Your best compensation plans and strategies don’t stand a chance of getting approved if you aren’t able to connect them to the overall business strategy and objectives. After all, that’s what your organization's leadership cares about – meeting the goals and objectives they set each year.

These five questions help ensure your compensation strategy begins in the right place — the goals and objectives of the business.

They’re designed to guide your planning conversations, shape your data approach, and connect your recommendations to what leadership already prioritizes.

1. What drives our revenue, and where are the margins?

Revenue is more than a top-line number. Whether your business grows through volume, premium pricing, or services, your comp plan should support that model. For example, a company with high-margin SaaS revenue may prioritize retaining product engineers over boosting sales volume.

2. What are leadership’s top three priorities this year?

If your compensation priorities don’t appear to be connected to the company’s strategic goals, they’ll likely be deprioritized. If global expansion is a goal, comp strategies should incorporate the acquisition of reliable global pay data in target locations, and a source of worldwide benefits regulations to ensure compliance.

3. Where is the business expanding, contracting, or pivoting?

Strategic movement — whether it's growth, consolidation, or a pivot — signals where compensation may need to adapt. In areas of expansion, comp levers can help attract and scale. In areas facing change or uncertainty, strategies like retention incentives or variable pay adjustments may help stabilize key talent.

4. Which roles drive the most value, or carry the most risk?

Not all roles contribute equally. Some have outsized influence on performance, customer outcomes, or margin protection. For example, in healthcare, registered nurses often affect both patient experience and cost efficiency. Focusing investment where the stakes are highest sharpens impact.

5. What KPIs matter most to our C-suite?

To resonate with leadership, comp strategies should tie into the metrics they already track. If the CFO is watching cost per hire and attrition, your model should show how it affects both.

Want help connecting your compensation strategy to business performance? Call 866-605-1031 or email surveys@mercer.com