The Alignment Of Compensation And Business Strategies Essay

Compensation is a cardinal component in the success of any concern. Although compensation programs were non ever seen as a strategic concern enterprise, their immense impact on a company ‘s underside line, recruiting, retaining and actuating people has led to compensation design being considered an of import component to accomplishing success ( O’Connell, 2007 ).

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The alliance of compensation & A ; concern schemes

It is indispensable that a just, competitory and attractive compensation program is created in order to guarantee the future success of the company. If the compensation program is carried out decently it can ‘improve organizational effectivity, support human capital demands of a concern, and motivate and reward accomplishment of cardinal corporate strategic and fiscal ends ( O’Connell, 2007: 20 ). It is therefore indispensable that compensation programs are good thought out and efficaciously designed. Compensation is the reply to pulling, retaining and actuating employees who have the necessary competences to transport out the concern scheme and manage greater duties ( Milkovich, Newman & A ; Gerhart, 2007 ).

Directors must take note of the wagess that motivate their employees. If this is non done, it may ensue in a mismatch between the schemes being used by directors to actuate their employees and the motivational wagess that the employees prefer ( Arnolds & A ; Venter, 2007 ). This mismatch, every bit good as failure on the portion of directors and employees to make common land in the chase of organizational aims, can ensue in houses neglecting to successfully implement their concern schemes. Employees will execute at a low degree, making merely what is least expected of them when the wages systems are non aligned to their demands. They will non be motivated to set in excess attempt so that the administration ‘s ends can be achieved ( Arnolds & A ; Venter, 2007 ). It is hence of import for all houses to regularly assess the wagess that motivate employees.

Different administrations have different compensation policies in topographic point. Matching compensation policies to concern scheme leads to greater organizational public presentation ( Montemayor, 1996 ). Some administrations are speedy to present a new compensation plan based on what they have heard about it. The job is that it may non suit with their administration ‘s strategic way. Merely plans that can travel the administration farther along its strategic way should be identified and implemented ( Kaplan, 2007 ). Ultimately, compensation schemes seek to either lessening costs or increase grosss comparative to rivals ( Milkovich et al, 2007 ).

Compensation professionals play an of import function in assisting administrations put their concern schemes into consequence by presenting appropriate compensation programs. ‘Compensation experts need to be at the focal point where scheme, organizational effectivity and human capital direction converge ‘ ( O’Connell, 2007: 25 ). It is of import that they have a clear apprehension of the concern, the organizational issues and the way in which the company is headed. Organisational, employee and concern demands must be balanced with the fiscal and strategic ends of the company. Merely so can the right compensation scheme be developed to actuate, wages and prolong high degrees of public presentation. When this balance is found, ‘a company can efficaciously utilize compensation to put to death and accomplish desired concern consequences ‘ ( O’Connell, 2007: 25 ).

For illustration, if a company ‘s scheme is to be advanced, the scheme will concentrate on new merchandises and a short response clip to market tendencies. The compensation scheme must be tailored to aline with the concern scheme. A back uping compensation scheme will therefore put less accent on measuring accomplishments and occupations and more accent will be placed on inducements designed to promote inventions ( Milkovich et al, 2007 ). A cost film editing concern scheme will concentrate on efficiency and making more with less. To back up the concern scheme, the compensation policy will concentrate on rival ‘s labor costs, variable wage will be increased and productiveness will be emphasised ( Milkovich et al, 2007 ). A company with a customer-focused concern scheme will concentrate on delighting clients and employees will be paid harmonizing to how good they do this. The compensation scheme will therefore include client satisfaction inducements ( Milkovich et al, 2007 ). In order to make better than its rivals, a house must come up with ways in which it can add value by fiting its concern and wage schemes. When concern schemes change, pay systems must besides alter ( Milkovich et al, 2007 ). Organisations want to see the returns that they are acquiring from paying inducements, benefits and even basal wage.

Companies are get downing to gain that by sharing in the economic additions of accomplishing marks, they keep employees motivated to make progressively hard ends. When there is a clear line of sight between work and wages, employees will work harder to accomplish the ends and have the wagess ( Ulrich, 1997 ). It has been suggested that ‘performance-based wage plants best when there is success to portion ‘ ( Milkovich et al, 2007: 54 ). An administration can pay larger fillips and stock awards when their net incomes or market portion is on the rise. By paying fillips reasonably, employee attitudes and work behaviors better, which in bend improves their public presentation ( Milkovich et al, 2007 ). One of the major challenges in pull offing entire compensation is to understand how the wage system can add value and make a more successful administration.

