There’s no doubt that salary and reward benchmarking is an essential component of any business strategy. In today’s competitive candidate market, and with salaries on the rise, no one wants to lose their best employees to better offers and packages from their competitors. Crucial to any talent retention strategy, it aims to understand what other companies are paying for similar roles to ensure that businesses can ensure that they are offering a fair wage to their employees. In a nutshell, the concept aims to compare what pay and benefits are provided by your competitors. It also allows a business to see how competitive they are within their marketplace.
In this post, we will look at the benefits of salary and reward benchmarking and why it is important for growing businesses.
An Essential Part of Managing a Business
Suppose an employer wants to keep their best-performing employees. In that case, they must benchmark and offer a fair salary to reduce the risks of their employees looking elsewhere and leaving for more favourable packages. Losing employees can significantly impact a company’s progress and performance, so, for a growing business, salary benchmarking is an excellent way to keep your company executives informed of current salary and benefits trends in the marketplace.
Some other advantages of salary and reward benchmarking:
- Identifies the strengths and weaknesses of an organisation’s salary structure, enabling businesses to create an accurate company profile and facilitating an evaluation of the status of your company.
- Saves time and money with accurate data, reducing the need to ‘create’ figures.
- Compares salary offerings to the competition, allowing salaries to be adjusted accordingly.
- Highlights performance measures and processes, helping businesses to scrutinise the pay measures of the competition.
- Helps to attract new talent, by implementing the most competitive salaries on the market.
- Allows the implementation of improvements, such as offering additional non-monetary incentives.
- Improves employee retention, reducing the risk of them seeking employment elsewhere.
- Enables equal opportunities, as an employee’s salary is determined by statistics.
Attracting the Best Talent
Salary and reward benchmarking doesn’t only prevent businesses from losing their star employees, it’s also a brilliant way of attracting the best new talent. Job seekers should be treated like valued customers – with increasing competition, the perks of the job are of paramount importance. If your salary and reward package is below par, don’t be surprised when employees flee the nest or attracting the best candidates for the job becomes a bit trickier. Today’s candidates are intelligent and know the value they can bring to a business. In addition to a competitive salary, candidates are increasingly focusing on career progression, company culture, flexible working and well-being. Consider your business a product that you are selling to a customer. With the right strategy, you can improve talent retention and attraction.
How Cogito Can Help with Salary and Reward Benchmarking
A comprehensive understanding of the competition can be costly and time-consuming for many businesses. If you’re looking to benchmark your roles, Cogito People Insights can do the hard work for you. For business leaders to create competitive and affordable salary and reward packages, we provide role-specific data and insights highlighting trends at skill, sector, geography and company level, providing you with more relevant information than generic salary survey reports.
Get in touch with Cogito People Insights today to find out how we can help you with your salary and reward benchmarking strategy to attract and retain the best talent in the market.
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