Streamlining Compensation Management For Your Company

HR Management Software Dubai

April 7, 2022

Having a healthy compensation management system is important in an organization for two main reasons. One is to improve existing employee engagement and the second is to facilitate the easy attraction of top talent. Additionally, it is also believed that salary gripes are one of the common reasons why employees quit. Especially with the advancement of cloud-based HR and similar technologies, today’s employee landscape has changed drastically demanding more accurate and real-time HR processes, including compensation management. This article will focus on how you can effectively streamline compensation management for your company. 

Accurate Goal Setting 

One of the most crucial steps in streamlining compensation management is accurate goal setting. This is where you must first identify the compensation goals you’re streamlining for. Do you have a compensation strategy that involves various payment factors? How many employees are on your payroll  and what are their salary ranges? How do they get paid? Are there any processing delays that should be accounted for? If so how? 

Answering these questions will help you create well-defined compensation management goals that will allow you to narrow down which part of the payroll process needs prioritization . This means that you will spend less time formulating strategies that yield poor results and more time refining options that practically work towards effectively optimizing compensation management. 

Define Limits

As with any HR function, even an effective compensation management system knows its limits, especially when it comes to budget. So make sure you’re defining your compensation management limits with a properly developed budget. Work closely with the finance and HR department to find out how much budget can be allocated to the company’s compensation plans and how it’s divided among different types of employees. 

By knowing this, you can have a more defined incentive and compensation scheme. Having consistent compensation structures also allows employees to set realistic expectations and avoid biased situations. 


It’s well known that automation serves as the key to many HR and payroll solutions in today’s business landscape, and compensation management is no exception. Manually editing spreadsheets and managing payroll may be viable for smaller businesses, but even then they are prone to discrepancies caused by human errors and are also subject to delays due to overwhelming and tedious processes that drain productivity.

Automating compensation processes using an appropriate HR management software allows employees to be paid on time and accurately with minimal to no errors. It also allows companies to make adjustments at a much faster pace. 

In countries like the UAE, the“Wage Protection System” is a mandatory legal requirement for businesses registered under the MoHRE. It is an initiative to enable a dynamic economy that guarantees the timely and complete payment of the agreed-upon wages to safeguard the interests of the workers and attract talents across the globe. If wages are delayed, it will subject the company to predefined fines, depending on the number of days delayed. Streamlining compensation management through automation will help companies to overcome this legal risk successfully.

Outsource The Process

If your company needs optimized compensation management but you lack the time, resources, or expertise to do it effectively, then the best option is to outsource compensation management to third-party service providers. These companies are equipped with all the necessary resources and talent to ensure the best possible methods to streamline compensation management for your company. These service providers can also provide proper training to your HR managers to adapt to the recent compensation management trends much quicker than if they did it on their own.