Internal alliance

‘Internal alliance refers to comparings among occupations or accomplishment degrees inside a individual administration. Jobs and people ‘s accomplishments are compared in footings of their comparative parts to the administration ‘s concern aims ‘ ( Milkovich et al, 2007: 19 ). Internal alliance is non merely concerned with the wage rates for employees making equal work, but besides for those employees making different work. One challenge that directors face is how to find differences in wage for people making different work ( Milkovich et al, 2007 ).

An employee ‘s determination ‘to stay with the administration, to go more flexible by puting in extra preparation, or to seek greater duty ‘ is influenced by the wage that they receive ( Milkovich et al, 2007: 19 ). A compensation system should non stand in the administration ‘s manner of retaining talented and productive employees. One of the chief causes of employee turnover is unequal compensation ( Grobler, Warnich, Carrell, Elbert & A ; Hatfield, 2006 ). Tensions will ensue if employees feel that they are non being treated every bit and this may do employees to ‘reduce their hereafter attempts, alter their perceptual experiences sing wagess for their attempts or go forth the administration ( Grobler et al, 2006 ).

Management ‘s end is to understate turnover and lost production due to experience among employees that they are non being compensated equitably. In order to guarantee greater equity among occupations, a procedure known as occupation rating may be embarked upon, whereby a systematic relationship between the wage graduated tables for occupations within an administration is created. ‘Job rating is the systematic finding of the comparative worth of a occupation within the administration that consequences in an administration ‘s wage system ( Grobler et al, 2006: 404 ).

When comparing occupations, the undermentioned factors are taken into history: the accomplishments needed to finish the occupation, the attempts needed to execute the occupation, the duties of the occupation holder, and the on the job conditions of the occupation ( Grobler et al, 2006 ). Job rating is preformed in order to develop a system of compensation that employees will see to be just, and in this manner internal consistence among occupations is obtained. Internal consistence therefore refers to the relationship between the wage construction, the design of the administration and the work ( Grobler et al, 2006 ). It is of import to plan a wage system that ‘supports the work flow, is just to employees and directs their behaviors toward administration aims ‘ ( Grobler et al, 2006: 404 ).

Many administrations are spliting their employees and making different compensation programs for the different employee groups. For illustration, the executive squad will be compensated one manner, while a different attack will be used for the gross revenues squad, and yet another set of regulations will use to those working in the admin section. In today ‘s concern environment, a one-size-fits-all attack is no longer effectivity ( O’Connell, 2007 ).

Compensation methods have undergone a figure of alterations over the old ages such as ‘the usage of public presentation wage and other contingent systems of wages, the flattening of wage graduated tables with fewer but broader wage classs and flexible cafeteria-style benefit systems ‘ ( Brewster, Carey, Grobler, Holland & A ; Warnich, 2008 ). This new attack to compensation is known as strategic wage and is much more suited to today ‘s altering organizational environments and constructions. Strategic wage flows from and implements an administration ‘s concern scheme. The old methods of compensation were associated with ‘job-evaluated wage constructions, clip and senior status ‘ ( Brewster et al, 2008: 188 ). These old methods were appropriate for hierarchal administrations who operated in a stable environment.

Internal wage constructions must be designed in such a manner that employees will be motivated to accomplish the administration ‘s aims. There must be a clear line-of-sight between each occupation and the aims of the administration. It is besides indispensable that the construction is just to all employees ( Milkovich et al, 2007 ). To actuate employees, direction can construct the undermentioned thoughts into their strategic wage construction: ‘increase the proportion of wage contingent on public presentation, increase the authority of variable wage by doing base wages merely reasonably competitory, broaden the scope of incentive strategies to include associating wage to group and organizational public presentation every bit good as single public presentation, place new public presentation steps of concern success, and present flexibleness into compensation programs so that wagess extend beyond pecuniary 1s to include awards and acknowledgment ‘ ( Brewster et al, 2008: 188 ).

Pay constructions vary among administrations depending on the figure of degrees within the administration, the wage derived functions between the degrees, and the standards used to find the degrees and derived functions i.e. work content and its value. Peoples are normally paid more if their occupation requires more cognition or accomplishments than another occupation, if their working conditions are unpleasant, or if their occupation adds a great trade of value. One ground for wage derived functions is to actuate employees to work towards publicity and a higher-paying degree ( Milkovich et al, 2007 ).

