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In an evolving talent market, compensation isn’t just about salaries, it’s a reflection of culture, values, and long-term strategy. How can organizations build compensation models that are fair, transparent, and built to scale? It starts with having the right foundation.
In the tenth episode of the HR Game Changers series, a panel of HR leaders came together to share how they’re building compensation models that align with business goals, drive retention, and foster trust.
Hosted by Janelle Henry, the conversation explored everything from salary banding and job architecture to compensation philosophy, pay equity, and transparency in a remote-first world.
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Speakers
Janelle Henry: VP of People at RadAI (moderator)
Laura Thiele: Chief People Officer at Optimizely
Janice Schwartz: VP of People at Placer.ai
Evan Salisbury: VP of Total Rewards and People Operations at Ancestry
Key Takeaways:
Start with structure: A clear compensation framework, job architecture, and defined salary bands are essential for success.
Trust is foundational: You can’t build a strong compensation model without trust across leadership and employees.
Transparency comes second: Build infrastructure before rolling out pay transparency company-wide.
Use data to guide decisions: Leverage benchmarks and internal analytics to ensure fairness and alignment.
Philosophy drives strategy: Your compensation philosophy should align with your business mission, values, and growth plans.
Why Building a Compensation Model Is More Than a Spreadsheet
A thoughtful compensation model sends a powerful message—it reinforces your company’s mission, supports retention, and helps scale your culture. Without a clear model, inconsistencies creep in, and trust erodes.
“Pay is not just numbers on a spreadsheet. It’s a message about who we are, what we value, and what we want people to feel about their work.”
—Janelle Henry, VP of People @ RadAI
Step One: Build the Foundation
When it comes to building a compensation model, structure is everything. Laura Thiele underscored the importance of establishing a strong foundational framework that includes job architecture, career leveling, and clearly defined salary bands. These core components set the stage for both internal equity and external competitiveness.
Career Framework: Establish standardized internal levels for individual contributors and parallel tracks for managers, directors, and executives to ensure consistency across teams.
Job Architecture: Categorize roles by function (e.g., technical, corporate, customer-facing) and align each group with appropriate compensation ranges.
Job Profiles: To support transparency and development, define each role clearly, outlining key responsibilities, required skills, and potential career paths.
Together, these elements create a scalable structure that promotes fairness and allows organizations to effectively benchmark roles against market data.
Align Compensation with Company Philosophy and Values
Evan Salisbury emphasizes that your compensation model should embody your company’s core values and future growth ambitions. Whether your focus is on rewarding tenure, high performance, or maintaining market competitiveness, it’s essential to clearly define your compensation philosophy from the outset—and let it steer every decision.
“Build for the company you want to be in five years, not just who you are today.”
—Evan Salisbury, VP of Total Rewards and People Operations @ Ancestry
Prioritize alignment between your compensation strategy, business objectives, and organizational culture to create a sustainable and motivating framework.
Transparency Starts with Trust
While pay transparency is gaining momentum, panelists caution against rushing into it prematurely. Before sharing salary bands publicly, it’s essential to have a solid infrastructure in place.
Key prerequisites include:
Clearly defined salary ranges and levels
Managers trained to handle compensation conversations
An internal philosophy that explains and justifies pay variances
“Transparency is about the fundamentals; without them, you can’t have trust.”
—Laura Thiele, Chief People Officer @ Optimizely
Evan Salisbury adds that publishing your compensation philosophy—clarifying what you value and how decisions are made—is a powerful first step toward transparency. Even before revealing exact salary ranges, sharing your rationale builds credibility and trust.
Manager Enablement Is Essential
One of the most common gaps in organizations is that managers often don’t feel equipped to discuss compensation. Panelists urged HR teams to shift ownership of these conversations to managers.
“Managers need to own these conversations. It’s crucial for them to understand that compensation isn’t just an HR issue—it’s theirs too.”
—Janelle Henry, VP of People @ RadAI
Further, Janelle shared how RadAI addressed this challenge through dedicated manager training, resulting in an immediate and noticeable improvement in how compensation discussions are handled across the organization.
Handling Pay Inequities and Compression
A crucial aspect of building an effective compensation model is identifying and addressing existing pay disparities. Key recommendations include:
Correcting small gaps through off-cycle raises
Tackling larger gaps gradually with a phased approach
Reviewing performance, skill sets, and role expectations in conjunction with pay adjustments
Evan Salisbury recommends modeling both minimum-cost and full-compression correction plans to clearly understand your targets. Laura Thiele added that HR must advocate for fairness, using data to flag underpaid employees and making the case for budget reallocations.
Addressing Title Inflation and Legacy Issues
As organizations evolve, they frequently struggle with inflated titles and misaligned compensation. The key advice? Don’t attempt to fix everything retroactively. Focus instead on establishing a clear path forward.
“Compensation is an art, not a science—you need judgment, fairness, and the courage to make hard calls.”
—Laura Thiele, Chief People Officer @ Optimizely
Set clear title guidelines, enforce them consistently going forward, and document any exceptions thoughtfully.
“It’s about managing expectations—not taking things away, but aligning roles with reality.”
—Janice Schwartz, VP of People at Placer.ai
Final Advice for HR Leaders Building a Compensation Model
To wrap up the discussion, panelists shared their best advice:
“Alignment with leadership is crucial. It’s about building relationships and ensuring mutual understanding on compensation strategies.”
—Laura Thiele, Chief People Officer @ Optimizely
“Define your compensation goals. Communicate them. And be open to evolving as your company changes.”
—Janice Schwartz, VP of People at Placer.ai
“Come prepared—with data, ROI, and strategy. That’s how you earn trust and build a model that lasts.”
—Evan Salisbury, VP of Total Rewards and People Operations @ Ancestry
Final Thoughts
Building a thoughtful compensation model is one of the most powerful actions HR leaders can take to enhance employee engagement, promote organizational fairness, and drive long-term business success. With the right strategy, clear structure, and strong stakeholder alignment, your compensation program can transform from a source of confusion into a cornerstone of your company culture.
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