By Jessica Jones
A competitive compensation package can give your credit union an edge in attracting and retaining top-notch talent at all levels of your credit union. However, a package is only as good as the quality of your workforce planning, says Bob Cartwright, president/CEO, Intelligent Compensation, LLC, Pflugerville, Texas.
“Often, payroll is one of the highest costs in the credit union, and at the top of the list of operating expenses. It should be part of the strategic plan of any organization,” Cartwright says. “Workforce planning ensures that your credit union’s employee rewards align with the mission, culture, core values, and operating objectives of your credit union.”
An important first step to workforce planning is the total compensation philosophy statement, which effectively communicates to your entire organization how all employees will be compensated, including base salary, incentive or bonus plans, and benefit programs.
“This statement serves as the ‘backbone’ of your credit union’s compensation strategy, and acts as a steady reference point to help make decisions moving forward,” says Scott Dettmann, partner/principal consultant, Carlson Dettmann Consulting, LLC, Madison, Wis. “If this statement is done well, it will support the type of organizational culture you want to develop and maintain in your credit union.”
A compensation philosophy statement touches on several topics related to compensation, but it doesn’t have to be complicated, says Dettmann. Typically, the statement focuses on every part of your credit union’s compensation program, and lays out a roadmap clearly describing how the program supports your credit union’s goals, and how the success of the compensation will be measured.
With your philosophy statement in place, your credit union can begin the crucial practice of workforce planning. A major component is understanding the market and how your competitors and peers are compensating talent, says Cartwright. Using survey sources that provide data on cash compensation as well as benefits packages gives your organization a foundation for its compensation strategy.
Workforce planning will not only help you become more competitive in attracting and retaining employees—it also provides a layer of security in a time when executive compensation is being strictly scrutinized within financial institutions. Having a total compensation strategy and a review of the compensation in place, especially for C-suite executives and senior vice presidents, can protect your credit union.
Jessica Jones is a freelance writer.
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