Internal constructions are shaped by both external and organisation factors. External factors include: ‘economic force per unit areas ; authorities policies, Torahs and ordinances ; stakeholders ; and civilizations and imposts ‘ ( Milkovich et al, 2007: 75 ). Administration factors include: ‘strategy ; engineering ; human capital ; HR policy ; employee credence ; and be deductions ‘ ( Milkovich et al, 2007: 75 ).

With respects to economic force per unit areas, ‘one occupation is paid more or less than another because of differences in comparative productiveness of the occupation and differences in how much a consumer values the end product ‘ ( Milkovich et al, 2007: 76 ). It will merely be worthwhile to use an extra worker if they can bring forth a value equal to the value of their pay. This is referred to as fringy productiveness ( Milkovich et al, 2007 ). The supply and demand for labour, merchandises and services all affect internal constructions. Administrations are invariably forced to redesign their work flow and employees must continuously larn new accomplishments in order to maintain up with alterations in rivals ‘ merchandises and clients ‘ gustatory sensations. ‘Unpredictable external conditions require wage constructions that support nimble administrations and flexible people ‘ ( Milkovich et al, 2007: 76 ).

Government policies, Torahs and ordinances besides have an impact on the internal wage construction. Our jurisprudence gives everybody the right to fair compensation. This is besides known as the right to a life pay. Laws have besides been put in topographic point to regulate minimal rewards ( Brewster et al, 2008 ). Pay-related statute law attempts to accomplish societal public assistance aims by modulating economic forces ( Milkovich et al, 2007 ). The authorities has influenced compensation ‘by passing wage degrees, hours of work, wage for overtime and vacations and non-discriminatory wage patterns ‘ ( Grobler et al, 2006: 187 ). The Basic Conditions of Employment Act has a direct impact on a company ‘s compensation scheme.

Unions, shareholders and political groups besides influence the internal wage construction. In order to advance solidarity among members, brotherhoods by and large prefer little differences among occupations and seniority-based publicities. Stockholders compare the wages paid to executives with the wages paid to others in the administration. Stockholders are interested in this difference ( Milkovich et al, 2007 ).

If the wage construction is non aligned to the administration ‘s scheme it can go an obstruction to the accomplishment of the administration ‘s ends. Another factor that has an impact on internal constructions is human capital. Human capital refers to ‘the instruction, experience, cognition, abilities and accomplishments required to execute the work ‘ ( Milkovich et al, 2007: 78 ). The engineering used will act upon the organizational design, the work that needs to be performed, and the accomplishments or cognition that is needed to execute the work ( Milkovich et al, 2007 ). The administration ‘s other HR policies besides have an impact on the internal wage construction.

The more degrees an administration has, the more publicities it can offer, but the wage differences between the degrees may be smaller. It is believed that when publicities take topographic point frequently, even if they do non include wage additions, employees develop a sense of calling advancement ( Milkovich et al, 2007 ). Some companies develop endowment from within the administration. This besides serves to retain top endowment. These campaigners are promoted when occupation vacancies arise. The consequence is that they do non hold to use expensive endowment from outside the administration. It is besides easier to pull off these persons as they are already aligned with the civilization and concern precedences of the administration. This leads to a greater return on the company ‘s investing ( Barnes, 2009 ).

Another of import factor act uponing the internal wage construction is whether or non the employees involved accept it. In order to measure the equity of their wage, employees compare the wage that they receive to that which others receive for making different occupations in the same internal construction. They besides look at what others are paid for making the same occupation at viing employers ( Milkovich et al, 2007 ). The processs for finding the wage construction must be just every bit good as the wage construction itself. It has been suggested that employees and directors will accept low wage if they believe that the manner in which the wage was determined is just. It is likely that the wage processs will be considered just ‘if they are systematically applied to all employees, if employees participated in the procedure, if entreaties processs are included, and if the informations used are accurate ‘ ( Milkovich et al, 2007: 80 ). Pay constructions do non remain changeless. They change in response to external factors.

An administration will accomplish much better consequences if the construction is aligned. The construction must be perceived as just by the employees and it must actuate them to accomplish the administration ‘s ends. If there is a large wage derived function between an entry degree occupation and the highest degree occupation in an administration, it can promote employees to remain with the employer and increase their preparation and experience. It can besides ensue in greater co-operation with colleagues and for employees to look for more duty within the administration ( Milkovich et al, 2007 ).

