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the JESAP™ system
Overview | Consistent Pay Structure | Proven Methodology | Equitable Pay | Profit Maximization | Defensibility | Planning | Affordable Efficiency
The Nature Of Business Expenditures
All expenses are investments upon which shareholders expect a return. Salaries are no different; they represent an investment. If your shareholders are not getting the maximum return out of that investment, they will simply move to a different form of investment for a better return.
Overpaying Employees
Overpaying employees fails to maximize the profitability of your salary investment. A company that is too generous with salary dollars will potentially return profits to employees instead of the shareholders.
Underpaying Employees
Underpaying employees yields exactly the same error in the reverse direction. In the opposite extreme, by failing to compensate employees fairly and competitively it is possible for a company to lose profits.
The Balance
It is paramount for a company to arrive at an optimal level of salaries to maximize profit dollars. While paying more than the magic number loses money, paying less than the magic number also loses money.
Market Data Alone Doesn't Add Up
Market data alone is inadequate for several reasons:
- First, you seldom get market comparisons for all employees. That leaves you to guess the salary amounts for remaining jobs.
- Second, market data can be misleading. Two jobs by the same title but at two separate companies may have very different requirements.
- Third, market data can exhibit conflicting information. How do you know which one is right?
Using JESAP, your internal payline will point out when your market data appears to be out of line with the value of the job in your organization.
The Magic Number
JESAP helps you find that magic number for maximizing profits by giving you a comprehensive framework in which to view each employee in the organization. With each job rated, you know exactly how much a single job is worth to your company.
Once you adjust your internal payline to properly place your compensation plan with respect to the market, you are at the profit-maximizing level of salaries. As the market moves, you adjust the entire forest instead of adjusting individual trees. You always know your appropriate level of salaries, and you always have an answer when someone asks why you are paying at the selected level of salaries.
Learn about Defensibility....
What is a job worth? Point and click your way to a competitive compensation structure and maximized profits for your company. Contact DB Squared today at 479.587.0151 or
for a free, no-obligation quote or to find a free seminar near you.
Overview | Consistent Pay Structure | Proven Methodology | Equitable Pay | Profit Maximization | Defensibility | Planning | Affordable Efficiency
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