Understanding the Changing Compensation Landscape for Top Talent
Compensation planning is crucial for attracting top talent. With a dramatic shift in talent acquisition this year, using historic compensation bands and leveling practices as a mechanism to access top talent will create a challenge in securing the top quartile of executive talent in the marketplace. Hiring managers and recruiters need to understand how profoundly the compensation landscape has changed in order to successfully attract the best talent.
The Importance of Compensation and Top Talent
McKinsey reports that high performers in entertainment, athletics, politics, and research are 400% more productive than average performers. In more complex occupations, including management and software development, this increases to 800% more effective.
Simply put, attracting top talent allows your business to complete projects more efficiently and achieve your goals more quickly. Of course, recruiting the best candidates gives your organization a significant competitive edge in that pursuit. Prepare to elevate your approach to compensation when securing top quartile executive talent in this environment. Making offers based on widely published compensation bands will likely leave you out of step with the competition and the talent pool.
The Importance of Understanding the Changing Compensation Landscape
Some recruiters may make the mistake of believing that offering competitive compensation initially is enough. However, if your best people receive a better offer at any point in their career, if the only thing keeping them is compensation, they will leave for a better offer.
Due to this risk, hiring managers might consider replacing historically effective standard rates for salary increases with dynamic programming. Particularly with respect to top executive talent, maintaining a nimble stance with respect to market compensation will allow the construction of time-relevant and attractive overall compensation changes.
Failure to enact dynamic compensation programming for top executive talent exposes organizations to an incredibly competitive market. Partnering for expertise in this regard can be paramount.
All businesses should remember that offering competitive compensation will help attract top talent, and the target for what is considered “competitive compensation” is shifting in a highly competitive environment for top talent. Maintaining a market and talent-driven program that adapts to the external environment may be more effective than continuing historically effective band and leveling strategies going forward.
BrainWorks is a prominent boutique executive search firm offering a 29-year track record of successfully sourcing and placing top talent. By harnessing proven strategies, collaborating with stakeholders, and leveraging a diverse and talented candidate network, BrainWorks helps businesses find, attract, and ultimately hire talented professionals that create differentiated results. To learn more about how Brainworks can help you, contact us.