External fight

External fight refers to the degree of wage that an administration offers in comparing with its rivals ( Montemayor, 1996 ). This has a immense impact on the attractive force and keeping of endowment every bit good as on labor cost aims. With a high wage degree, the administration will be better able to get a competent work force. By increasing the wage degree, entire labor costs will increase but it may besides ensue in improved labor costs per unit ( Montemayor, 1996 ). The efficiency pay theory provinces that ‘paying above market degrees can advance employee motive that would countervail any increase in labor costs ‘ ( Montemayor, 1996: 891 ).

The wage systems of many administrations are market-driven i.e. based on what rivals pay. In the hope of pulling the best appliers, some administrations set their wage degrees above that of their rivals ( Milkovich et al, 2007 ). In order to vie with the external market, administrations must guarantee that the wage that they are offering is sufficient to pull and retain employees. Employees are likely to go forth an administration if they believe that their wage is non competitory in comparing to what other employers are offering. Administrations must besides guarantee that they control their labor costs so that they can provide their merchandises and services at a good monetary value and stay competitory in the planetary economic system ( Milkovich et al, 2007 ). It is indispensable that when companies prepare their concern schemes they decide how they are traveling to vie in the market place. For illustration, they can take to vie on monetary value, or they may prefer to distinguish themselves based on merchandises or services, they could even make up one’s mind to section the market and merely concentrate on a peculiar group of purchasers. Understanding the competition is cardinal ( Kaplan, 2007 ).

Employers can break distinguish themselves from their competition by presenting acquisition and development plans and making a merriment and flexible work environment. These are besides known as relational wagess. These enterprises will heighten employee committedness to the administration ( Kaplan, 2007 ). Employers that are highly-rated normally receive more employment applications as people want to work for the best administration. The high evaluations besides result in improved keeping of staff and greater profitableness as committed employees normally provide better client service ( Kaplan, 2007 ).

Job appliers who receive more than one offer will compare the offers and the wage graduated tables. More weight is frequently placed on the salary being offered instead than on the other types of compensation, like benefits and intrinsic wagess ( Grobler et al, 2006 ). In order to stay competitory within the local labor market, employers normally offer wages that are similar to those offered by rivals. Employers therefore need to cognize what the traveling rate is for occupations within the local labor market. Engage studies every bit good as published market informations can be used to find the mean wages for assorted places. These methods assist the administration in keeping external consistence with other administrations ( Grobler et al, 2006 ).

An of import strategic determination must be made as to whether the administration should mirror what its rivals are paying, or whether it should plan its ain wage construction that differs from its rivals but is aligned to the concern scheme. The wage degree can be set above, below or equal to that of rivals. The mix of wage signifiers must besides be determined comparative to those of rivals ( Milkovich et al, 2007 ).

The undermentioned three factors shape external fight: labour market factors, merchandise market factors and administration factors. Together these factors influence pay-level and pay-mix determinations ( Milkovich et al, 2007 ).

As mentioned above, administrations normally claim to be market-driven. Looking at the demand and supply of labour gives one a greater apprehension of how the markets work. The demand side trades with the actions of the employer i.e. the figure of new employees they require, and what they are willing and able to pay them. The supply side trades with the possible employees i.e. their makings and the wage that they are likely to accept ( Milkovich et al, 2007 ). The market rate is found at the point where the demand for labour meets the supply of labor.

In the short tally, the lone manner that an administration can alter its degree of production is by altering its degree of human resources. The other factors of production, such as engineering, capital and natural resources are fixed in the short tally. ‘The fringy merchandise of labor is the extra end product associated with the employment of one extra individual ‘ ( Milkovich et al, 2007: 207 ). However, each extra employee hired will bring forth less than the old employee due to the fact that the factors of production are fixed. Each employee therefore has fewer resources to work with. The extra sum that each new employee green goodss is known as the fringy merchandise ( Milkovich et al, 2007 ).

When the fringy merchandise is sold, the money that is generated from the sale is known as fringy gross. Employers will engage new staff until ‘the fringy gross generated by the last hire is equal to the costs associated with using that individual ‘ ( Milkovich et al, 2007: 208 ). At this point the employer is maximizing their net incomes. Therefore, in order to find how many people to use, a director must set up two things: the wage degree that is set by the market forces and the fringy gross generated by each new employee ( Milkovich et al, 2007 ). This, nevertheless, is non so easy to make in world.

