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1) Start by developing a compensation program plan
First, set the objective for your organization's plan.
Then, it is important to set targets with dates and smart goals for the execution and completion of tasks.
Lastly, it is essential to determine a budget for your organization. Below are trusted non-profit resources to check out for more content on how to do budgeting!
2) Designate a compensation manager to overlook the design process
Firstly, determine who will be responsible for this position. Then, make sure to establish the designated position for the short-term or long-term.
While this position is usually filled by the Human Resouce (HR) department, it is important to evaluate the cost of looking for candidates outside and inside the organization.
Another alternative is to hire a professional compensation consultant to help strategize an approach for an effective employee compensation. This would provide expert knowledge on evaluating current compensation strategies and developing new policies for the respective organization.
Check out the resources below to get started on finding the right partner for your non-profit:
3) Form a compensation philosophy
One idea is to form a compensation committee that includes members of the organization.
This step is dedicated to determine how competitive the organization is going to be in comparison to the industry's standards. This covers things such as whether the salary should be increased or decrease, and whether monetary compensation should be used in placed of benefits and more.
You can also discuss the differences in pay structures in this step.
Learn more on compensation philosophy with these amazing article and podcast below!
4) Conduct a job analysis for all positions within the organization
Conduct general task analysis according to the organization's main departments. Make sure to get inputs from senior members from appropriate departments to determine potential job structures and their fundamental functions.
Then after the classification of job positions proceed to the interview process of key managers and employees to establish specific job functions. Make sure to discuss which job positions will be exempt or not as well.
Develop a final job description of all the positions and make sure to review it with the managers. After that, finalize all the necessary documents for the job description.
Then, rank the jobs among departments and verify ranking with the industry's standards and adjust if necessary.
Finally, develop a matrix of jobs based on tasks and business plans, and compare it with the organization's structure and industry market data. Don't forget to create flow charts for each department's ranks and present them to the compensation committee for review and adjustment.
Check out the articles below to learn more about organizing positions within an non-profit:
5 ) Determine and Establish grade pricing and salary range:
First, establish the different types of levels for each job family and assign a grade to each level. Make sure to determine the number of monetary ranges for particular job levels.
Senior
Junior
Intermediate
Beginner
Then set benchmarks jobs which are initially the key jobs within the organization. Review the market price of the benchmark within the non-profit sector. Finally, establish a trend line as to where the organization wants to stand in terms of the salary range.
Salary Benchmarking: Importance, Steps & Tips
Salary Benchmarking: Importance, Steps & Tips
By Indeed
6 ) Establish an appropriate salary/pay structure for the organization.
Calculate the difference across each income level. Also, define a minimum and maximum percent range of income and organize all of the other jobs.
Make sure to check job descriptions to confirm the purpose, need, or other justifications for sustaining a position.
In the end, arrange a meeting with the compensation committee for review, modifications, and approval.
Check out this super useful resource created by Lisa McKeown and Tina Twyman from Total Rewards.
Getting-Serious-About-Your-Nonprofits-Comp-Structure_finalslides.pdf7 ) Developing the organization's administrative policy
Create and document the general organization policy, as well as for selected groups.
Make sure to define a strategy for merit-based raises and other kinds of compensation increases for employees. Including cost-of-living adjustments, bonuses, and promotions. It is also essential to establish procedures that reinforce the policies made.
Same as in Step 6, arrange a meeting with the compensation committee for review, modifications, and approval.
Check out this helpful resource to learn more about administrative policies and other must-have!
By Foundation Groups
8 ) Grant Approval from top executives for the basic salary program
Create cost impact analyses that forecast the expenses of increasing current staff levels up to the recommended levels.
Communicate the data to respective compensation committees for feedback, adjustments, and approval. The data is then presented to the executive committee for final assessment and approval.
9 ) Communicate the final program with employees and other staff
Prepare a presentation for approval or modification to executive staff managers and the compensation committee.
Then create a strategy for communicating the brand-new initiative to employees, incorporating slide shows or clips, handouts, and other creative outlets.
Present the compensation programs to your employees and staff including the details of the design process and its procedures.
After that, collaborate with the right Human Resource Information System (HRIS) to find effective ways to monitor progress and report to senior managers.
Define the format and specifications for the reports before doing test runs on the HRIS.
Lastly, proceed to execute the program!
To learn more about effective communication ideas and how to implement an effective HRIS view the articles below!
Important note!
Important note!
Important to note that several studies have communicated that the implementation of IT contributes to organizational growth and success. That said, organizational leaders should utilize IT systems to generate information that will provide the foundation for future organizational innovative and sustainable activities for their respective organizations. Therefore, make sure to choose the right HRIS for your organization. Check out some HRIS software options known to be helpful for non-profits by Springly!
8 ) Monitor your implemented compensation program!
Make sure to monitor feedback from designated managers.
Be prepared to make adjustments to some components of the program depending on what is working well and what isn't for the employee compensation plan moving forward.
Then again make changes where necessary.
This is important to be consistent in monitoring and evaluating the process for the effective performance of your overall organization!
Check out these helpful articles for more information on implementing better compensation strategies within your organizations
Check out these helpful articles for more information on implementing better compensation strategies within your organizations
Write your non-profits business plan!
Write your non-profits business plan!
8 steps explained by Amber Melanie Smith a non-profit founder and executive director of Activate Good.
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