SRD Consulting Services, LLC
Compensation Planning on a Shoestring
“When Excel Spreadsheets Are The Only Option”
Steven R. Davis, Ph.D., CCP
Steve is a Certified Compensation Professional with over 37 years’ experience as a human resources professional.
He has expertise in global compensation program administration (including executive compensation, long/shortterm incentives, job evaluation and market research), employee communications, HRIS coordination, and project
management. Steve has led compensation projects in the Americas, Europe, and the Asia-Pacific region. He also
has extensive experience with pay equity analyses and implementing strategies to leverage diversity and change
management initiatives. Steve has also had leadership roles in training and organization development, labor
relations, salaried administration and human resource planning. He has also consulted and facilitated acquisitions,
mergers, and joint venture activities.
Steve advises a wide variety of clients, among them both publicly-traded and closely-held businesses, on their
compensation and change management needs. Prior to entering the consulting profession, Steve was a Senior
Consultant on the Global Compensation Staff of General Motors Corporation.
Steve earned a doctorate degree from Wayne State University. He also received M.S. and B.S. degrees from Ball
State University.
Develop an awareness of techniques that can be
used with Excel workbooks to:
• Create and distribute compensation planning worksheets
• Efficiently merge and re-publish planning worksheets for
roll-up approvals
• Analyze compensation data and create meaningful
reports
• Generate individual employee compensation statements
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Fund determination & allocation (e.g., mid-point
administration, budget-based, performance-driven, etc.)
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Identification of planning groups
Identification of compensation planners/approvers
Define “rollup” & approval timing
Planning in local currency versus % change versus
% of funded amount
Rounding rules, “hard” versus “soft” edits
Compensation plan analytics and reports
Compensation budgets can
consist of multiple components…
High Performer
Supplemental
Market Adjustment
Basic
3%
1%
.5%
.5%
Fund allocation for initial
employee recommendations…
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Approved Fund or Budget
Salary Intervals
Performance Rating
Strategic Allocation (e.g., Modeling)
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Performance
Percent of Market Rate
Pay Equity
Retention
Fund Allocation
Salary Intervals
Fund Allocation
Performance Rating
Performance Rating / Compa Ratio
Compensation
Fund
“Strategic” Fund
Allocation
Base Increase
Fund
Market
Correction Fund
Eligible
Population
Base Inc Recommendation Percent
Illustrative
Low
Low
Market Rate %
(Salary Range)
High
“Strategic” Fund Allocation
Fund Allocation
A PowerPoint voice-over presentation that
explains how to use the calculator and a sample
Fund Allocation Calculator can be found on the
Resources page of the following website.
www.srdconsultingservices.com
Data sources for compensation
planning…
HR
Information
Systems
Global
Directory
Employee Data:
Organizational Data:
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Name
Level/Grade
Salary
Hire Date
Prior Comp Treatment
Education
Performance Rating
Etc.
Name
Department
Location
Phone Number
e-Mail Address
Supervisor
Direct Reports
Etc.
Planning Hierarchy…
Top of Hierarchy
3rd Planning Cycle
Summary Worksheet
Tactical Decisions
• Identification of planners &
planning groups
• Number of planning cycles
(e.g., roll-ups)
• Timeline for each step of
the planning process.
• Process for matrix
reporting relationships
2nd Planning Cycle
1st Planning Cycle
Initial Employee Recommendations
Because planning worksheets may contain employees
with salaries in different currencies and size of the budget
can vary by country, planning as a percent of the budget
can be helpful.
A “PAR” value of 100% can be used to standardize the
initial employee recommendation to represent the
country’s approved budget.
Initial Employee Recommendations
By adjusting the PAR %, Leaders can focus on
the relative contribution of each employee...
5% Merit Rec x 85% PAR = 4.3% Inc.
and the recommended merit increase percent is
adjusted accordingly.
Analytics
“What gets measured gets done.”
“Not everything that counts can be counted, and
not everything that can be counted counts.”
“Without a standard, there is no logical basis for
making a decision or taking action,”
Peter Drucker, Tom Peters, Edwards Deming, Lord Kelvin, Joseph Juran and others..
Excel Data Analysis Tools
“Pivot Table”
Here are some example uses of pivot tables:
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Summarizing data like finding the average sales for each region for each product
from a product sales data table.
Listing unique values in any column of a table
Creating a pivot report with sub-totals and custom formats
Making a dynamic pivot chart
Filtering, sorting, drilling-down data in the reports without writing one formula or
macro.
Transposing data – i.e. moving rows to columns or columns to rows.
Linking data sources outside excel and be able to make pivot reports out of such
data.
Below are Youtube tutorial videos on how to create a Pivot Table:
http://www.youtube.com/watch?v=0ZyGcSdsaNo
http://www.youtube.com/watch?v=eax0HTsieZA
File Distribution
• e-Mail
• Shared Drives
• The “Cloud”
• Custom Websites
 Intranet
 Internet
Sharepoint Office 365
Communicating Salary Changes
According to a study conducted by the human
resources consulting firm, Watson Wyatt
Worldwide, organizations that communicated most
effectively with employees experienced a return to
shareholders of 26%.
Employers who attempt to "cut corners" with
regard to pay decisions generally are rewarded
with a disgruntled workforce. Joan M. Rennekamp, SPHR
Compensation Statement
Compensation Statement
“Group” Compensation Statements
• Contains a compensation statement for each
employee for which the Leader has responsibility for
communicating the compensation change.
• Additionally, contains “Talking Points” and a
summary worksheet detailing all compensation
information in a single worksheet.
• Individual compensation statements can be printed
or saved to a separate file.
• Compensation statement template can be translated
to local language.
“Macros”
• A macro is a series of commands and functions that
are stored in a Microsoft Visual Basic module and
can be run whenever you need to perform the task.
For example, if you often enter long text strings in
cells, you can create a macro to format those cells so
that the text wraps.
Developing Excel Skills
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Search Microsoft HELP
Search the Internet for Solutions
Call a Friend…
Excel Message Board
http://www.mrexcel.com/
“Mr. Excel”
Bill Jelen
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Questions