3 Strategies to Address Subcontractor Work Falling Short of Expectations
In the world of construction, subcontractor performance can make or break a project. This article delves into effective strategies for addressing subpar work from subcontractors, drawing on insights from industry experts. Discover practical approaches to ensure project success and maintain high standards in construction management.
- Skills-Based Banding Balances Equity and Competitiveness
- Market Benchmarking Ensures Fair and Competitive Pay
- Compensation Matrix Aligns Internal and External Factors
Skills-Based Banding Balances Equity and Competitiveness
Balancing internal equity with external competitiveness in compensation is something I've found particularly challenging in the logistics space, where talent needs vary dramatically across warehouse operations, technology teams, and client-facing roles.
At Fulfill.com, we've developed what I call our "Skills-Based Banding" approach. Rather than focusing solely on traditional job titles, we evaluate compensation based on the specific skills and competencies that drive value in our 3PL ecosystem. This creates internal equity by ensuring everyone with similar impact-driving capabilities is compensated fairly, regardless of department.
For external competitiveness, we conduct quarterly market analyses focused specifically on the logistics tech sector. The 3PL industry moves quickly, and compensation trends can shift dramatically between peak and off-peak seasons. When we see market rates shifting for critical roles, we adjust proactively rather than waiting for annual reviews.
I've seen this strategy work particularly well with our fulfillment specialists who bridge the gap between eCommerce brands and 3PL partners. In one case, we noticed high turnover when these specialists were banded based on years of experience rather than specialized knowledge of fulfillment operations. By reweighting our compensation formula to value industry-specific expertise, we retained key team members who had unique insights our clients needed.
The logistics industry is relationship-driven at its core. I've found that no compensation strategy works without transparency. When team members understand how their compensation connects to both internal equity measures and external market factors, they're more likely to see the system as fair, even when perfect balance isn't always possible.
Market Benchmarking Ensures Fair and Competitive Pay
Balancing internal equity with external competitiveness in compensation can be tricky, but I focus on ensuring that pay is fair within the company while also aligning with industry standards. One strategy I use is conducting regular market benchmarking. I compare our compensation packages against industry competitors, looking at both base salary and benefits, while also considering the unique skills and experience within our team. For internal equity, I ensure that employees in similar roles with comparable performance and experience are paid within a narrow range, fostering fairness. When there's a discrepancy between internal equity and market data, I prioritize open communication—explaining to employees why certain adjustments might be necessary to stay competitive, without undermining fairness within the team. This approach helps maintain morale while ensuring we're still competitive in attracting top talent.
Compensation Matrix Aligns Internal and External Factors
We utilize role benchmarks from external data and adjust them based on their internal impact. First, we verify ranges from sources such as Levels.fyi or industry-specific reports. Then we ask: where does this role sit in our value chain? Someone managing client campaigns directly might receive a bump in compensation over a similar market rate if their work positively impacts retention.
One strategy is to create a compensation matrix with salary bands tied to role, responsibility, and seniority. It maintains consistent pay across the team while allowing room for competition for top external talent. Internal equity matters—but so does not losing great hires over $5K.
