Startups often begin with a flat organizational structure and a small team, which can be effective in the early stages of the business. However, as the company grows and expands, not having an organizational structure and compensation alignment can make it difficult to scale effectively due to lack of clarity in roles and inconsistent decision making when incentivizes and rewarding employees for their contributions.
The company sets a goal to complete a compensation analysis against market data and correct any misalignments around leveling, responsibilities, and protected classes. This was done in order to ensure fair and equitable pay across the organization and create a structure that would support the company's growth.
The analysis was conducted in partnership with stakeholders and the results were shared with senior leadership and board members for review and approval.
Results & Impact
Based on the analysis, it was found that there were several areas where pay was not aligned with market rates or with job responsibilities. In some cases, there were also discrepancies in pay based on protected classes, which needed to be addressed. To correct these issues, we developed a plan to adjust salaries and create a more appropriate salary range for each job level.
In addition to the compensation analysis, the company also developed a career pathing guideline that would apply to all functions within the organization. This guideline helped employees understand what skills and experience were necessary to advance within their careers and provided clear expectations for promotion and compensation.