What is Enterprise Compensation Management (ECM)?

Whether you're a beginner or an expert, you will find this Glossary useful.

Enterprise compensation management refers to the organization, optimization and automation of strategic compensation policies for employees in larger companies.

what-is-enterprise-compensation-management-ecm

Enterprise Compensation Management definition (ECM)

Enterprise compensation management refers to the organization, optimization and automation of strategic compensation policies for employees in larger companies.

Employee compensation is one of the largest operating expenses in every company and affects overall company’s success. Enterprise compensation management is gaining popularity now that companies treat their employees as valuable asset and not just factors of production.

ECM components

ECM has the financial impact of lowering employee turnover, aligning budgetary goals and increasing productivity.

It consists of the two components:

1. Budgeting: involves personnel cost

2. Compensation: includes compensation schemes, fixed and variable pay components (short term and long term incentives)


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