Job family wise percentile marking  

Compensation

Compensation design, its fulfillment and servicing is core to driving employees' performance & capabilities. An execution-focused compensation structure will reward both on goals & leadership. It will provide a reasonable differentiation across levels of performance. It will work on near-term to long-term retention and consistency of performance.


Job family wise percentile marking


The organizational policy on compensation can be structured down to the level of a job-family as well. An organization may decide whether it wants to pay above market, below market or at par for a particular job family.

This refers to the positioning of a particular job-family of the organization in the industry wide spectrum of compensation pertaining to that particular job-family. Just like an organization places itself on the overall compensation spectrum of the entire industry, the same can be done at a lower level with a job family as well. This compensation spectrum is arrived at after an exhaustive survey which is usually done by an external agency. For example, at the company level, an organization may be at the 50% mark in the overall industry compensation spectrum. However, it may be paying above the market-median in the Marketing department, say at 75% and below-market median in the Administration department, say at 25%. So for the Marketing job family, organization is at 75% and for the Administration job family, the organization is at 25%. The HR department plays a leading role in this exercise which is a part of the overall management planning exercise. The placement decision is crucial to get the right kind of employee. This in turn further depends upon the relative importance of the function in the overall business.