We put the Talent in Applications

  • Authors

  • Blog Stats

    • 611,143 hits
  • Topics

  • Archives

  • Fistful of Talent Top Talent Management blogs
    Alltop, all the top stories

Compensation budgeting to retain your best talent…

Posted by Anadi Upadhyaya on June 24, 2012

Compensation budget is an organization’s financial commitment towards compensation awards for its workforce. It’s a lifeline for compensation management process.  A performance linked compensation budget for your managers to work upon will help you to retain your best as top talent always have more options and  you may always run into a risk of losing talented workforce to your competitors.

If your compensation allocation objective is to attract, retain and motivate best talent than performance linked budgeting is the key.  Adoption of merit linked budget over the fixed budget will provide that required extra room for distributing compensation to your best talent, to achieve your organizational goals.

Be it a fixed number or a number based on some prorated value (such as on base salary), a manager with more talented people should have more budget in his disposal to allocate workforce appropriately. Use of organization or division wide performance linked budgeting guidelines will ensure consistency as allowing discretion beyond a point may result in derailment from original purpose. To enforce consistency, variation beyond an accepted threshold should not be permitted.

Choosing performance linked budgeting over the fixed budgeting gives an extra boost to your pay for performance system.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: