Compensation Impact Q: when do you need an integrated HR Suite?

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About the Compensation Impact survey

compensation impact survey

The survey was completed by 204 HR professionals from a wide range of organizations. The distribution of company size is shown in Figure 4.

What do companies like (or dislike) about compensation software?

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If you are considering getting  new compensation software,  then it’s helpful to learn from the experiences of your peers.

Our survey asked a variety of open-ended questions  about  what companies  liked or didn’t like about  their compensation software.  The two main issues for small companies  were ease of use and flexibility; for mid-tier and enterprise  companies, integration was also an issue (see Figure 3).

 

Figure 3: Features  of compensation software most  frequently cited

 

 

Important  features

 

Small organizations

Mid-tier & enterprise organizations
 

Easy to use, learn, and implement

 

66%

 

50%

 

Flexible, configurable,  and comprehensive

 

26%

 

21%

 

Integration  with other systems

 

5%

 

25%

 

Cost

 

3%

 

4%

 

While no one mentioned global capability unprompted, when asked  if global capability mattered, 41% of companies with  over 1000 people listed  it as one  of the deciding factors.

 

Takeaways for small organizations

 

Takeaways for

mid-tier & enterprise organizations

 

1. When buying compensation software,  pay attention to ease of use, ease of training, and ease of implementation.

 

2. Be sure that you get the flexibility needed for your business needs now, and likely needs in the near future.

 

1. In addition to ease of use and flexibility, look closely at integration issues.

 

2. If you are a global firm, then the capability to handle global currencies will be a deciding factor in your choice.

When do you need an HR suite?

One perennial concern of HR leaders is whether the need to integrate different software packages  will create problems.  Overlooking integration issues can create headaches. On the other hand,  overemphasis  on buying pre-integrated modules can lead to headaches as well.

Pre-integrated but underpowered or inflexible modules often lead HR managers to leave the module unused  and instead go back to doing the work in Excel.

Each situation is different; for your specific situation, ask:

  • How much better is the standalone tool?
  • How difficult is integration in this case?

 

 

Takeaways for small organizations

 

Takeaways for

mid-tier & enterprise organizations

 

1. Integration  is usually not a top concern for small firms.

 

2. Compensation software  is usually Excel or an

in-house solution; people in the company may be reluctant  to switch.

 

3. Track the hours spent on compensation to determine the cost benefits for your organization.

 

1. Find another company that has done the same integration you are considering to learn exactly how easy or difficult it is.

 

2. Run a range of test scenarios on any software you intend to buy so that you don’t get stuck with a solution that is integrated, but can’t do the job.

 

3. Even though your company is big, getting  a suite to change  compensation software requires numerous requests  and is not likely.

 

The link to performance management and HR Suites

This survey focused on compensation software; however, it’s important to see compensation software through the lens of performance management.

Often the biggest issues in performance management arise from the compensation element, and if you don’t get this right it can be hard to get people to focus on goal setting or individual development.

Compensation Impact Takeaways for all organizations

1. One of the most important features of compensation software is that it should support making the right compensation decisions as part of the performance management process.

2. Get the compensation side of performance management sorted out first, and then
managers can concentrate on goal setting and development.