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        Mark Smith's Analyst Perspectives

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        Mercer Updates Total Compensation Management To Help Retain Talent

        To retain talent, organizations must ensure that their workforce’s compensation is comparable to that of their industry peers. As part of this effort, they should integrate compensation reviews with goal and performance reviews to ensure employees are paid their fair market value; otherwise the best talent will become a flight risk. Many organizations understand this; in our performance management for talent management benchmark research, two-thirds said they want to integrate compensation with the review process. But most companies have more to do; they need to establish a continuous process that compares all information on new hires, promotions and market events, at least as part of an annual performance review or preferably every quarter. They should not delay change until employee feedback or exit interviews indicate that being underpaid is a primary reason for people leaving.  

        Mercer, which provides information, software and consulting, has helped organizations in the area of compensation for 25 years, since personal computers led to benchmarks being developed and automated. Today, the company’s ePrism compensation application focuses on market pricing of positions, surveys, analytics, pay structures and supporting the salary planning process. Hundreds of customers commit their compensation benchmarking and salary planning activities to ePrism. While robust, the application is ready for a new look and feel so it can join the era of Web-based applications. 

        Mercer is introducing a new application called Mercer WIN that uses current technology to provide a simpler user experience for accessing and searching market data for comparison and review. It includes more than 400 surveys of data. It makes it easy to compare a company’s jobs and pay with that of others in the industry. Mercer can help do the comparisons and search on them geographically. Planned enhancements to the application include direct methods to manage market libraries, employees and jobs from within the application. With Mercer WIN, companies can add incremental value throughout a year to hiring and succession efforts or exception reviews. 

        Organizations that want to optimize their compensation management processes and ensure effective design and strategy of them through benchmarking and aligning salary structures should look at Mercer WIN. Our total compensation management benchmark research found that for 24 percent of organizations it is critical to integrate salary benchmarking with compensation processes. That percentage also reveals that many organizations have not implemented salary benchmarking, but people in management ranked it one of the top five capabilities needed; 75 percent of organizations ranked it important or very important. Mercer WIN can be used not just as part of an annual review process but for any hiring or promotion event, which could happen at any time.  

        I was impressed with the new application and Mercer’s roadmap, but I would like to see this company work more closely with compensation management application providers such as those that we evaluated and ranked in our Value Index for Total Compensation Management. Mercer is one of the key and long-standing provider in salary and compensation benchmarking, and its contributions should be considered as part of any talent management and total compensation management effort. 


        Mark Smith – CEO & Chief Research Officer


        Mark Smith
        Partner, Head of Software Research

        Mark Smith is the Partner, Head of Software Research at ISG and Ventana Research leading the global market agenda as a subject matter expert in digital business and enterprise software. Mark is a digital technology enthusiast using market research and insights to educate and inspire enterprises, software and service providers.


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