The PayScale 2015 Compensation Best Practices report indicated that in most companies, CEOs still call all the shots. In fact, 53% of the organizations we polled said that the CEO is responsible for setting the compensation budget and setting compensation structures, while only 49% of HR Directors are getting the chance to take charge of the compensation structure.
(Source: PayScale 2015 Compensation Best Practices Report)
How can HR across all sizes and types of companies get an equal say in what happens with compensation practices?
For many human resource professionals, the struggle to be taken seriously is an all-to-common occurrence. Many feel that they are only relied upon to deal with employee matters that relate to daily operations, but they don’t have much of a say in terms of the business bottom line. It’s time for HR to step up and take their rightful place next to the decision-makers of every organization, and stop complaining about this issue.
How can they do this? By being strategic and having the real-time compensation data to back them up. HR pros need to think like the CEOs and CFOs of their companies, shifting the paradigm that has pervaded the human resource mindset for far too long.
3 Tips for Getting that All-Important Seat at the Table
1. Work at a medium size company. As mentioned previously, our data indicates that presently 65% of HR leaders set the compensation structure at medium sized companies, as opposed to 36% at small companies and 54% at large.
2. Think outside the obvious players. If your CEO is a brick wall, it’s time to expand your horizons to other key business influencers.
3. Don’t just ask for it; earn it. In the immortal words of Sue Meisinger, former president and CEO of SHRM, “HR is not entitled to a seat at the executive leadership table. It has to earn it. Just like everybody else at that table, HR has to demonstrate its value to the business.” In a powerful Q&A article last year, Meisinger said success in gaining a seat at the table depends on HR professionals expanding their expertise beyond pure human resource expertise into general business acumen. Stop just thinking in terms of employee engagement. Instead, take the topic of “employee engagement and illustrate how it impacts the key business metric a C-Suite loves: increasing revenue, reducing costs, etc.
This is the key issue affecting HR right now. Chief Data Officers, Chief Storyteller Officers, and Chief Innovation Officers are all crawling out of the wood work to join the decision-making discussion. HR needs to do the same-or always be on the outside looking in.
Want even more info on how to gain a seat at the executive table?
Don’t miss this opportunity to join our live webinar How to Communicate Comp to Executives and Managers on Thursday, July 16, 2015 at 10 am PST.
In the meantime, check out our new Ask a Comp Pro video on this topic and prepare to get inspired!