The connection between Oracle Cloud HCM’s Talent Management and Compensations modules streamlines the compensation process and aligns it with performance reviews.  Anastashia Alfred-Waller, Lead HCM Analyst at Baylor University recently delivered a presentation at Quest’s Cloud HCM Week on this connection. According to Alfred-Waller, Oracle’s various components and pieces work together seamlessly when you apply the necessary configuration changes and updates. She says it’s clearly designed to function this way. You’ll see why she thinks so in the examples displayed below of how Baylor University leverages Talent Management and Compensation for their employees.

Why Does Baylor Connect Talent Management and Compensation?

By connecting Oracle Talent Management with the Compensation Module, organizations can streamline their compensation processes and align compensation decisions with performance reviews. Performance ratings and assessments gathered within the Oracle Talent Management module can be seamlessly utilized in the Compensation Module.

Baylor University uses yearly performance scores and ratings to influence proposed merit targets and percentages for line managers in the merit cycle.

Key Benefits of Cross Module Impacts

There are several benefits of cross module impact. Below are some of the key benefits discovered by Baylor University throughout their experience of connecting Talent Management and Compensation:

• Holistic Talent Management — By leveraging cross-module impacts, organizations can have a holistic view of their talent management processes. This enables better decision-making regarding recruitment, performance management, learning, and succession planning.
• Enhanced Compensation Planning — Compensation decisions can be based on performance metrics, employee contributions, and market benchmarks, resulting in better employee satisfaction and retention.
• Efficient Workflows — With cross-module impacts, workflows can be streamlined and automated. In turn, this reduces administrative overhead and ensures timely and consistent processes.
• Data-Driven Insights — Analyzing data across talent management and compensation modules allows for identifying trends, forecasting talent needs, and making informed decisions about resource allocation and future strategies.
• Compliance and Transparency – Cross-module impacts can aid in ensuring compliance with company policies and regulatory requirements. Utilizing integrated data on performance, compensation, and training can help demonstrate fair practices and adherence to regulations during audits.

Performance Setup

The image above shows Baylor’s Staff Performance Template. Typically, there will be a list of the eligibility profiles associated with the specific area and an explanation of how the line manager and employee should engage with the performance doc. By utilizing the Talent Management performance documents, the employee will rate their own performance and engagement. The employee’s self-evaluation serves as a prompt for discussion with their line manager about performance. The scores can change over time. Data can be tracked throughout the process.

In the specific example above, there are no alerts enabled. However, there is tracking for how long it takes for an employee to engage in their self-evaluation and the line managers to connect back to the employee. You can also see that the ratings calculations are displayed for both workers and managers. The ratings then get pulled into the compensation module.

The specific look of the tab shown above depends on how your organization structures your talent template and performance documents. In the different sections, you can see the criteria that employees are rated on. Each of the sections has a different sequence and number. If you dig into the specific section, there’s a breakdown and rating over time.

The document periods are attached to an eligibility profile which determines who gets assigned this doc and how it gets rated once it’s brought into the compensation module.

There are different notification configurations that can be set up to remind line managers or employees of due dates of documents.

Compensation Setup

The image above shows the different components you’ll utilize when setting up a merit cycle within compensation. The planned foundation configurations make it possible to bring in performance information.

Above, you’ll see that performance ratings are enabled. “Integrate with Oracle Performance Management” is selected. This is referring to Talent Management. Oracle uses these terms interchangeably.

As for the performance template in this case, no specific template needs to be selected because the main document type, Baylor Performance Evaluations, includes all of them and will pull them all in.

The image above shows model properties. These model properties set up the association between performance management scores and salary. It answers questions such as: If the employee’s salary is X, what should their target merit percentage be?

After the model is defined, you’ll have the opportunity to test it in the system.

Baylor uses salary range for the metric, but there are other options you can use instead. There will be a target minimum and target maximum for the metric.

In terms of setup, you’ll enter the values you want to model. For example, to model increases for analysts according to their performance, enter these Percentage of Eligible Salary values:

1. Select the purpose of the model.
2. Determine budget amounts: Use the model rollup amounts as the basis for each subordinate manager’s overall budget.
3. Determine compensation amounts: Use model results as the values in the specified compensation column of the worksheet, such as Merit Amount.
4. Determine target amounts: Use model results as target amounts.

Worksheet Display

Worksheet Display shows person number, worker name, alerts, and more. The significant values for example purposes are the performance score that was given by the manager and the target percentage minimum.

On the second line of the example, you can see the performance score was 3.92 and the target percentage minimum was 4. The manager has not suggested a proposed percentage increase based on this information.

In the third line, the performance score was 3.25. The target percentage minimum is 3.75. The manager suggested a proposed increase percentage of 5%, which is not expected based on the performance score. This specific instance would probably require further discussion with the manager.

Talent Management & Compensation Demo

For a demo of Talent Management & Compensation, watch the linked video from 25:55 to 34:30.

Things to note in the video:

• Pay Change statements are an RTF file, which you can customize completely. You can do this by downloading the RTF file and changing the columns to pull into the file. This is shown in the linked demo.
• Overlaying Oracle Guided Learning across your system is very advantageous for your organization.

Key Takeaways

As you can see from Alfred-Waller’s examples, connecting your Talent Management and Compensation modules can be highly advantageous for your organization. It’s an organized way to keep your employees happy and line managers up to date on employee performance and salary. The two integrate seamlessly for a better experience across the board. Follow in Baylor University’s footsteps and leverage these connections for your organization today.

For more on Talent Management and Compensation modules, check out the Quest Learn Library, and to connect with other Cloud HCM users like Alfred-Waller, consider joining Quest’s Cloud HCM Community group.

For more sessions like this one, consider attending a Cloud HCM Quest Event.