
- Tax Services
- Human Capital Services
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