Compensation as a Strategic Business Partner

Now more than in decades past, compensation professionals possess the opportunity to advance to the upper levels of a company’s management structure. We might see titles such as director of compensation or vice president of compensation. High-ranking compensation professionals understand the company’s competitive strategy and contribute to the HR and compensation strategies that support it. In fact, at all levels in the company, compensation professionals help shape competitive business strategy and consider the human capital of current employees and likely recruits. For example, if a company is embracing new technology for which employees have not yet had the opportunity to master, compensation professionals place a high importance on person-focused pay systems and extensive training, which are defined in Chapter 1 of your textbook. AT&T is an example of a company with a workforce facing the challenges of skills obsolescence. For decades, AT&T offered landline service and employed telephone-line workers who could install and repair wires on telephone poles. Telecommunications has evolved from landline service (though it is not yet extinct) to communications based on the use of cellular and fiber-optic technology. Most of the line workers' skills are rapidly becoming obsolete. AT&T faces the dilemma of whether to train its experienced workforce or replace them with others who are more well versed in the new technology.