C8 Business Acumen for Compensation Professional Questions and Answers

An understanding of the culture and subcultures of your organization

The capacity to manage multiple projects and priorities and meet deadlines

A willingness to take on additional duties and responsibilities when resources are limited

A thorough understanding of the products and/or services your organization provides

They typically have the greatest effect on net income and operating results of any organizational expense or program

Their success or failure is closely tied to the success or failure of organizationwide goals and objectives

They have very little effect as long as they are managed effectively and efficiently

They affect the organization’s overall financial status and impact multiple stakeholders across most, if not all, business units

Limiting spending to a fixed percentage of organizational revenue

Making choices about spending based on expectations of performance

Increasing profitability of the business annually to maximize shareholder/owner value

Complying with local legislation and maintaining accurate records to prepare financial reports and tax documents

They aren’t. Managers are concerned about their compensation also.

They are also responsible for merit increases, incentives and hiring so they have greater information needs.

They tend to have more influence, so it is important to resolve any concerns they have quickly and efficiently.

They have more duties and responsibilities and are less likely to have the time to discuss compensation issues.

Whether to improve productivity, obtain new operating capital or generate new sales growth

Whether to reinvest in existing products, create new products or maximize profits with current products as long as possible

Whether to acquire competitors with greater market share or merge with more successful companies

Whether to increase sales, maximize distribution capacity or increase efficiency to meet growing demand

What direction will we take?

How do we work?

Why are we in business?

How will we achieve our objectives?

Gross profit

Revenue

Net income

Operating profit

Possess a high level of education and competency in accounting principles

Determine which programs are crucial to the enterprise and which programs are expendable

Partner with multiple departments and external consultants and vendors

Demonstrate broad understanding of principles of financial management and business expertise