The merger of two competitors of roughly the same size created one of the largest IT service providers in Germany. It had already become clear during the merger talks that remuneration, fringe benefits and employment conditions were very different in some cases and needed to be harmonized. This presented an opportunity to implement a future- and market-oriented approach that took into account the changing requirements of the labour market and employees.
Designing a blueprint for a total remuneration solution for the merged companies
As a consultant for a large consulting firm, the current interim manager was tasked with putting the historically evolved "worlds" to the test and designing a blueprint for a common, modern total remuneration solution. Based on the initial situation identified in the HR due diligence, the interim manager defined a project plan with the following milestones:
- Market comparison of all remuneration and employment conditions, taking into account labour market trends
- Harmonization of job structures in the pay scale and in the non-pay scale
- Development of the "total remuneration" blueprint
- Presentation and coordination of the blueprint at events and in focus groups at all locations
- Concretization of the blueprint for the presentation and kick-off of the in-house wage negotiations
- off the in-house wage negotiations
Benchmarks for the realignment of total remuneration collected and agreed
At the start of the extensive benchmarking process, the interim manager worked with the company to develop principles for design and communication, which were then agreed with the pay commission. In the next step, he used the results of the HR due diligence and the requirements of the business units to compare remuneration systems, fringe benefits and employment conditions with general and IT-specific trends and develop recommendations for the future. He specified the alternative models on the basis of trend studies on the world of work 4.0 and coordinated them in briefing workshops.
In parallel, he harmonized the job structures in order to better compare internal and external remuneration levels, for example, and to define the level of remuneration and fringe benefits more precisely. The results were compiled in a blueprint and agreed with stakeholders and focus groups. Based on the feedback, the interim manager specified the blueprint.
In addition, he determined the costs for the previous programs as a framework for the new total remuneration. This made it possible to compare the costs of previous programs and new model options. With the results, he detailed the blueprint. The in-house tariff negotiations were able to begin.
Future-proof total remuneration plan forms the basis for collective redesign
The biggest challenge in this mandate was to define the design options that would form a solid basis for business development and in-house collective bargaining. In order to achieve consistency as early as possible, the interim manager specifically involved the stakeholders in management and the collective bargaining committee in the development process.
Briefing workshops with marketplaces on individual topics provided a successful platform for exchange. The broad involvement of employees through focus groups at the locations and the communication that accompanied the project were also crucial to its success. The result was a future-proof and competitive overall remuneration plan with the following key points:
- Modern remuneration instruments, fringe benefits and employment conditions promote employee motivation as well as their recruitment and retention.
- The design options are geared towards results and the future.
- The existing cost framework forms the basis for the collective redesign.
The design options could now be used as key anchor points for the negotiations in order to find viable solutions.
