However, there’s another major business discipline HR/Compensation professionals can learn from: Marketing.
I am personally fascinated by Marketing and how much in common I think it has with Compensation. Let’s take a look at some of the similarities between the two:
1) Market intelligence
Marketing provides the company with information on what is happening in various marketplaces, what the issues are and what competitors are doing. Marketing also looks at supply and demand by market to determine if there enough demand to support a new or improved product.
Compensation needs to research supply and demand in all company locations; who competitors hire from, who they lose people to, what the market compensation position is and what jobs are “hot”. There is more to market research than just looking at survey information.
Marketing differentiation is the way a company makes its products/services more desirable than similar products/services of its competitors. Marketing looks for ways to differentiate – to make products “stand out” and be noticed in the market. It is the heart of market competition.
Compensation needs to differentiate total rewards from that of competitors by perhaps offering unique rewards to all employees or by creating different reward packages for different employee groups. Following “best practices” does not make a company “stand out” and be noticed.
Marketing segments by dividing the entire market into groups of individual markets according to each group’s wants/needs and how people in those individual markets make buying decisions. If done properly this helps to focus marketing campaigns on what attracts and interests people in each market. It prevents the company from investing too much time and money on trying to sell products that an individual market doesn’t need or want.
Compensation usually does segment employees by performance and supply/demand. Employees that are in short supply get higher salaries both at joining (attraction) and during employment (retention). And those whose performance is superior get larger salaries/bonuses at merit review time. But a majority of other companies do this too. This is just following “best” practices”.
To step it up a notch, Compensation needs to segment critical jobs from the rest. These are the jobs that top management needs to invest more money, time and attention to as these are the ones that have the greatest impact on meeting the company’s goals/business strategy. Therefore Compensation needs to insure that critical jobs are well rewarded.
Marketing tailors messages to different types of customer groups and leverages different communication channels. This is very important and something that Marketing typically does well.
Compensation needs to do the same. As it is, Compensation usually uses the same communication pieces/channels to communicate messages to all employees.
Using some of Marketing’s communication methods would help in creating material for each diverse employee group that makes up a company’s workforce as well as using different channels. Example: There is little use in expecting production workers on the manufacturing floor to access a Compensation message produced online when they have no access to computers.
Developing a Marketing mind-set could go a long way in helping Compensation professionals add value. And all they have to do is walk down the hall to learn how.
Jacque Vilet, President of Vilet International, has over 20 years’ experience in Global Human Resources with major multinationals such as Intel, National Semiconductor and Seagate Technology. She has managed both local/ in-country national and expatriate programs and has been an expat twice during her career. Her true love is working with local national issues. Jacque has the following certifications: CCP, GPHR, HCS and SWP as well as a B.S. and M.S in Psychology and an MBA. She belongs to SHRM, Human Capital Institute and World at Work. Jacque been a speaker in the U.S., Asia and Europe, and is a regular contributor to various HR and talent management publications.