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Transcript of CRM Mod1 Student
-
7/29/2019 CRM Mod1 Student
1/50
AmityBusiness
S
chool
INTROD
UCTION
T
O
COMP
ENSATI
ON&RE
WARD
MANAGEMENT
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7/29/2019 CRM Mod1 Student
2/50
AmityBusiness
S
chool
Topicscoveredafterthe
learning:
1.
ConceptofCompensatio
n,
2.
Systemo
fCompensating,
3.
ConceptofRewardand
RewardSystem
,
4.
Economic
TheoryofWages,
5.
LimitationsofEconomic
Theories,
6.
WageandSalaryAdmin
istrationatmicrolevel,
7.
Wagecon
cepts,
8.
Roleofvariousparties
Employees,Employers,
Unions&
Government,
9.
Overview
ofLegislationsaffectingCom
pensation
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7/29/2019 CRM Mod1 Student
3/50
AmityBusiness
S
chool
CONCEPTOFCOMPEN
SATION
Compens
ationiswh
atemploye
esreceive
inexchang
efortheir
contributio
ntothe
organization
Anemplo
yeesstandardoflivin
g,status
inthesoci
ety,
Motiva
tion,
Loyaltyand
Productivitydependu
ponthe
compensationhe/she
receives
Forthee
mployerto
employee
remunerat
ionissigni
ficantbeca
useofits
contributiontocosto
fproductio
n
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7/29/2019 CRM Mod1 Student
4/50
AmityBusiness
S
chool
NATUREO
FCOMPENS
ATION
Compens
ationcanb
eofferedb
yan
organizationbothdirectly(Base
Pay&
VariablePay)andInd
irectly(Be
nefits)
1.
BasePa
y-Basiccompensation
an
employee
getsusuallyasawageorsalary
2Variable
Pay-Comp
ensationlinked
directlyto
theperformance
3.
Benefits
-Indirectrewardsgiv
enasa
partoforg
anizationalmembersh
ip.
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7/29/2019 CRM Mod1 Student
5/50
AmityBusiness
S
chool
MAINOBJE
CTIVESOF
COMPENSA
TION
1.
Internal
Equity-Ensuresthatmo
redifficult
jobsarepaidmore.
2.
ExternalParity-Aim
stocompen
satefairlyin
compariso
ntosimilarjobsinlabor
market.
3.
Individu
alEquity-EqualPayfor
equalwork.
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7/29/2019 CRM Mod1 Student
6/50
AmityBusiness
S
chool
SOMEOTH
EROBJECT
IVES
Toattracttalent
Toretain
talent
Ensuree
quity
Tomotiv
atenew&
desiredbehavior
Controlcost
Complywithlegalrules
Easeofo
peration
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7/29/2019 CRM Mod1 Student
7/50
AmityBusiness
S
chool
FACTORSI
NFLUENCIN
GEMPLOYEE
COMPENSA
TION
I.External
Factors
i.LaborM
arket
ii.
Costof
Living
iii.LaborLaws
iv.
Society
v.
Econom
y
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7/29/2019 CRM Mod1 Student
8/50
AmityBusiness
S
chool
Contd./
II.
Interna
lFactors:
i.Busine
ssStrategy
ii.
JobEvaluation&Performanc
e
Appraisal
iii.Emplo
yee
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7/29/2019 CRM Mod1 Student
9/50
AmityBusiness
S
chool
SYSTEM
O
F
C
OMPEN
SATING
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7/29/2019 CRM Mod1 Student
10/50
AmityBusiness
S
chool
PayforWo
rk&Perform
ance
PayforTim
enotWork
DisabilityIncomeCont
inuation
DeferredI
ncome
Spouse(Family)Incom
eContinuat
ion
Health,
Ac
cident&LiabilityProtection
IncomeEq
uivalentPay
mentsPer
ks
Organizati
onsDevelop
CompensationPolicy
Dimensions
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7/29/2019 CRM Mod1 Student
11/50
AmityBusiness
S
chool
HOWI
SCOMPENSATIONUSED?
