How Do I Become a Compensation Analyst?

Salary analysis is the process of using a variety of analytical methods to comprehensively analyze the salary data of an enterprise in a certain period of time, so as to reflect the current status of salaries, diagnose salary deficiencies, promote human resource reform, and propose optimization suggestions.

Salary analysis

The importance of salary analysis is reflected in the following four aspects:

(1) Describe the salary status and reflect the current status of human resources.

Describe salary status and reflect the current status of human resources. The description function is the primary function of salary analysis. Through salary analysis, we can understand the company's salary level and salary distribution status in a macro and systematic way, and accurately grasp the company's external competitiveness and internal fairness.

(2) Evaluate salary plans and consider human resource decisions.

Evaluate compensation plans and consider human resource decisions. Decision-making After the design and implementation of a compensation plan, the specific effect needs to be evaluated by compensation analysis. Through various indicators and analysis techniques, objectively evaluate and consider the correctness and effectiveness of human resource decisions at a certain stage.

(3) Diagnose the shortcomings of the remuneration system and promote human resource reform.

Compensation analysis follows the following principles:

(1) Authenticity

Compensation analysis is based on real data. Authenticity is specifically reflected in three aspects:

First, in the original collection and processing stage of salary data, we must strive to be accurate and true, without omissions or false reports.

Second, the salary analysis data is not limited to actual data. The second stage after the collection of salary data is the alienation process. In order to facilitate historical comparative analysis, some special abnormal data that can affect the conclusion of the analysis must be excluded. At the same time, comments in the analysis report Explain to ensure that it truly reflects the objective situation.

Third, use external pay survey data with caution. Because of the confidentiality of salary data, there is often a subjective or objective error in externally acquired data. Care must be taken when using external salary data to use it carefully and selectively.

(Two) long-term

The time span of salary analysis is generally more than one year. Moreover, salary analysis also focuses on vertical historical analysis, and data comparison may involve data in recent years. The long-term nature of salary analysis is mainly based on the following three reasons: First, the workload of salary data analysis is large, and the short-term analysis is too frequent, which is not conducive to simplifying the workload. Secondly, salary data of more than one year can be statistically significant to reduce errors due to special fluctuations in individual months through large-scale data. Third, the annual analysis is in line with working habits such as accounting settlement and year-end summarization, and is consistent with the time when other reports are generated in the same period, which is conducive to the expansion of salary analysis.

(3) Systematic

The system is concretely reflected in three aspects: First, compensation analysis must be placed in the entire compensation system of the enterprise to make sense, and we should adhere to the macro analysis. Secondly, in addition to the analysis of compensation amount, the analysis of compensation system structure is also an important aspect of compensation analysis. A well-ordered and reasonable system must have a reasonably optimized structure. Third, compensation analysis and improvement suggestions should be more focused on structural optimization, and compensation improvement must not only be an increase or decrease in absolute numbers, but also structure optimization and a reasonable incentive system.

(Iv) Comparability

The comparability is specifically reflected in three aspects: First, the salary data must be comparable. The method to ensure the comparability of data is the same period of data collection and alienation processing. Second, salary data comparison is an important method of salary analysis. Internal comparison reflects internal structure and internal fairness, and external comparison reflects external competitiveness. Third, the salary analysis conclusions must be comparable. Through the horizontal comparison of some objective indicators, the comparability analysis conclusions of the salary analysis can be drawn, which is convenient for the historical analysis and improvement of the salary.

Formal method: reflect, collect and feedback some information, materials and questions of the organization's compensation management through normal management channels; organize a specialized problem analysis team, compensation experts and managers to analyze these problems in a timely manner; report the analysis results to a diagnostic report And the formal form of the diagnostic program is submitted to the relevant management and decision-making departments.

Non-formal salary diagnosis refers to employees 'timely reflection of problems in salary management through some internal and flexible communication methods; at the same time, the organization's compensation supervisor can timely listen to employees' opinions, suggestions and even complaints about compensation policies and compensation management. Compa Diagnostic tool, Compa = Average pay rate actually paid / midpoint of pay range. Used to measure and diagnose various aspects of the compensation system, such as external competitiveness, individual fairness, incentives, etc.

1. External competitiveness of compensation. If Compa is equal to 1, it indicates that the current salary level is market-following; if Compa is greater than I, it indicates that the current salary level is market-leading; if Compa is less than 1, it indicates that the current salary level is market-lagging.

2. Internal consistency of salary. The midpoint value progressive coefficient of the salary grade can define the progressive increase of the midpoint value of the connected grade. The midpoint value progressive coefficient of the salary grade = (high grade midpoint value-low grade midpoint value) / low The midpoint value of the level. The progressive coefficient is 0-0.5, indicating that the employee's salary is between the minimum value of the salary level and the midpoint value.

3. Individual fairness and motivation of salary. When Compa equals 1, it indicates that the compensation of most employees is at the midpoint of the salary scale. ^[1]