Companies around the world are navigating the Great Resignation and war for talent. The costs of recruitment and training new joiners are piling up as companies wade through stacks of unqualified candidates and soaring job openings. Mid-sized companies are feeling the strain more than most.
People are resigning in droves in search of more professional development opportunities, flexibility and work-life balance, and better compensation. But that’s not all. People want to feel valued by their companies and fulfilled by their work. High paychecks and top-notch benefits alone aren’t enough to motivate professionals to stick around anymore.
Mid-sized companies are often hard-pressed to answer these demands. High-growth scale-ups can’t offer every new joiner a career-defining growth opportunity like early-stage startups or mind-blowing benefits packages like large enterprises.
In our latest guide, How to attract and retain top talent using a full-stack compensation strategy, we partnered with leading equity management platform, Ledgy, for a deep-dive discussion into how companies can build competitive compensation and equity sharing into people-centric cultures to set themselves apart from the competition.
It’s time to get creative about compensation
In their State of Equity 2022 report, Ledgy found that 72.3 percent of professionals with share options in their company reported that their options make “at least some difference to their motivation” and engagement. For mid-size companies that may not be able to give their people significant salary increases, increasing their equity stakes can make all the difference.
Equity sharing gives people ownership of the business and a direct stake in the company’s success. It can be the difference between a position being “just a job” and a position being something people care about, value, and put their hearts into. Ultimately, it can motivate people to stick with your company and attract new talent away from competitors who don’t offer equity in their benefits packages.
It means making compensation a cornerstone of your people-centric company culture. When companies give people real ownership, they feel valued, properly compensated for their work, and personally motivated to engage and give their all to the job. But, what does offering class-A compensation packages mean in practical terms?
CFOs can incorporate people-focused compensation plans into their wider financial strategy
On the ground, CFOs and HR leaders need to find ways to make their people happy while keeping their budgets in the black. This puts mid-sized companies in a tough spot: To hire the best people, companies often need to recruit people at higher salaries than valuable company veterans. Realistically, it won’t take long for those veterans to realize what’s happening and jump ship.
But, companies can’t increase salaries for everyone every month or two. There’s a delicate balancing act between salary-at-hire and salary increases and between the cost of losing valuable people and training new joiners from the ground up.
Progressive companies are already ahead of the game
In our latest research, we asked CFOs about their relationship with their HR teams. Over half of respondents consider aligning the HR function to the organization’s goals and overall strategy a key business objective.
Over one-third of respondents said they’re focused on fostering company culture and meeting the company’s DE&I goals. At the same time, just under a quarter of CFOs reported that they’re also focused on getting feedback from their people so they can act on their needs to increase retention rates.
Investing in inclusive, people-first benefits and compensation packages puts companies miles ahead of the competition. When people see companies proactively responding to their feedback, they’re more likely to stay and help recruit other top-notch professionals.
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The bottom line: Finance and HR teams must work together to create the best people strategy
Placing compensation and people at the center of your company culture can make all the difference. Companies need to be progressive and proactive about the compensation and benefits package they offer their people and how different teams can work together to deliver value. Equity sharing can be the secret sauce mid-sized companies need to achieve their talent acquisition and retention goals.
To read more about building equity sharing and progressive compensation packages into your company culture, read the full guide: How to attract and retain top talent using a full-stack compensation strategy.