What’s the True Meaning of Compensation Philosophy?


Compensation philosophy doesn’t mean what most people think it means. A philosophy is a set of ideals, standards, or beliefs used to describe behavior and thought. A well-designed compensation philosophy will therefore focus on why you pay the way you pay, not on how much you pay. Yet, too often, we fall back on clichés like, “Our compensation programs are designed to attract, retain, and motivate employees” – when we know our programs do little of this. We use phrases like “world-class talent” to describe roles of every level. And, while we might have a philosophy that says “We pay at the 50th percentile of the market,” it means little when 95% or more of all companies target the same pay levels.

If this sounds familiar, it’s time to rethink your compensation philosophy. An effective philosophy should go far beyond where you pay someone relative to the market, and instead focus on the factors behind your pay decisions. In this month’s webinar, discover the complete picture of compensation philosophy and how you can leverage it to make a meaningful impact on your workforce. Join Dan Walter, Managing Consultant of FutureSense, LLC, as he puts compensation philosophy into a new perspective.

Attendees will learn:

  • How to craft a pay philosophy that reflects reality
  • Tips to communicate and leverage incentives
  • Ways to build a philosophy that helps you make better decisions for outlier cases
  • How to use your philosophy to modulate behaviors that align with your company’s success


Dan WalterAbout the Presenter

Dan is a managing consultant at FutureSense, a holistic human capital consulting firm. He has worked in the field of compensation since 1994. Dan was previously the founder of Performensation. His expertise includes equity compensation, performance-based pay, executive compensation, and talent management issues. He has also been the architect of software solutions and administrative and technological best practices used by many companies. Dan has coauthored several books on compensation and is a popular blogger on the topic. He also does dozens of presentations every year.