Balancing Employee Salary
By: Tina Samuels
Everyone in business world knows: money matters.
This is particularly true when you are running a business. You need to pay bills, keep employees happy with their salary, and still manage to make a profit.
The answer to keeping a company running doesn't involve paying the least amount possible to employees. Keeping pay rates below the competition is one way to ruin your own company. You'll need to offer pay that is high enough to nab you high quality employees, but not so high that you can't keep things afloat.
What Should You Be Paying?
Figure out your pay practices before interviewing applicants. If you don't know what you should be offering or how to counter pay requests from applicants, you won't be able to make the right decision. Review the previous payment practices of your company.
You can base some of your decision on past decisions, but keep in mind your company's budget.
Can you afford to pay more without affecting customer, product, or total profits? Would an increase in pay keep better employees which in turn can improve business? All of these questions should be figured into your decision on what you should be paying.
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What Are Competitors Paying?
It can be hard to find out exactly what your competition is paying their employees.
If a company is paying lower rates, they don't want to be outpaid by the competition. There are websites, such as Payscale.com, that can give you an idea of what is being paid to employees in your industry.
When advertising the position you are wishing to fill, define the responsibilities of the position clearly. If you are seeking an entry level applicant, say so. Understand that highly experienced and qualified applicants will demand a higher salary.
To keep everyone on the same page, set your pay scale.
Communicate to applicants clearly what this scale is and what you base it on. Entry level applicants will start at the low end, while experienced applicants may receive the top end of the scale. You must consider future events in your scale, such as raises for cost of living, performance, and experience.
If you are paying a lower rate than competitors, think about sweetening the deal for applicants.
Add more benefits or job perks in order to lure quality applicants. While a high pay is nice, a full benefits package and perks such as casual clothing days, days to leave early, and options for partial telecommuting can make your company more appealing.
It can cost you substantially less to offer in house perks or great benefits when trying to beat the competition. Most perks are known as 'quality of life' perks.
These can include flex time, sweet vacation or personal day packages, discounts at local eateries and business, or almost anything that can improve the quality of life for employees.
Budgeting for the future, considering you competition, and adding perks is a sure way to ensure you will tempt the best quality applicants to your company.
About the Author: Tina Samuels writes on mobile payments, social media, and small business topics.
Six issues at the top of tax and finance leaders’ agenda
New Deloitte research reveals that tax leaders are under increasing pressure to add strategic value as companies accelerate business model transformation, from undergoing digital transformations to rethinking their supply chains or investing in green initiatives.
According to Phil Mills, Deloitte Global Tax & Legal Leader, to “truly deliver value to the business, the tax function needs to rethink its resourcing model and transform its technology infrastructure to create capacity and control costs”.
And the good news, according to Mills, is that tax and business leaders have more options at their disposal to achieve this.
Reflecting the insights of global tax and finance executives at global companies, Deloitte’s Tax Operations in Focus study reveals the six issues at the top of tax and finance leaders’ agenda.
Trend 1: Businesses seek more strategic counsel from tax
Companies are being pushed to develop new digital products and distribution channels and accelerate sustainable transformation and this is taking them into uncharted tax territory. Tax leaders say their teams must have the resources and skills to give deeper advisory support on digital business models (65%), supply chain restructuring (49%) and sustainability (48%) over the next two years. This means redrawing the boundaries of what tax professionals focus on, and accelerating adoption of advanced technologies and lower-cost resourcing models to meet compliance requirements and free up time.
According to Joanne Walker, Group Tax Director, BT Group PLC, "There’s still a heavy compliance load today, but the vision for the future would be that much of that falls away, and tax people become subject matter experts who help program the machine, ensure quality control, and redirect their time to advisory activity.”
Trend 2: Tipping point for resourcing models
Business partnering demands in the tax department are on the rise, but 93% of tax leaders say their department’s budget is remaining flat or falling. To ensure that the tax function can redefine itself as a strategic function at the pace that is required, leaders are choosing to move increasing amounts of compliance and reporting to a combination of shared service centers, finance departments, and outsourcing providers that have invested in best-in-class technology.
Trend 3: Digital tax administration is moving faster than expected
in addition to the rising focus of the corporate tax department partnering with their business counterparts, transformative changes to the way companies share tax information with revenue authorities is also creating an imperative to modernize operations at a faster pace. Nine in 10 (92%) respondents say that shifting revenue authority demands on digital tax administration will have a moderate or high impact on tax operations and resources over the next five years—and several heads of tax said the trend is moving faster than expected.
"It’s really stepped up in the last couple of years," says Anna Elphick, VP Tax, Unilever. "Tax authorities don't just want a faster turnaround for compliance but access into a company’s systems. It's not unreasonable to think that in a much shorter time than we expect, compliance will be about companies reviewing a return that's been drafted by the tax authorities."
Trend 4: Data simplification and lower-cost resourcing are top priorities
Tax leaders said that simplifying data management (53%) and moving to lower-cost resourcing models (51%) must be prioritized if tax is to become more proactive at delivering strategic insights to the business. Many tax teams are ensuring that they have a seat at the table as ERP systems are overhauled, which is paying dividends: 56% of those that have introduced NextGen ERP systems are now highly effective at supporting the business with scenario-modeling insights. Only 35% of those with moderate to low use of NextGen ERP systems said the same.
At Stryker, “we automated the source P&L process for transfer pricing which took a huge burden off of the divisions," says David Furgason, Vice President Tax. "Then we created a transfer price database to deposit and retrieve data so we have limited impact on the divisions. We are moving to a single ERP platform which will help us make take the next step with robotics.”
Trend 5: Skillsets are shifting
Embedding a new data infrastructure and redesigning processes are critical for the future tax vision. Tax leaders are aligned — data skills (45%) and technology process experience (43%) are ‘must have’ skills in a tax department of the future, but more traditional tax specialist knowledge also remains key (40%). The trick to success will be in tax leaders facilitating the way these professionals, with their different backgrounds, can work together collectively to unlock lasting value.
Take Infineon Technologies, which formed a VAT technology and governance group "that has the right knowledge about how to change the system to ensure it generates the right reports", according to Matthias Schubert, Global Head of Tax. "Involving them early was key as we took a greenfield approach, so we could think about what the optimal processes would look like and how more intelligent systems could make an impact
Trend 6: 2020 brought productivity improvements
Improved productivity (50%) and accelerating shifts to remote working (48%) were cited as the biggest operational benefits to emerge from COVID-19-driven disruption. But, as 78% of leaders now plan to embed either hybrid or fully remote models in the tax function long term, 34% say maintaining productivity benefits is a top concern. And, as leaders think about building their talent pipeline and strengthening advisory skill sets, 47% say they must prioritize new approaches to talent recognition and career development over the next two years, while 36% say new processes for involving tax in business strategy decisions must be established.