A Guide to Making Bold Compensation Decisions in the Face of COVID -19
In the blink of an eye, our business and personal lives have shifted. As leaders responsible for managing through an economic downturn while preserving the ability to bounce back rapidly, our people priorities have changed dramatically. These uncertain times call for bold (and early!) decisions about staffing and related compensation issues. Taking decisive and appropriate action in the face of widespread fear and anxiety is not easy, but critical. History shows that many leaders under-react, while others make quick, hip-shot choices that fail to achieve the organization’s short and long-term goals. This guide is intended to help you avoid these costly mistakes.
At first glance, it may seem that our choices are limited. Fortunately, though, there are a number of compensation management alternatives to consider before making a final decision. Having these alternatives at your fingertips will make your job easier during this challenging time. But first, a few words of warning:
- There is no single, one-size-fits-all solution, and your decision needs to factor in your unique culture, situation, and timing.
- Some of the best solutions may entail creatively combining various alternatives to best fit with your team and your goals.
- Consider involving a small circle of trusted advisors (internal and/or external) to test alternatives prior to finalizing your decision.
- Remember that how you communicate your decision is key. Experts always suggest communicating a change honestly, and if possible, planning for a single roll-out of messaging- not a drip, drip, drip of bad news as a crisis unfolds. (Rip the band aid off.)
With these thoughts in mind, below is a list of possible alternatives for managing costs, while retaining your most valuable employees:
|1. Staffing Alignment||
|2. Compensation Adjustments||
|3. Modifications to Benefits/Perks||
|4. Employee Retention/ Organizational Development ||
As it turns out, there are many approaches to managing your most important investment during this critical time. The trick is to select the right one or ones that enable you to:
- Achieve the savings you need in the short term
- Act in alignment with your culture and values
- Demonstrate your understanding and care for those impacted by the changes
- Retain your best employees- the very people who will help you to turn the corner and achieve your longer- term goals
Making the right decisions in a timely manner is challenging. History reveals many otherwise effective leaders who failed to do just that during times of crisis. With careful and prompt planning and thoughtful, honest communication, this moment can be a positive and pivotal one for your team.
Admittedly, it’s a tall order. But a bold and timely decision will ensure that you are poised for the future, and ready to put a global pandemic in the rearview window.