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How toreadthis reportMethodologyPayscale’s 2024 Compensation Best Practices survey gathered 5,735responses from November–December 2023 with a completion rateof 55 percent. In this report, Payscale analyzes the differentiatorsbetween responses from top performers and non-top performers whenit comes to compensation management best practices.Top performers are defined as organizations who self-report that theyexceeded their revenue targets in 2023, while non-top performersmissed their revenue goals. Here, we examine responses to surveyquestions from the full Compensation Best Practices Report (over100 questions) and provide insights only on those showing the widestdifference between top performers and non-top performers. Twenty-one percent of respondents overall are top performers.Analysis is further segmented by size, with “smaller orgs” (3,069responses) denoting organizations with fewer than 750 employeesand “larger orgs” (2,101 responses) denoting organizations with morethan 750 employees. We look at both top-performing and non-topperforming differentiators by organization size.See Payscale’s2024 Compensation BestPractices Reportfor more insights. SummaryAccording to our survey, about a fifth of organizations exceeded theirrevenue targets in 2023, despite challenging economic conditions. Withpayroll making up the largest cost of many organizations, emulating thebest practices of top performers can help you maximize ROI on yourcompensation strategy and gain a competitive edge. So what do topperformers do differently?Payscale finds that being proactive, transparent, and communicativeabout pay are leading factors in what distinguish top performersfrom non-top performers. This isn’t limited to compliance with therequirements of pay transparency legislation. It extends to havingalways-accessible pay communications, breaking down the factorsthat go into pay increases, and issuing total rewards statements (TRS).These are made possible through higher investments in compensationtools and activities, including diverse and up-to-date salary datasources, compensation technology, and strategy — all for the purposeof making sure employees know the “what” and “why” behind their pay.The best news? Being a large organization with deep pockets is not aprerequisite for implementing compensation best practices for a returnon investment in HR and talent strategy. Top performers are foundequally in both smaller and larger organizations.In other words, you can do this! payscale.com3 How will HR prioritize investment in these areas of yourorganization in 2024 compared to previous years?Top performersNon-top performersBenefitsModernizing HR softwareRecruitingCompensation activitiesWorkplace policiesJob description managementWorkplace environmentUpskilling, reskilling, ormanaging a skills-based workforceWorkforce planningESGFostering company cultureEmployee and labor relationsCareer pathingLearning and developmentRetentionPerformance managementEngagement35%19%22%32%29%20%21%21%30%34%31%35%29%20%34%17%11%18%23%23%29%15%34%25%32%28%13%14%11%29% Top performers are more likely toprioritize investment in HR, includingcompensation activities andmodernizing HR software.Let’s start with the obvious: Top-performing organizationsinvest more in their people. While the order ofprioritization varies year over year according to thelabor economy and market dynamics, top performersinvest more in every area of HR compared to non-topperformers, even in a slow economy.While the biggest differentiator in 2024 is benefits(showing a 16 percent difference), modernizing HRsoftware and compensation activities come in at a10 percent difference and a 9 percent differencerespectively. Recruiting and workplace policies arealso differentiating for top performers compared tonon-top performers at 9 percent, with job descriptionmanagement following at 8 percent. These activities likelyreceive higher investment because they translate to ROIin terms of talent attraction and business growth.Investmentin HR BenefitsJob description managmentRecruitingWorkplace policiesUpskilling, reskilling, ormanaging a skills-basedworkforceModernizing HR softwareFostering company cultureCompensation activitiesCareer pathingRetentionTop performers18%10%8%20%How will HR prioritize investment in these areas of your organization in 2024 compared to previous years?Smaller orgs (<750 employees)Top 10 shownLarger orgs (>750 employees)Top 10 shownInvestment in HR priorities segmented by organization sizeWhen we segment the data by organization size, we see some differences in what top-performing smaller organizations are doing comparedto larger ones. Notably, larger-sized organizations see stronger differentiation in job description management, recruiting, upskilling, reskilling,and skills-based workforce, workplace policies, fostering company culture, career pathing, and retention, while smaller-sized organizationsdo not see strong differentiation in these areas but do for workforce pla