Compensa
tionmaybe
adjustedac
cordingthe
businessn
eeds,goals,andavailab
leresources
Compensationmaybeus
edto:
recruitand
retainqualifie
demployees.
increaseormaintainmor
ale/satisfaction
.
rewardandencouragepe
akperformanc
e.
achieveinternalandexte
rnalequity.
reducetur
noverandencouragecompan
yloyalty.
modify(th
roughnegotiat
ions)practices
ofunions.
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7/29/2019 CRM Mod1 Student
12/50
AmityBusiness
S
chool
WHATAR
ETHECOM
PONENTSOFA
COMPENSATIONSYSTEM?
Thecomponentsofac
ompensationsystem
include:
JobDesc
riptions
JobAnal
ysis
JobEvaluation
PayStru
ctures
SalarySurveys
PoliciesandRegulations
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7/29/2019 CRM Mod1 Student
13/50
AmityBusiness
S
chool
WHATARE
DIFFERENTTYPESOF
COMPENSA
TION?
Differenttyp
esofcompe
nsationinclude:
BasePay
Commissio
ns
OvertimePay
Bonuses,P
rofitSharing,
MeritPay
StockOpti
ons
Travel/Meal/HousingA
llowance
Benefitsin
cluding:den
tal,insuranc
e,medical,
vacation,
leaves,retirem
ent,taxes...
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7/29/2019 CRM Mod1 Student
14/50
AmityBusiness
S
chool
COMPENSATIONPLAN
Developaprog
ramo
utline
Designateanin
dividualtoove
rsee
Developacompensationphilo
sophy
Conductajobanalysisofallp
ositions
Evaluatejobs
Determinegrad
es
Establishgrade
pricingandsa
laryrange
Determineana
ppropriatesala
rystructure
Developasalaryadministratio
npolicy
Obtaintopexecutives'approv
alofthebasic
salaryprogram
Communicatet
hefinalprogra
mt
oemployee
sandmanagers
Monitorthepro
gram
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7/29/2019 CRM Mod1 Student
15/50
AmityBusiness
S
chool
CONCEPT
O
F
REW
ARD
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7/29/2019 CRM Mod1 Student
16/50
AmityBusiness
S
chool
Rewardisacompositeofall
Rewardisacompos
iteofall
organiza
tionalmechanism
and
organiza
tionalmechanism
and
strategie
susedtofinallyacknowledge
strategie
susedtofinallyacknowledge
employe
esbehaviorandperformance.
employe
esbehaviorandperformance.
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7/29/2019 CRM Mod1 Student
17/50
AmityBusiness
S
chool
OBJECTI
VEOFREW
ARD
OBJECTI
VEOFREW
ARD
Tomotiva
teemployees
toperformeffectively
Tomotiva
teemployees
tojointheorg
anization
Tomotiva
teemployees
tocontinueto
work
Enhance
Loyalty
Satisfaction
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7/29/2019 CRM Mod1 Student
18/50
AmityBusiness
S
chool
Financial
Rewards
Financial
Rewards
++
NonFinanc
ialRewar
ds
NonFinanc
ialRewar
ds
==
TotalReward
TotalReward
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7/29/2019 CRM Mod1 Student
19/50
AmityBusiness
S
chool
FINANCIALREWA
RDS
FINANCIALREWA
RDS
Anumber
ofmonetary
benefitsoff
eredto
employeestoobtainshortterma
nd
longterm
commitmen
t.
Typesoff
inancialrewardsgivenare;base
pay,variablepay,share
ownership,
bonus,etc.
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7/29/2019 CRM Mod1 Student
20/50
AmityBusiness
S
chool
NONFIN
ANCIALRE
WARDS
NONFIN
ANCIALRE
WARDS
Non-financialrewardscatermainlytofulfill
thepsycho
logicalneed
softheemp
loyees
Typesof
nonfinancia
lrewardsgivento
employees
are;recogn
ition,opport
unitiesto
developsk
ills,qualityofworklife,etc.
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7/29/2019 CRM Mod1 Student
21/50
AmityBusiness
S
chool
REWARD
SYSTEM
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7/29/2019 CRM Mod1 Student
22/50
AmityBusiness
S
chool
Levelo
fskill
RateofPay
AdoptedfromBanfieldPaulandKayRebeccaIntrodu
ctiontoHRM.
OxfordUniversityP
ressVol.4PageNo.
