We’ve barely turned the page on the calendar, but October is definitely here. Signs of the season are everywhere. For those who live in the U.S., this time of the year means searching for a scary costume, making haunted trips to the pumpkin patch, and telling spooky ghost stories.
If you are an HR professional, the frost on the pumpkin means something entirely different. The fall season kicks off the time when employees will receive and complete end-of-the-year paperwork. This typically includes an open enrollment period, and often, compensation reviews.
Because of these activities, compensation-related adjustments will inevitably need to be made. We don’t have to tell you that this is a lot of work. If you are among those compensation managers who are still handling these crucial transactions manually (or by spreadsheet), the responsibility of completing these tasks in an accurate and timely manner can weigh heavily.
What Keeps Compensation Managers Up at Night
According to Oracle’s recent State of HR Analytics 2021 report, more than 55% of organizations continue to use spreadsheets to house employee data and less than half of HR managers report being proficient in gathering and keeping their people analytics data current.
Keeping data current is only a part of the problem. The thought of making a mistake in employee compensation is enough to keep even seasoned HR and Compensation managers awake at night. While employees may be willing to overlook small errors such as misspelling their last name in a company announcement, they are much less forgiving when it comes to the accuracy of their paychecks and total compensation.
With 64% of Americans living paycheck to paycheck, they are not willing to compromise when it comes to paycheck errors. It only takes one payroll mistake for employees to lose trust; in fact, 24% of employees will look for a new job after the first payroll mistake with another 25% choosing to leave after a second issue.
The Scary Ramifications of Poorly Managed Compensation Data
The possibility of making a mistake in an employee’s compensation is pretty scary, but these types of errors are shockingly common, especially for companies that still use spreadsheets to manage compensation activities. Various studies over the past few years report that 88 percent of all spreadsheets have “significant” errors in them.
Beyond payroll errors, compensation data that is inefficiently managed can also lead to the inability to stay on top of crucial business factors. Things like headcount, promotion tracking, and even DEI (diversity, equity and inclusion) initiatives can be at risk when manual entries can’t keep up with the pace of activity. Upstream ramifications include employee disengagement, increased turnover, decreased productivity, and poor customer satisfaction.
Lean on Technology to Rest Easier
There are so many responsibilities that come with the Human Resources role, but there are ways to implement technology solutions to help reduce some of the stress surrounding compensation management. One of the first steps involves saying goodbye to managing compensation by spreadsheet. Implementing a robust compensation management solution can take away much of the burden and bring peace of mind, leaving time for other responsibilities that are inherent to the role.
In fact, there are many benefits to implementing a robust compensation management solution. If you need help making the business case for your organization, you can find plenty of justification in simply reducing the number of manual errors that can lead to employee dissatisfaction. Other reasons include operational, financial, and strategic, which we outlined in last month’s Complogix Blog. We encourage you to take a look!
If you are charged with managing compensation, and if worries about doing it effectively are keeping you up at night, it’s time to talk to someone about a compensation management solution. CompLogix can help. Contact us today for a complimentary demo.