Modernizing compensation management

Laleh Hassibi, PayScale

A white paper released by Ventana Research called “Modernizing Compensation Management” calls for a new approach to compensation management to ensure organizations remain competitive in today’s volatile economy. Ventana Research found that 58% of businesses expressed some level of dissatisfaction with their current compensation manage-ment solutions and half of the respondents lack confidence in their company’s overall compensation processes.

“This latest research echoes the same message we hear from customers about the need to improve compensation management by taking advantage of sophisticated technologies such as analytics and Big Data,” said PayScale’s Vice President of Marketing, Tim Low. “In today’s intense talent market, business leaders are moving away from approaching compensation as a ‘Black Art’ shrouded in mystery toward more tangible, data-driven insights to help them achieve their overall talent management goals.”

“Modernizing Compensation Management” states that human capital is a business’ most important asset and often its largest operating expense, so it can have a major impact on profitability and overall success of the organization. Here are some highlights from the white paper:

  • Nearly 60% expressed some level of dissatisfaction with their current compensation manage-ment solution.
  • More than 40% reported they are required to use two or three separate systems to gain a complete view of compensation within their organization.
  • 72% of organizations agreed it’s important to have a single system to manage all compensation activities and processes effectively.
  • More than 80% of organizations using Big Data said doing so has improved business results to some extent.

“With many new human capital management products on the market and more than one-third of organizations (35%) lacking an integrated compensation process, many companies are motivated to consider further investments in software,” said Stephan Millard, Vice President and Research Director for Human Capital Management at Ventana Research. “Organizations need to consider looking more broadly than only at those that provide annual market surveys. They should consider options that provide more frequent updates, including those offering good market and industry data.”


In the white paper sponsored by PayScale, Ventana Research concluded that businesses should invest in advanced compensation management systems to ensure they can compete more effectively for talent and meet their business objectives.

The full “Modernizing Compensation Management” white paper is available for download at