"Compensation Systems" Please respond to the following:
- Analyze the compensation professional's goals to determine which would be the most difficult for you to realize. Discuss ways you might be able to overcome these difficulties.
- Create a list of five best practices that any organization could use to leverage a compensation system for positive impact. Provide specific examples to support your response.
Here is a sample answer.
Compensation Systems-
Quoted by our text, Compensation professionals promote effective compensation systems by meeting three (3) important goals: internal consistency, market competitiveness, and recognition of individual contributions. Internal Consistency involves doing a job analysis and job evaluation. This process would not be an issue to perform. I would base the recognition of an individual contribution through appraisals and feedback from managers. Market competitiveness would involve a lot of research and strategic analysis to be competitive in the market place. This process can be more difficult than the others because of the changes in any given industry and the economy. I would hire a special target group to stay on top of the research in the marketplace producing annual reports showing any changes that may occur in the industry.
Five (5) Practices that any organization could use to leverage a compensation system for positive impact:
1. Align Finance and Sales for Growth and profits
2. Align Compensation to Employee's Performance
3. Automate and centralize compensation processes
4. Ensure internal process controls and ongoing compliance
5. Model, forecast and plan.
Reference: Martocchio, J.J. (2013). Strategic compensation: A human resource management approach (7th ed.).
Reference: http://blogs.richardson.com/2012/12/06/5-best-practices-for-sales-compensation-management-start-by-aligning-finance-and-sales/