Growing Pains: How to Remain Competitive in the Market

As small companies grow and add employees, the human resource practices that may have worked in the past may need more defined processes to attain company goals.

A recent client had been hiring elite software developers and grouping the new employees into a single engineering job title regardless of skills or experience. A small group of engineers was asked to work on multiple projects requiring a diversity of skill sets. With the company’s success, it hired more engineers with specializations in their respective areas of software and application development. Again, these engineers were all paid the same, despite their differences.

This practice probably met the company’s needs but was short-sighted when considering their long-term plan for attracting talent. With recent expansive growth and a competitive labor market, our client wished to conduct a comprehensive compensation analysis to see how competitive their salaries were in hopes of continuing to attract and retain top talent.

Key components to a comprehensive analysis:

Compensation Philosophy. Before you proceed with market pricing your jobs, it is best to develop a compensation philosophy, determine your company’s relevant labor markets where you compete for talent, and what surveys will ultimately work best for you.

 Job Families. The first step in organizing job titles is to group jobs into large job family categories such as information technology, project management, engineering, sales, and other logical groups. Input from company management will be your best source of information and will help create buy-in for results.

Job Titles. Examine the employees in this group – are there managers, directors, individual contributors, or support staff that fall into the same category? It will be easy to see if job titles have become inflated over time. If possible, split each job family into specific job families. For example, the simple title of engineers might divide into software engineers, software QA engineers, systems design/architecture engineers, or product engineers. If you have access to salary surveys, the job groupings and descriptions can be helpful for laying out a general structure for your positions.

Job Levels. After you have grouped your jobs into specific families, consider the skills and experience of each of your employees within a family and how they fit into different levels. An example might be grouping employees into associate, intermediate or senior levels. Salary surveys can help distinguish between levels of skills and experience. Many of these, such as Culpepper and Radford, have detailed leveling guides which can be a great resource.

 Job Descriptions. Before you start pricing your jobs in the marketplace, you will need to have a good understanding of what individual job responsibilities are. The best way to document duties is to have up to date job descriptions or, at a minimum, a current job summary.

Job descriptions should include:

• Job Title – This is a general title, employees may have the same general job title as well as specific internal position titles
• Job Summary
• Key Responsibilities – Focus on the primary responsibilities that encompass 75% of the position
• Minimum education, experience, and job requirements
• Required mental and physical demands
• Disclaimer indicating the job description may not fully include all job functions and requirements

Organizing your jobs into defined families and writing job descriptions can be a daunting task but will pay off in the long run by saving time, money, and frustration. The foundation you create will significantly improve your market pricing outcome with more accurate survey matching, resulting in survey data that reflects your company’s roles. You can confidently match your company’s positions to correct benchmark jobs and skill levels, which results in a more accurate portrayal of your jobs’ labor market. This can also improve employee’s job satisfaction and ultimately help you reach your goal of attracting and retaining top talent.

Feeling overwhelmed? We can help.

Compensation Works is equipped with industry experts that have the experience and tools required to guide you through a comprehensive analysis, develop or refine job families and titles, develop or recommend the best compensation philosophy approach and support the development of updated job descriptions that accurately represent your jobs.