The keys to attraction and retention are transparency and process. Just like having a strong interview structure, Compensation structure is just as critical.
Having clearly defined salary thresholds allows people to be comfortable with your environment while eliminating uncertainty in the minds of your employees.
Louis Beryl is the founder and CEO of Rocketplace, a curated marketplace of high quality professional service providers. A 3x founder, investor, and board member, Louis began his tech career as a partner at Andreessen Horowitz and was also previously a YCombinator Partner part-time. Outside of being an entrepreneur and investor, Louis is an avid cook and has recently been perfecting his homemade pizza.
Today we discuss:
- Benefits to establishing a compensation structure early on
- 4 step process to building a successful comp plan
- Setting a correct compensation structure
- Disparity in salary
- Miscalibrated pay system
- How to promote and compensate properly
Why is this important to the company?
Ultimately compensation to align with the values of the company
- tighten range of cash & equity
- Wiggle room for negotiation
- Tradeoff flexibility
- Determine range of percentile before you start ( Netflix 110%)
- Trade off on higher compensation is a recipe for disaster
- Compensation is what does NOT determine the level
- Provides organizational transparency
- Manage expectations & promotions
When compensation changes, adjustments are across the organization
How do we build a compensation structure into your company?
Talk about what values you have in your compensation package
- People feel that teammates will be paid very similarly
Build compensation Matrix
- Cash, quality, bonus, etc
- Determine levels
- Functional areas
- Collect data (compensation data)
- Determines what percentile your organization is willing to pay
Leaders need to define what each level is
- Interview process at each level
- Promotion process
Live values through the interview process
- Adjust the interview process according to the interview
- Think about what you value
- Think about compensation in advance
- Develop methodologies to allow the organization to scale
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