Why Do Benefit Planning - Know Your Options...

If your business requires more than yourself to take care of your clients than you may want to consider creating a "total compensation strategy".  This concept may create not only a bottom line savings, but a bigger client base, and give you, the owner, more free time. 

Your compensation package is made up of two parts, "salary" and "benefits".  Creating the right combination of parts (salary and benefits) is kind of like baking a cake.  It takes the right combination of ingredients, put in the correct order, baked at the correct temperature for the right amount of time, to create that perfect cake that people will return for time and time again.  Sometimes you get lucky the first time you bake your cake and it comes out perfectly.  Other times it may take a few tries to get it correct.  The same holds true with a compensation package. You have to put the ingredients (salary and benefits) in "your" compensation package in the right amount, the right order and available at the right times in order to attract and retain the best employees, in order to create the business you want.

Consider these points when creating your compensation strategy:

»  Where are you in your business life cycle. Are you a start up trying to attract the best people, are you in a growth stage, are you in a wind down stage and ready to retire or think about retirement.

»  Is your product or service something that generates repeat business or is it more transactional in nature; people buy one time and usually don't return for several years or ever.

» Does your product or services require a lot of client hand holding, or are they able to purchase on their own.

»  What are your personal goals - what do you want your business to allow you to do. Retire early, work less, only work on certain projects and delegate the rest to every one else.

 

When looking at a compensation package think outside the box and consider all your options. 

Consider using a combination of soft and hard benefits.  Soft benefits are things that boost morale & productivity yet don't cost hard dollars.  Hard benefits are thinks like wages, insurance plans and vacation pay;  things that require an immediate cash outlay.  Or consider a middle of the road type of benefit like a one time bonus for meeting certain goals. Although it is a hard dollar benefit, it is not a regularly scheduled benefit, and only occurs when certain other conditions are met for the business.

A start  up business may only have enough cash to pay a salary, but it may be able to offer "soft benefits" like a flexible work schedule.  A mature business that is experiencing a slow down due to the economy may have to get creative and control cost by offering a basic health plan, adding soft benefits and creating an enhanced voluntary benefit program where the employee pays 100% of certain hard dollar benefits like a dental and life plan.

Unfortunately salary alone may not always be enough to attract and retain the best people.  Creating a long term successful business usually starts with creating or re-creating a strong base.  If your business requires more than yourself to succeed then consider your people as the base of your business.

Have a Question? Feel free to call us at 405. 720.0333

" I once heard profit is the applause you get for taking care of customers and your people".

Ken Blanchard
(1939,  American author and management expert)