Compensation Data Market

Part
01
of six
Part
01

Human Resources Consulting Services Market Size

The market size of the global Human Resources Consulting Services industry is estimated to be worth $37 billion in 2020. A screenshot of the Statista chart indicating this can be found in the attached Google Doc.

Market Size of the Global Human Resources Consulting Services Industry

  • Consultancy.org stated that between 2011 and 2016, the global revenue of the Human Resources (HR) Consulting Services industry had been experiencing a rise of around $1 billion per year.
  • Moreover, although the global HR Consulting Services industry was estimated to be worth $31 billion in 2016, it only represented approximately 10% of the total global consulting market, making it the smallest of the six main industry segments then.
  • Currently, according to Statista, the market size of the global HR Consulting Services industry is estimated to be worth $37 billion in 2020.
  • Additionally, according to the Statista chart, the HR Consulting Services industry is at position four after the Operations, Financial Advisory, and Technology industries which have estimated market sizes worth $86, $85, and $53 billion respectively.

Additional Findings

  • According to SpendEdge, the HR Consulting Services industry is expected to witness an incremental spend growth of $10 billion between 2018-2023 and accelerate at a CAGR of 4.76% during the same period.
  • SpendEdge believes that this increase in spending will be a result of the rapid adoption of digital Human Resources, increased popularity of social media platforms, and the increasing need for talent management among other factors.
  • As stated by Dun&Bradstreet, the United States is the largest market for consulting services overall and this can be validated by the fact that the United States 2020 HR Consulting Services industry market size is estimated to be $24.9 billion compared to the global one at $37 billion.
  • However, the market size of the United States HR Consulting Services industry is expected to increase by only 0.1% in 2020 probably because of the industry's high competition and low barriers to entry.

Research Strategy

We extensively searched media, market research, and industry databases among other sources in order to find sufficient data on the market size of the global Human Resources Consulting Services industry. We were able to find relevant information from credible sources such as Statista, IBIS World, and Consultancy.org that enabled us to compile the above findings.
Part
02
of six
Part
02

Compensation Analytics Trends

Predictive analytics and benchmarking databases are two trends in the area of compensation analytics, as reported in Sierra-Cedar's 2018-2019 HR Systems Survey.

Predictive Analytics

  • Predictive analytics is "a branch of advanced analysis that extrapolates future events based on existing data sets."
  • In Sierra-Cedar's 2018-2019 HR Systems Survey, 16% of participating organizations were using predictive analytics. Nine percent of the organizations said they were planning to use it in the next 12 months, while 34% were evaluating the feasibility of the feature.
  • "Using predictive analytics to forecast workforce needs" was among the top points identified by participating organizations where HR employees most need to develop or improve in Oracle's HR analytics survey.
  • HR Technologist, an online HR technology information provider, claims that "predictive analytics is now a mainstream function for HR teams across several organizations."
  • Several prominent companies are already implementing predictive analytics in their HR Systems, such as Hewlett-Packard (HP), Google, Wikipedia, Facebook, and Nielsen. However, predictive analytics application, specific to compensation or benefits, was observed in companies like Clarks and Bestbuy.
  • Clarks used predictive analytics to understand which of the benefits their employees valued most, and amend their employee benefits package, resulting in 15% savings.

Benchmarking Database

  • Benchmarking refers to "a comparison exercise that organizations undertake against competitors or peers." Benchmarking "uses a data set (database) obtained from systems, interviews, surveys, or simple observation by an entity that chooses to keep that information."
  • In Sierra-Cedar's 2018-2019 HR Systems Survey, 27% of participating organizations were using benchmarking databases. Six percent of the organizations said they were planning to use it in the next 12 months, while 24% were evaluating the feasibility of the feature.
  • The use of benchmarking databases has been a practice since as early as 2015, as documented by Mercer. In its payroll benchmarking report, Mercer described the feature as “a change to a more strategic and people-orientated focus.” In a 2019 article, Cloudpay claims the trend continues.
  • Benchmarking database is, reportedly, expensive, but there are new payroll solutions that allow organizations to benchmark their data "against an anonymized source of peer data."
  • Mercer, one of the leading compensation benchmarking database provider, has its U.S. compensation benchmark database on sale at a price range of USD 9,050.00 – 20,000.00, but its clients are not disclosed.
  • Companies that participate in benchmarking, such that of Mercer's, receive complimentary reports and are usually the first companies to procure the database. In Mercer's 2015 payroll benchmarking, some of the participants were Amazon, Apple, Cisco Systems, and Microsoft.
  • Additionally, NFP Insurance Brokerage and Consulting has several times mentioned how it used its proprietary benchmarking database composed of data from "2,500 employer groups of all sizes" in identifying employee benefits trends in the US in its 2019 Benefits Insights report.