308
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7/29/2019 CRM Mod1 Student
23/50
AmityBusiness
S
chool
WHYREW
ARDSYST
EMS?
Attractin
g,retaining
&motivating
employees
Togetdesiredbehav
ior
Toachievestretchst
andards
Tocater
individualneeds
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7/29/2019 CRM Mod1 Student
24/50
AmityBusiness
S
chool
REWARDM
ECHANISM
S
Praise/rec
ognitionfrom
supervisor
s
Challengingworkass
ignments
Promotion
sandlateralmoves
Paid
leavetoem
ployees
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7/29/2019 CRM Mod1 Student
25/50
AmityBusiness
S
chool
GETTINGMOREOUT
OFREWARDS
Aligningr
ewardswith
objectives
Outcome-basedevalu
ationofemp
loyee
Agreeing
whatbehavi
orsandcapa
bilities
willberewarded
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7/29/2019 CRM Mod1 Student
26/50
AmityBusiness
S
chool
DesigningR
ewardSyste
m
W
homt
oRew
ard?
IndividualEmployees
Teams
Organization
Outsiders
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7/29/2019 CRM Mod1 Student
27/50
AmityBusiness
S
chool
DesigningR
ewardSyste
m
W
hattoRewa
rd?
Performance
Organization
alLevel
Unit/Depar
tmentalLevel
SpeedandE
fficiency
Loyalty
Innovation
UpholdingValues
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7/29/2019 CRM Mod1 Student
28/50
AmityBusiness
S
chool
TechnicalS
olution
Learning
GoodBeh
avior
SenseofHumor
Teaching
Publications
EventManagement
SocialConcern
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7/29/2019 CRM Mod1 Student
29/50
AmityBusiness
S
chool
C
haracteristicsofrewa
rds
Rewardsmusthavethefo
llowingcharacteristics
Value
Relevant
Purpose
Behaviorale
ffect
Recognition
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7/29/2019 CRM Mod1 Student
30/50
AmityBusiness
S
chool
Co
nceptofTot
alRewardSystem
TotalRewardStrategiessh
ouldinclude
DirectFinancial
IndirectFina
ncial
Identification
WorkContent
CareerOppo
rtunities
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7/29/2019 CRM Mod1 Student
31/50
AmityBusiness
S
chool
R
ewardsc
anfailin
theform
ofincentives
Kohn
Payisnot
amotivator
Rewardsp
unish
Rewardsrupturerelationships
Rewardsignorereason
s
Rewardsd
iscouragerisktaking
Rewardsu
ndermineinterest
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7/29/2019 CRM Mod1 Student
32/50
AmityBusiness
S
chool
EC
ONOMICTHEO
RY
OFW
AGES
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7/29/2019 CRM Mod1 Student
33/50
AmityBusiness
S
chool
ECONOM
ICTHEORIES
1.Social
Wage
The
ories
Subsis
tence
The
ory
Wagefund
Theory
Resid
ualClaimant
Theory
MarxianTheory
2.Ju
stification
The
ories
Marginal
Productivity
Th
eory
Bargain
ing
Theory
Supplyand
Demand
Theory
Competitive
Theory
3.Behavioral
The
ories
Employees
Acc
eptance
level
Int
ernalWage
Structure
Wageand
Motivation
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7/29/2019 CRM Mod1 Student
34/50
AmityBusiness
S
chool
LIMITAT
IONSOFECONOMICT
HEORY
WagesandPricesareeitherfullyfixedor
fullyflexible.
Assu
mptionofFu
llE
mployme
nt
Wagescouldbeinfluencedbyfactorsother
thanw
agestoo.
WageandBenefitsreflectIndustry
characteristicsand
personalch
aracteristics
.
Interferencebyg
overnment
Tech
nologyandProductivityaremajor
determ
inants
Pressureforlinkinglabourstandardswith
Intern
ationalTrade.
