compensation management checklist

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Avoid The Hidden Costs of Compensation: the Proven Compensation Management Checklist


Imagine your company is moving forward with the compensation software you recommend, and in the beginning it’s smooth sailing.

Your company recently invested in new software for handling payroll or compensation, and your department has just completed the months-long process of configuration, testing, and training.

Excerpt from:

How To Get the Right Compensation Management Solution by asking the Right 10 Questions

A month into deployment, the company’s business rules change in a way that will require major changes to your specifications document. That’s when you discover that the vendor can’t accommodate your changes.

One of the first questions you need to ask before engaging your company, and the vendor is, how much configuration will be needed?

To help you avoid being trapped by these and more questions, the experienced Kinixsys team has collaborated on the following checklist of questions, based on a number of common workflow situations that a good software system should be able to address.

Follow this checklist as you prepare to choose your compensation management software.

The Mini Compensation Management Checklist


  1. How often do your processes, business rules or work-flows change, and can you or the vendor reconfigure parts of the system to change with them?

This is probably the most critical question to ask up front. If you have situations  unique  to  your  organization,  you  want  a  product  that  can accommodate those special cases. The best systems will have the built-in flexibility to allow you as the application administrator to update things like eligibility requirements, guidelines, recommendation stages, and other critical settings. But at the very least, you will want to know if this is a “one size fits all” application that can’t be changed by either you or the vendor.

Avoid the “one size fits all” myth.

Compensation software is often customized; what will it cost, and how long?


  1. Is the vendor HR focused, or are they an IT company?

There are a lot of common errors that occur during the typical procedures that use spreadsheets and homegrown systems.  Many of the calculations are tricky and highly interdependent, so that a small error can have rippling effects on an entire employee group.  

  • Does the vendor understand the politics and nuances of compensation planning or are they focused only on the IT impact?
  • What  are their core competencies?
  • Which company(s) are good at communicating effectively with you from the start?


  1. Are you looking at a suite of products, or a point solution?

There’s something to be said for integration, but find out what they started with, and where their core competencies lie. Were they, for example, a Performance Management vendor who added a Compensation module after the  fact?  Did  they  build  the  suite  themselves,  or  acquire  other companies to build out their offerings? Even if all the capabilities appear to be there, there may still be lots of issues with how well the applications really fit together.


  1. What  happens when you hit a bump in the road?

What is the customer support process and turnaround time?


  • Is there a project manager assigned to your account who’s available by phone any time there’s a problem?
  • Or will you have to log a ticket and wait for a response?
  • Smaller vendors tend to be more available and responsive; the larger the vendor, the longer the queue for technical assistance.


    5. Will  it mine the data for executive reporting?

If management doesn’t get timely, accurate reports the system will not succeed.

Can it plug in to your payroll and benefits systems too?


Remember to:

> Ask good  questions up front,  so you don’t get any crashes or bumps along  the way.

Compensation is only one example of a software “solution” that creates a problem. Delays can happen in many situations, and that’s why it is always a good idea to know the potential areas of shortfall before you commit your company to a new automated compensation system.

> Make sure this system accommodates any changes you may need in the foreseeable  future?

First you have to know, from a solid compensation plan, what your future might look like including your current HR Tools and software, the data and performance. If you’re not sure about the answer to this question, plan on extra costs, which are common because few “off the rack” compensation management software solutions exist, and only a few adapt.


Download the complete White Paper here:

How To Get the Right Compensation Management Solution by asking the Right 10 Questions

compensation management checklist