Global Job and Compensation surveys are carried out by consultancy firms across the world and publish reports defining the standardized Industry Jobs and aligned with local country based compensation matrix. These surveys consider parameters such as living expenses in a certain geography (Country, area, city), Inflation, Industry segmentation etc.

One of the key outcomes of such survey data is Compensation Reference Points that guide the employee compensation per job. There are multiple ways of capturing and measuring Reference points. Some companies use 3 point reference as in the case of Hogwarts Retail and other may use 2 point, or 4 point reference scale.

What are compensation reference points?

In simple terms for the jobs at Hogwarts Retail in The Netherlands:

  • Front line cashier (MIN:2000 MID:2500 MAX:3000)
  • Cash supervisor (MIN:3000 MID:3500 MAX:4000)
  • Assistant store manager (MIN:4000 MID:4500 MAX:5000)
  • Store manager (MIN:5000 MID:5500 MAX:6000)

What we mean by the above matrix is we are using 3 point reference per Job Compensation Level: MINIMUM; MIDPOINT and MAXIMUM

Let’s say if Ronald is working as a Front line cashier: Ideally he would start at the Minimum salary of 2000 Euros and grow towards the maximum of 3000 Euros based on his experience and performance and get promoted to Cash supervisor and move to the next compensation level.

Configure Reference points on Dynamics 365 Human Resources

Step 1: Navigate to compensation management workspace and select Reference point setups
Step 2: Add a New reference point setup and fill the details as shown in the screenshot below

That’s it, we have a defined a 3 point reference setup and can be used in the compensation matrix😀

Overview of blogposts related to compensation management series:

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