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7/29/2019 CRM Mod1 Student
35/50
AmityBusiness
S
chool
WA
GESAN
DSALA
RY
ADMINIS
TRATIO
N
A
T
MICRO
LEVEL
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7/29/2019 CRM Mod1 Student
36/50
AmityBusiness
S
chool
Policies
Techn
iques
Objectives
ALIGNMENT
Work
analysis
Description
EFFICIEN
CY
-Perform
ance
-Quality
-Customers
-Costs
FAIRNESS
COMPLIA
NCE
INTERNAL
STRUCTURE
COM
PETITVENESS
Market
Surv
eysPAYSTRUCT
URE
C
ONTRIBUTION
Seniority
Based
Performance/
MeritB
ased
INCENTIVE
PROGRA
MS
MANAGEMENT
Costs
CommunicationEVALUATION
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7/29/2019 CRM Mod1 Student
37/50
AmityBusiness
S
chool
INTERNALALIGNMENT
DependentofInternalPayStructure
Levels
Differentials
Criteria
-C
ontentand
Value
-U
seValuean
dExchange
Value
-J
obandPersonBased
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7/29/2019 CRM Mod1 Student
38/50
AmityBusiness
S
chool
EXTERNALCOMPE
TITIVENES
S
Factors
ShapingExt
ernalCompe
titiveness
LabourMarket
Natureof
Demand
Natureof
Supply
ProductM
arketFactors
DegreeofCompetition
LevelofP
roductDemand
OrganisationFactors
Industry,
Strategy,
Size
Individua
lManager
EXTERNAL
COMPETITIVENESS
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7/29/2019 CRM Mod1 Student
39/50
AmityBusiness
S
chool
CONTRIBUTION
Senio
rityBased
Perfo
rmanceBasedPay
Merit
Guidelines
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7/29/2019 CRM Mod1 Student
40/50
AmityBusiness
S
chool
MANAGE
MENT
Managin
gLabourCo
st
-ControllingEmployment
-Controllingav.
CashCompensation
Communication
-Ma
nagingtheM
assage
Pay
-Ch
angeAgentinRestructuring
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7/29/2019 CRM Mod1 Student
41/50
AmityBusiness
S
chool
W
AGECONCEPT
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7/29/2019 CRM Mod1 Student
42/50
AmityBusiness
S
chool
WAGE
ANDSALARY
Wage
:Indexofproductivity
DefinitionofWage
Wage
vsSalary
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7/29/2019 CRM Mod1 Student
43/50
AmityBusiness
S
chool
ROLEOF
VARIOUS
PARTIESIN
COMPENSATION
&
REW
ARD
MANAG
EMENT
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7/29/2019 CRM Mod1 Student
44/50
AmityBusiness
S
chool
ROLEOFEMPLOYERS
Abilitytopay
Costeff
ect
Wagecosts
Unitlabourcosts
Costreduction
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7/29/2019 CRM Mod1 Student
45/50
AmityBusiness
S
chool
ROLEOFEMPLOYEES
Abilitytoliveandwork
Priceeffect
Wagele
vels
Effortputin
Wagem
aximization
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7/29/2019 CRM Mod1 Student
46/50
AmityBusiness
S
chool
ROLEOF
THEGOVE
RNMENT
Five
YearPlans&
WagePolicy
Lega
lFramework
-Paymento
fWagesAct1936
-MinimumWagesAct1948
-Paymento
fBonusAct19
65
-EqualRem
unerationAct1976
Unila
teralPayFixation
PayCommissions
WageBoards
Adju
dication
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7/29/2019 CRM Mod1 Student
47/50
AmityBusiness
S
chool
ROLEOF
UNIONS
Collectiv
eBargaining
(Levels)
Secto
ralBargainin
gatNationa
lLevel
Indus
try-cum-Re
gionwideAg
reements
DecentralizedFirm
/PlantLevel
Agreem
ents
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7/29/2019 CRM Mod1 Student
48/50
AmityBusiness
S
chool
LEGISL
ATIONS
AFFECTING
COMPEN
SATION
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7/29/2019 CRM Mod1 Student
49/50
AmityBusiness
S
chool
A
CTSAFFECTI
NGCOMPENS
ATION
PaymentofGratuityAct,197
2
TheWorkmen
sCompensatio
nAct,1923
TheContractLabor(R&A)A
ct,
Article43ofC
onstitutionOfIndia
All
actswithWageorSalary
oranycompensationbetwee
n
t
heEmployerandEmployee
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7/29/2019 CRM Mod1 Student
50/50
AmityBusiness
S
chool
THANKYOU!