Gmb 6070 session 6 - june 13th (fil eminimizer)
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Transcript of Gmb 6070 session 6 - june 13th (fil eminimizer)
GM
B6
07
0 - S
HR
M F
RA
NK
FURTC
LASS1
STRATEGIC REWARD AND COMPENSATION SYSTEMS
Session 6 13
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PRESENTATION PLAN
1. Deference between reward and compensation
2. Strategic importance of compensation system
3. Employee benefits and benefit programs
4. Job evaluation5. Class group discussion
tasks
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REMUNERATION SYSTEM
Usually money Incentive to drive
achievement Given for special
service A satisfying return,
result or profit Gratify It could also be
something not given in retribution for inferior/evil activities
Is a money value given in exchange for work performed
Used to: Attract and retain
talent Maintain morale or
level of satisfaction Encourage peak
performance Achieve equity –
Internal/External Encourage loyalty Modify practices
Reward Compensation 13
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PAY BASED COMPETENCES FOR HR1
3th
June '1
1
Communication Team work Problem solving Coaching/
mentoring Customer care Integrity/Honesty ICT Application Leveraging
diversity
Employee Benefits
Labour Relations
Job Evaluation Searching,
attracting and recruitment
Core Competencies
Technical competencies
Strategic Competencies
•Change management•Guiding and Influencing•Project management•Strategic thinking
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STRATEGIC IMPORTANCE OF COMPENSATION SYSTEM Recruit and retain qualifies employees. Employer may need to adjust and
respond to market forces. Morale and job satisfaction are affected
by compensation levels. There has to be a balance between what
the employer is willing to pay and what the employee feels she/he is worth and is indeed the market value worth.
Use it to recognize exceptional performance – bonus pay, commission, stock, profit sharing, gain sharing
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ENSURING BALANCE AND STABILITY IN REWARD AND COMPENSATION
HRM should ensure:Development of job descriptions for
every job holderAnalysis of all jobsEvaluation of all benchmark jobsBanding, ranking and grading of all
jobsFrequent salary surveys Development of policies, guidelines
and other SOPs.
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Microsoft Office Excel 97-2003 Worksheet
Microsoft Office Excel 2007 Workbook
Microsoft Office Word 97 - 2003 Document
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EMPLOYEE BENEFITS AND BENEFIT PROGRAMSBase payCommissionsOvertimeBonuses, profit sharing, merit payStock optionsAllowances: travel, meals, housingBenefits: education, medical,
insurance, leave, holidays, retirement, taxation
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JOB EVALUATIONDetermine relative worth of jobs in the organization
Verify by comparing with industry market data and adjust as may become necessary
Prepare a matrix organizational review
Prepare rankingPrepare a matrix organizational review
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Microsoft Office Excel 97-2003 Worksheet
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Establish jobs that cross lines and departments (matrix reporting)
Compare the matrix with data from both the company structure and the industry market realities
Prepare flow charts of all ranks for each department for ease of interpretation and assessment.
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Microsoft Office Excel 97-2003 Worksheet
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Present data and charts to the compensation committee for review and adjustment
Determine gradesEstablish the number of levels, junior,
intermediate and beginner for each job family and assign a grade to each level
Determine the number of pay grades, or monetary range of a position at a particular level, within each department.
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Establish grade pricing and salary range
Establish benchmark/key jobsReview the market price of benchmark jobs within the industry
Establish a trend line in accordance with company philosophy – where the organization wants to be in relation to salary ranges in the industry
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Microsoft Office Excel 97-2003 Worksheet
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Salary structure determinationDetermine the difference between each salary step.
Determine a minimum and a maximum percent spread.
Slot the remaining jobs.
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Salary administration policyReview job descriptions.Verify the purpose, necessity for maintaining the position.
Review with the compensation committee for adjustment and mandate to roll out.
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Develop, document and communicate the general policy and execute
Develop and document specific policies for selected groups
Develop and document a strategy for merit raises and other pay increases, such as cost-of-living adjustment, bonuses, annual review, promotions
Develop and document procedures to justify the policy - performance appraisal forms, merit raise schedule
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Executive approval for salary structure and roll outDevelop and present cost impact
studies that project the expense of bringing the present staff up to the proposed levels
Present data to the compensation committee for discussion and approval
Present data to the senior executive for buy-in
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Communicate the final program to employees and managersPresent the plan to the compensation committee for feedback, adjustment, review and approval
Make a presentation to the executive team and managers for approval or change, and incorporate necessary changes
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Develop a plan for communicating the new program to employees, using slide shows or movies, literature, handouts
Make presentations to managers and employees then execute the program
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Design and develop detailed systems, procedures, and forms
Work with HR information systems staff to establish effective implementation procedures, to develop appropriate data input forms, and to create effective monitoring report for senior managers.
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Have the necessary forms printed
Develop and determine format specification for all reports
Execute test runs on the human resources information system
Execute the program
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Monitor the programMonitor feed backAdjust as necessaryIdentify challenges in the program and adjust accordingly
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CLASS GROUP DISCUSSION TASKS
Is job evaluation a value adding exercise or a academic waste of time indulgence. Critically review the question from strategic HR perspective.
In an organization where there is an effective compensation structure, review why SHR people should concern themselves with developing rewards and benefits systems?
Eagles Synergy3 Team-Six
Many SHR Directors benchmark best practices in developing compensation a compensation system. Develop a case for benchmarking HR best practices.
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READING ASSIGNMENT Read Course Text Chapter
Cha. 11 – Strategic Compensation Systems - Pg.390 – 429
Cha. 13 – Benefit Plans - Pg.463 - 508
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END OF SESSION 6
Thank you
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