Research Strategy

To identify compensation analytics trends, our strategy was to look for hard data and statistics from surveys and reports in the HR industry. The survey we found from Sierra-Cedar provided several insights and trends in payroll systems and HR systems, in general. So, we picked the top two intelligent systems building blocks that organizations were already using, which were predictive analytics and benchmarking databases. To further expound on the trends, we searched for other reports and surveys that could corroborate our findings.
Part
03
of six
Part
03

Competitive Landscape of Compensation Consulting Firms 1

Willis Towers Watson, Pay Governance and Aon Hewitt are experts in the implementation and design of compensation plans. However, prices for their services are currently not publicly available.

Willis Towers Watson

  • Willis Towers Watson was founded in 1828. The company is operational in over 140 countries and has 45,000 employees. Willis Towers Watson has 477 office locations globally, with is headquarters being in London, UK.
  • Willis Towers Watson offers different people-centered solutions to its clients, including benefits delivery and administration, compensation strategy and design, cyber risk management, executive compensation, future-of-work, health and benefits, inclusion and diversity, integrated well-being, mergers and acquisitions, retirement, talent, and rewards.
  • Willis Towers Watson also enables its customers to unlock their potential through effective risk management, which enables them to quantify, mitigate and transfer risk.
  • Willis Towers Watson specializes in capital management. Willis Towers Watson collaborates with relevant industry players, such as investors and insurers, to manage their competitors' risk and return.
  • In 2018, Willis Towers Watson generated $8.6 billion in revenue, representing a 5% growth compared to the previous year.

Pay Governance

  • Pay Governance LLC was established in 2010 as a consulting firm. Pay Governance specializes in developing programs that support the company’s unique business situation and strategy. Pay Governance comprises nearly 60 professionals and partners located in U.S, Korea and Japan working with over 400 companies annually.
  • Pay Governance serves as a trusted advisor on executive compensation matters to board and compensation committees.
  • Pay Governance specializes in compensation consulting, offering a range of executive compensation consulting services, including compensation strategy development, executive compensation delivery, metric selection and goal setting, award opportunities, long-term incentive plans, realizable pay and proxy advisor pay-for-performance studies, governance and compliance, institutional and activist investor strategies, trends and best practices, risk assessments, executive arrangements, special situations, and non-employee director compensation.

AON Hewitt.

  • AON Hewitt offers compensation consulting services such as human capital, which enables its clients to make confident business decisions and withstand market volatility. This is done through solutions designed strategically for rewards, talent assessment, and performance.
  • AON Hewitt's total revenue in 2018 increased by 8%, or $772 million, to $10.8 billion.

Research Strategy.

We conducted our research by sourcing information from company websites, articles, business databases, and industry reports published in the past two years. Despite some challenges, we were able to establish that the three companies offer compensation consulting services but none of the companies' prices for its services were publicly available. We mainly looked through the company's website but we also tried to go through third-party databases like G2. We also established that Aon Hewitt and Willis Towers Watson have published their annual revenue reports while Pay Governance had no publicly-available annual reports.
Part
04
of six
Part
04

Competitive Landscape of Compensation Consulting Firms 2

Meridian Compensation Partners has $10.81 million in revenue, FW Cook has $11.86 million in estimated annual revenue, and Mercer generated $4.3 billion in revenue.

Meridian Compensation Partners

  • Meridian Compensation Partners is a management consulting company providing board advisory services, program design, performance alignment, compensation benchmarking, corporate restructuring, and regulatory issues and compliance services.
  • Its board advisory services include governance best practices, committee chair consultation and assistance, committee charter planning and process, meeting participation and facilitation, subject matter and industry expertise, insights into unique company circumstances, board and CEO performance evaluations, and committee member orientation and education.
  • Its program design services encompass compensation philosophy, alignment with business strategy, short and long term incentive plan design, stock ownership and shareholder alignment strategies, retirement and deferred compensation, retention strategies, and severance benefits.
  • For performance alignment services, Meridian offers performance metric evaluation, application in short and long term incentives, performance evaluation and peer comparisons, and realized compensation assessments.
  • The regulatory issues and compliance offering include shareholder voting strategies, proxy advisor strategies, proxy disclosure development, SEC reporting and compliance, tax and accounting strategies, employment agreements, stock plan modeling and approval strategies, severance, expense calculations, governance policies and guidelines.

