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Does Your Organisation's Remuneration Plan Need an Intervention?

Ever wondered how your employee's are faring on the ground? What more can You do to enable better work satisfaction and performance from your team? In the following article, Prof. Dr. Mark Bussin highlights why your organisation's remuneration plan could be a huge factor in this matter and what you can do to improve it.


Article by Prof. Dr. Mark Bussin

There comes a time when you discover your Remuneration plan is out of sync with the organisational objectives or with the market at large. Maybe your Remuneration plan is not achieving the results or behaviour you had intended for it to achieve. Possibly it is not retaining or engaging your employees…

Unhappiness with one’s Remuneration plan isn’t quite an uncommon occurrence. In fact, approximately a third of companies have displayed dissatisfaction with their Remuneration programs. David Cichelli, vice president of the Alexander Group (a consulting firm that focuses on revenue growth), stressed the urgency for sales leaders to gain an intimate understanding of the true functioning of Remuneration plans. He stated, if your organisation has an inadequately-designed Remuneration plan, it will work… but it will work against your organisation’s larger goals.

Where are you going wrong?

First-off, a diagnosis is important. Where are the problem areas in your Remuneration plan? What is kicking the system out of balance? Where does one start looking? Here are the typical areas of diagnosis that might help you uncover the problem:

  • Low morale among employees: have your employees been disengaged, with Remuneration being the chief perpetrator?

  • High turnover: Has staff turnover moved at an alarming rate? We’re not speaking about retired employees or other such natural occurrences… rather, we are speaking about the unexplained.

  • Difficulties in recruitment: Has it become increasingly difficult to attract key staff? Has anyone pointed out that your pay scales aren’t competitive against market rates?

  • Payroll: Is your payroll cumbersome? Your cost of labour too high?

  • Are employees thinking of equal pay for work of equal challenges?

These are not the only challenges your Remuneration program may be facing, but they are generally the common suspects. After poking and prodding at the exoskeleton of your organisation and coming to find that the problem lies a little deeper, you will need to get under its skin.

How can one do this?

Employees, more often than not, will avoid going to the boss and telling him/her what they are doing wrong. As a general rule of thumb, this isn’t quite a clever idea. It is therefore your calling to take the initiative and find out for yourself. Consider this- have you ever watched an episode of ‘Undercover Boss’? If you haven’t seen it, Google articulately summarises it as follows:

“High-level corporate execs leave the comfort of their offices and secretly take low-level jobs within their companies to find out how things really work and what their employees truly think of them. This Emmy-winning reality series utilises hidden cameras to provide an authentic view of executives' journeys as they are immersed in the day-to-day operations of their organisations. In the process of this undercover mission, they learn of the perceptions about their companies, the spirit of their work forces and -- maybe -- something about themselves as well.”

These high-level corporate execs are usually disguised with an authentic-looking wig, contact lenses, an altered skin tone, a very street-wear dress-sense or the likes. Seemingly, this is a great idea to uncover inside information as to the functions of your company.

Or you could just ask.

Why not involve all the stakeholders in the process? Gauge what your employees value most. Prod around at key management personnel and interrogate them about the reward programs. Ask questions that will uncover whether reward programs are achieving the desired outcomes, whether they are sluggish or efficient and whether they could be improved.

Another suggestion is to consult your Remuneration metrics. The figures can tell you:

1) How competitive your salary ranges are (a salary survey lik