How to Use Compensation Analytics to Tell a Story

This is a lesson from our forthcoming ecourse on compensation analytics, and builds on our previous post on how to dig into comp analytics for specific questions. Be on the lookout for the course launch, which includes helpful examples and insightful exercises — coming soon!

You’ve done it! You spent some time making sure your compensation plan is current and that it prioritizes the things that drive organizational success. Then you explored the analytics that help you track compensation, calculated them for your organization and dug deeper into some particular issue areas. You’ve found a few things you’re getting right and some that need improvement. In HR circles, we talk a lot about getting executive buy-in, and sometimes that means proving it. Having done your homework, you’re well-poised to prove it. But promise us this: Don’t just plop down a graph or chart and assume your executives will see the same insights you do.

They may or they may not, but there’s no guarantee that they’ll understand the message from a few numbers, charts or graphs. After all that work to develop a stance and gathering data to prove it, make sure you take the time to determine the best way to deliver your message. Rather than leading with the charts, lead with the story. In fact, don’t even show the charts until they ask for them. Deliver your compelling, fact-based story and suggest the appropriate course of action. Then show them the numbers that substantiate your claims.

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Know Your Audience

The first rule of storytelling is to know your audience. The right way to tell the story is going to differ from organization to organization, so consider your organization’s executives: What matters most to them? Is it meeting the bottom line? Take that angle in your story. Is it diversity? Demonstrate how your organization has been slowly resolving the pay gap and improving pay inequities across racial and ethnic groups. Is it innovating? Show them how paying your innovators the right variable pay will help your organization create new products and features to get ahead of your competition.

If you work with a lot of scientists or engineers, you won’t get too far before sharing and defending the specific facts. You may even have to share the formulas you used and let them recalculate your numbers. For some, that’s the path to believing. That’s okay. The story still matters in those cases, it just gets told a little differently.

Don’t just plop down a graph or chart and assume your executives will see the same insights you do.

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Identify the Main Story Line

Why are you there? What is the problem? What did you find out and what do you propose the organization do to solve the problem? Clarify the key messages you seek to deliver and keep it concise. Typically, you’ll want to stick to one or two main ideas, and use your analytics and specific examples to support your points.

For example, maybe your main idea is that your organization is missing the mark on paying fairly, and it’s impeding your ability to retain and attract the talent necessary to accomplish your annual business goals. Under that main header, you could group the following key conclusions:

• While you have targeted the market appropriately for your most competitive jobs, you have recently discovered that some high-performing employees in those jobs are falling low in the market.
  
• Some departments have measures that are too “easy,” while some are more “strict,” and you’ve uncovered that pay varies dramatically between the two groups.
  
• You recently completed a pay equity audit and have some compliance concerns.
  

By identifying a main idea, you’re able to pull a thread through your story that makes a bigger impact, and also makes it easier to remember. When it comes to identifying the main idea, sometimes it helps to start with the examples and look for key themes that run through them. It’s likely that there are some, but don’t reach. If it’s not there, it’s not there.

Practice Exercise:

Earlier you crunched a bunch of numbers around your most critical role. Start by listing the major insight you gained from each analytic measure. Then look at the set of insights together: Do they all seem to point to one key conclusion? Ideally, you’d have a few of those key conclusions to combine under one main idea.

Craft and Deliver Your Message

Once you know the main message and supporting points, it’s time to weave the threads together. First, gather all the information to support your story. You’ll have your analytics, insights, key conclusions and main idea. Begin putting them together in a way that tells the story you need to tell. You’ll also want to make sure you can answer any questions that may arise.

Here’s a useful framework to use to ensure you have what you need:

• Identify the question. What’s going on with X critical job?
  
• Ask yourself, what’s the concern behind the question that’s bringing it to the surface now? A few concerns may underscore the question. Maybe some key people have left that job recently. Maybe they’re afraid that having you track compensation more closely will shed light on their practice of throwing unreasonable amounts of money at individuals to get them to stay. Or maybe they’re about to embark on a new initiative that relies on this role so they’re trying to make sure they have their ducks in a row.
  
• Consider the appropriate response. Here’s an example: “We are aware that we’ve just lost some really talented people in this role. We’ve recently evaluated our strategy for compensating this position and find that it’s very competitive to the market. We are positioned well to retain and attract people to this role with our compensation and total rewards. The goal with our compensation plan isn’t to limit our ability to do what we have to, but to make sure that when we spend big, we get the results we’re after.”
  
• Ask yourself, how can I substantiate my claims? Here’s how you might frame your response: “Let me share the results of the study for this position. As you can see, the job is scoped appropriately, we’re targeting the 75^th percentile and the market-ratios and compa-ratios for the people in the job are all high.”
  
• Tie it up and lead to the ask. It might look like this: “We are in a good position with compensation and total rewards for this position. I’ll continue to track it. In the meantime, let me update you on the recruitment efforts. I recommend we consider working with an outside recruiter for this position to develop the right talent pipeline.”
  

Some key things to note: The analytics came in fairly far down the line and were used to substantiate the claim only; they weren’t intended to speak for themselves. Also, make sure your messaging is well-thought out, prepared and unapologetic, yet acknowledges the unfortunate loss of key people. Good luck!

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What tools do you use to make communication easier? We want to hear from you. Tell us your story in the comments.

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