Compensation Services

  • Meridian's compensation benchmarking services include peer group development, survey evaluation and strategies, position matching, valuation methodologies, and plan design comparisons.

Pricing

  • Meridian Compensation Partners does not disclose the fee/pricing of its service publicly. The information can only be obtained upon contact.

Revenue

The company has an estimated annual revenue of $10.81 million.

FW Cook

Services

  • FW Cook provides compensation consulting services to private and publicly-traded companies. The company's 11 core services are compensation strategy development, competitive review, peer group development, incentive plan design, equity plan considerations, governance and compliance, shareholder communications, severance and transaction assistance, non-employee director compensation, tax-exempt organization executive compensation programs.
  • The company's tax-exempt organization services offered are compensation philosophy and strategy, market competitiveness reviews, incentive plan design in the nonprofit sector, employment agreements, attraction and retention strategies, compensation committee advisor, and intermediate sanctions.
  • Competitive review services include total direct compensation, mix of pay, cash and equity-based incentive programs, benefits and perquisites, stock ownership levels, termination and severance, vasting terms, pay-for-performance, target vs realized pay and share ownership guidelines.
  • Incentive plan design services are long-term incentives, short-term incentives, goal setting, performance metrics, statistical modeling, accounting and tax considerations.
  • The services under its governance and compliance include stock ownership guidelines, compensation program risk assessment, proxy statement disclosure, board and CEO performance assessment, clawback and anti-heding policy, CEO pay ratio, pay-for-performance disclosure, and executive compensation accounting, tax and regulatory considerations.
  • Severance and transaction assistance services are severance and employment agreements, change-in-control provisions, retention strategies, 280G calculations, assistance with IPO process, spin-off transactions, and take private.

Pricing

  • Frederick W. Cook does not disclose its pricing information. The information can only be obtained upon contact.

Revenue

Mercer

Services

  • Mercer provides a broad range of services categorized into four primary services. They are health and benefits, investments and retirement, workforce and careers, and M&A transaction services.
  • The investments and retirement services encompass investments, retirement & benefits plan administration, defined benefit pension plans, pension risk management, defined contribution plans, employee financial wellness, endowments and foundations, MercerInsight, and U.S. wealth & investments.
  • Services provided under workforce and career include talent strategy, executive compensation, workforce rewards, talent mobility, HR transformation, employee communication, workday services, and industry verticals.
  • Mergers and acquisitions transaction services provided are due diligence, project management office, post-merger integration, private equity advisory services, culture diligence & integration in M&A, retaining key talent in M&A, and people risks in M&A.

Mercer's Compensation Services

  • The company provides consulting services to private and public companies executive compensation and rewards programs. Its compensation services are part of the company's workforce and career services.

Pricing

Revenue

Research Strategy

None of the three companies publicly made available their pricing information. We began by combing through the websites of the companies' products and services page. The pricing details for each service provided by the companies can only be accessed upon contact, as stated by the companies on their products and services pages. Next, we searched through review sites like Softwaresuggest, G2, Vault, Trustpilot, among others. The goal was to locate the information from reviews of the companies by experts and consumers. Unfortunately, there was limited information on the pricing of products/services . As stated by the review sites, the companies do not provide their pricing information. We also tried to locate the pricing information by reviewing thought leadership articles published by the companies, their case studies, and client testimonials. This strategy also didn't yield any results as pricing details were not available.
Part
05
of six
Part
05

Competitive Landscape of Compensation Consulting Firms 3

Pearl Meyer is a leading consulting firm and advisor to executive boards and senior management on how to align executive compensation with business and leadership strategy. The compensation consulting firm works with clients across multiple industries like energy, banking, healthcare, mergers and acquisitions, and high-growth startups. We have provided the requested competitive landscape details for Compensation Advisory Partners, Pearl Meyer, and Semler Brossy below.

Compensation Advisory Partners (CAP)

Pearl Meyer

Executive Compensation

Director Compensation

Compensation Governance

Employee Compensation

Pearl Meyer Pricing and Annual Revenue

  • Pearl Meyer works with companies of different sizes, from Fortune 500 and FTSE 300 publicly traded companies, private companies, not-for-profits companies, and startups from different industries. This means that the firm's pricing for its consulting services may be different according to the company size and the industry it operates in.
  • Prospective clients interested in more information, including pricing, have to contact the firm's office, a consultant of the firm, or join the firm's mailing list.
  • Pearl Meyer has an estimated annual revenue of $14 million.

