AI and Changing Technologies
Where the Monsters Lurk: The rapid emergence of Artificial Intelligence (AI) and other new technologies introduces two distinct types of monsters to your comp landscape:
- Data Security Threats: New platforms and systems can bring vulnerabilities that compromise your sensitive compensation data. These monsters feast on unprotected information and they can be terrifying since comp pros work with such sensitive information.
- Emerging Jobs: New emerging roles or skillsets (especially those focused on AI, machine learning, and automation) throw new hurdles for accurate job pricing. A lack of established market data and comparable roles can make market pricing feel more like guesswork.
How to Protect Your Program:
- Ensure Data Confidence: Make sure your compensation team is fully trained and confident in the tools and protocols necessary to protect your data. Treat security as a non-negotiable part of daily operations.
- Trust Your Philosophy: When you need to price unique, cutting-edge, or AI-focused jobs, don't panic. Rely on your established comp philosophy and structure to guide your initial decisions, and use all available market data (even if it's imperfect) to anchor your pricing strategy.
Internal Communication
Where the Monsters Lurk: Compensation policy is only as effective as its explanation. Many monsters emerge at the point of contact! Hiring managers and HR Business Partners (HRBPs) are on the front lines, talking with candidates and employees about pay. Fear, uncertainty, and confusion on their part can quickly lead to unclear, inconsistent, or outright damaging pay conversations.
How to Protect Your Program: Prepare Your People! When managers lack the right language and context, misunderstandings about pay strategy and equity can grow out of control. To keep conversations accurate and monsters to a minimum, you have to arm your managers and HRBPs with the right tools:
- Share the clear reasoning and detailed explanations behind your pay decisions.
- Provide recommended, easy-to-use language they can confidently deploy in challenging conversations about pay, promotions, and bonuses.
Job Architecture Maintenance
Where the Monsters Lurk: Job architecture is frequently considered the foundation of all compensation work, but if it's left unattended, it can fall apart. Outdated structures are a breeding ground for problems. Your job architecture must grow and adapt when your organization does because a static structure quickly becomes obsolete. Even if your program has had the same departments and structures for years, weaknesses often creep in when there's a misalignment between external survey data and your internal job data. This disconnect makes accurate market pricing nearly impossible.
How to Protect Your Program: Time allows any small weaknesses of your job architecture to grow larger and more powerful. Regular checks and systematic revisions are the only way to keep your job architecture strong, scalable, and equitable. Don’t wait for a crisis to emerge, instead build regular maintenance into your routine.
Laws and Regulations
Where the Monsters Lurk: The regulatory landscape around compensation (especially concerning equity and pay transparency) is always evolving. The scariest monsters here pop up when your program isn’t structurally and functionally ready to meet new requirements. Even small, overlooked laws can lead to significant risk, hefty fines, and recruiting/retention nightmares.
How to Protect Your Program: Make it a priority to stay up-to-date on emerging federal, state, and local legislation. Keep your program currently compliant and ready for tomorrow’s laws by knowing what laws apply to your organization and employees.
Program Inconsistencies
Where the Monsters Lurk: Inconsistencies are the quietest, most insidious monsters. They can lurk in any area of your comp program and usually stem from a small misstep or an unbalanced application of policy. A small inconsistency can start a chain reaction, creating severe issues like pay compression, serious equity concerns, and a lack of clear direction or growth paths for employees.
How to Protect Your Program: The only way to stop inconsistency from taking hold is to stay strong in your core compensation philosophy and strategy and plan for routine program reviews. Use your established policy as an unbreakable shield to ensure every pay decision, policy application, and structure update aligns with your overarching compensation goals.