Compensation and productivity are the backbones of any successful business. The amount of output per hour for each of your employees measures their efficiency and productivity. Compensation is the cost to you for that labor. It’s the base pay and salary, plus any benefits that your employees earn by working for you. But how do you ensure your compensation is properly aligned with productivity? We can help.
Compensation and productivity are a simple concept – a person’s pay should reflect the amount of work and effort they put into doing a job. That isn’t always the case. When there is a disparity between effort and reward, it’s called the productivity-compensation gap. When productivity exceeds compensation, there needs to be a change in pay for the employee. But when the opposite occurs and compensation is greater than productivity, your business suffers.
There are many things that can impact how compensation and productivity are either in sync or are divergent. Every industry can experience it, and there are some common denominators. Changes in process and procedure, new technology, change in leadership, a shift in company culture, employee satisfaction, access to training, communication, collaboration, and team dynamics are just a few. All of these things can negatively or positively impact productivity.
If productivity drops, what should you do? Do you lay people off? Do you incent them with higher compensation? Do you change your business strategy? It could be none of those things, all of those things, or a combination of those ideas plus other programs that will bring your pay and productivity back in line.
At PCG, our programs are designed to be measurable and predictable. We’ll create calculated goals for your entire management team as well as your sales and support staff. We strive to build plans that include compensation, productivity, and commission programs. Every program we build is customized to your company needs depending on individual roles and production. We want you to be able to pay well for those that are producing well.
Our primary strategy is built around prosperous wages, measurable goals, and predictable outcomes. Buy-in from your staff is critical, and we will work to make sure everyone is on board with the new process by creating targeted objectives that are visible and reachable. We believe that people work best when they know what the expectations are and what the rewards are when they meet them.
How do compensation and productivity programs impact your business? One word: morale. The number one impact of changes to compensation and productivity expectations is employee morale. Engaging the management team to work better with the sales and support teams will create an environment ripe for better, happier workers.
When employees know what’s expected of them, they tend to rise to the occasion. They work harder, find more satisfaction in their work, and feel more loyalty to the company. Retention goes up, sales go up, and productivity goes up. When you can justify your compensation packages with increased sales and profits, improved employee satisfaction, and greater customer service, we know we’ve done our job getting your packages and programs aligned.
Running your pawn business is your full-time job. You don’t have time to spend on statistics and programs to retain your talent, or time to create customized compensation plans. That’s where our experienced team can help. Our compensation and productivity systems will create smart, profitable compensation plans for your shop or shops. You don’t need to understand industry trends and strategies because we’ve got you covered.
Let the team at Pawnshop Consulting Group optimize your workforce, allowing you to have the right number of employees doing the right jobs for the right pay. Connect with us online now to get started.