Semler Brossy

Part
06
of six
Part
06

Competitive Landscape of Compensation Consulting Firms 4

Compensia and Exequity specialize in providing compensation consulting services. Hay Group/Korn Ferry Advisory provides compensation consulting services and other services that fall under categories such as organizational strategy, assessment & succession, and leadership development. Compensia, Exequity, and Hay Group/Korn Ferry Advisory do not publicly disclose pricing information for their services.

Compensia

  • Compensia specializes in providing compensation consulting services to technology and life sciences companies.
  • The services provided by Compensia fall under categories such as executive compensation, incentive compensation design & strategy, and board of directors compensation.
  • The executive compensation category includes competitive pay benchmarking & analysis, equity retention & realized pay analyses, pay & performance alignment analyses, post-employment compensation arrangements, and executive perquisites & benefits.
  • The incentive compensation design & strategy category includes short-term incentive compensation plans, long-term incentive compensation programs, equity selection, allocation strategy & scenario modeling, annual equity usage modeling, share pool funding projections, proxy advisory firm review, and shareholder approval strategy.
  • The board of directors compensation category includes competitive pay benchmarking & analysis, director compensation program design, and transition of board status from late-stage private company to formal public company.
  • Compensia does not list the prices of its services.
  • Interested clients may contact the company via email (compensiaconsulting@compensia.com) or phone (408-876-4025) for pricing enquiries.
  • The estimated annual revenue for Compensia, a privately-held company is $10 million.

Exequity

  • Exequity specializes in providing compensation consulting services to Fortune 100 companies, private, and pre-IPO organizations.
  • The services provided by Exequity fall under categories such as compensation benchmarking & program design, technical, governance & compliance, and transactions & transitions.
  • The compensation benchmarking & program design category includes competitive compensation program development and advisory services for regulations and tax compliance.
  • The technical, governance & compliance category includes advisory services for technical, regulatory, and compliance implications related to compensation decisions and Institutional Shareholder Services (ISS) equity plan modeling.
  • The transactions & transitions category includes merger and acquisition services such as due diligence, incentive and equity plan transitions, and 280G golden parachute modeling, and IPO and spin-off services such as equity conversions, transaction-related incentives, and others.
  • Exequity does not list the prices of its services.
  • Interested clients may contact the company via contact form or phone (847-996-3960) for pricing enquiries.
  • The estimated annual revenue for Exequity, a privately-held company is $1.7 million.

Hay Group/Korn Ferry Advisory

  • Hay Group is now known as Korn Ferry Advisory.
  • The services offered by Korn Ferry Advisory fall under categories such as organizational strategy, assessment & succession, leadership development, and rewards & benefits.
  • Korn Ferry Advisory’ rewards & benefits category includes compensation consulting solutions for executive pay & governance, employee rewards, work measurement, and sales compensation.
  • The executive pay & governance solution includes executive pay and governance program designing, consulting services on base compensation & other critical issues, competitive pay benchmarking, regulatory compliance, ISS modeling, compensation strategy after IPOs, mergers and acquisitions & other transitions, and investor communication procedures.
  • The employee rewards solution includes reward strategies alignment, organization’s and employee’s needs balancing, compensation & tasks matching, pay program benchmarking, benefit & incentive program designing, and strengthening of the link between rewards and performances.
  • The work measurement solution includes job evaluation, job analysis & design, grade structure design, career frameworks, job family modeling, job-person fit analysis, organization design, and equal pay analysis.
  • The sales compensation solution includes expert assessments, existing strategies benchmarking, sales compensation & incentive program creation, Linking business strategy with sales compensation & rewards, and sales talent strategy development.
  • Korn Ferry Advisory does not list the prices of its services.
  • Interested clients may contact the company via contact form or phone (800-633-4410) for pricing enquiries.
  • The FY 2019 revenue for Korn Ferry Advisory was $821.048 million.

Research Strategy

The pricing information for Compensia, Exequity, and Hay Group/Korn Ferry Advisory are not publicly available. To identify the required information, we first examined the websites of Compensia, Exequity, and Hay Group/Korn Ferry Advisory. None of these companies have published pricing information on their websites.

Next, we conducted a press search for these companies. None of the articles examined provided pricing information for the services provided by Compensia, Exequity, and Hay Group/Korn Ferry Advisory. The articles only mentioned Compensia’s client, Exequity’s compensation calculating technique, research conducted by Hay Group/Korn Ferry Advisory, and other general information. It is assumed that these companies do not publicly disclose pricing information due to competitive reasons. Interested clients may contact the companies via email, contact form, or phone for pricing enquiries.
Sources
Sources