With respects to labor supply, ‘the theoretical account assumes that many people are seeking occupations, that they possess accurate information about all occupation gaps and that no barriers to mobility exists ‘ ( Milkovich et al, 2007: 209 ). It is non so simple in the existent universe. For illustration, the supply curve slopes upward and shows that as wage increases more people will desire to take occupations. In the instance where unemployment is really low, supply may non increase with offers of higher wage as everybody has a occupation ( Milkovich et al, 2007 ). The theoretical account provides a utile analytical model but oversimplifies world.

In certain cases employers pay more than the market-rate. For illustration, if there are negative elements to a occupation such as really expensive preparation, little opportunities of success, weak occupation security and unpleasant on the job conditions, employers may make up one’s mind to pay higher rewards in order to counterbalance for the negative features. This is referred to as counterbalancing derived functions ( Milkovich et al, 2007 ).

As mentioned above, in footings of the efficiency pay theory, high rewards can in fact addition efficiency and lower labor costs. This can be achieved by pulling more qualified appliers and promoting bing employees to work harder or smarter. It is assumed that the wage degree determines attempt ( Milkovich et al, 2007 ). An administration ‘s ability to pay is besides an of import issue. The greater an administration ‘s net incomes in comparing with its rivals the more it is able to portion with its employees. These administrations will normally pay more that their rivals and may even pay fillips in line with their profitableness ( Milkovich et al, 2007 ).

Employers can plan their wage degrees and mix in such a manner that a signal is sent to both current and future employees as to the sorts of behaviors that they require. This is known as signaling. For illustration, if the administration ‘s base wage is below the market-rate but they offer good fillips, they may be directing a signal that employees who are risk takers are required. If the administration pays the market pay and offers no performance-based wage, a different signal is sent and different people are attracted. Signing helps to pass on outlooks ( Milkovich et al, 2007 ).

There are besides two theories that help us to understand employee behavior. A occupation searcher will non accept a occupation offer if the pay is below a certain sum irrespective of the other benefits or occupation properties. This is known as the reserve pay. It may be above or below the market-rate ( Milkovich et al, 2007 ).

The 2nd theory is the human capital theory. In footings of this theory, those who have improved their productive abilities by puting in themselves through instruction, developing etc will gain higher rewards ( Milkovich et al, 2007 ).

The following factor that shapes external fight is the merchandise market and ability to pay. To a big extent, merchandise market conditions determine what the administration can afford to pay its employees. The administration ‘s ability to alter what it charges for its merchandises and services is affected by the demand for the merchandise and the sum of competition ( Milkovich et al, 2007 ).

An employer who increases their pay degree will either take to increase its monetary values, thereby go throughing the higher labor costs on to consumers, or it can take to maintain monetary values fixed and pay the increased labor costs out of their grosss. If an employer is runing in a really competitory market they will non easy be able to increase monetary values ( Milkovich et al, 2007 ).

Last, administration factors include features that are alone to each administration and their employees such as: industry and engineering, employer size, people ‘s penchants and organizational scheme ( Milkovich et al, 2007 ).

‘The industry in which an administration competes influences the engineerings used ‘ ( Milkovich et al, 2007: 216 ). Lower rewards are paid in labor-intensive industries than in technology-intensive industries. When new engineering is introduced within an industry, wage degrees are besides affected ( Milkovich et al, 2007 ).

Large administrations by and large pay more than little 1s. In large administrations, talented people have a greater fringy value as they are able to act upon more people and determinations ensuing in larger net incomes for the administration ( Milkovich et al, 2007 ).

‘Better apprehension of employee penchants is progressively of import in finding external fight ‘ ( Milkovich et al, 2007: 217 ). It is, nevertheless, hard to mensurate penchants. It has been found that wage is more of import to people than they are willing to acknowledge ( Milkovich et al, 2007 ).

With respects to administration scheme, some employers compete by following a low-wage, no services scheme. These administrations, such as Nike and Reebok, frequently rely on outsourcing to fabricate their merchandises. Other administrations may take a low-wage, high services scheme or even a high-wage, high services attack ( Milkovich et al, 2007 ). Employers will pay more than their rivals if the occupation has a direct impact on the success of the administration. Pay degrees will be that of rivals in occupations that have less of an impact on the success of the administration. Evidence shows that those administrations with higher-skilled workers who make usage of high-performance work patterns and computer-based engineering besides pay higher rewards ( Milkovich et al, 2007 ).

The integrating of internal alliance & A ; external fight

In order for a compensation scheme to be successful it must intermix internal consistence with market fight, and must be structured to recognize the certificates, cognition and public presentation of the persons involved ( Martocchio, 2001 ). ‘An appropriate compensation policy is designed around the organizational construction, competitory place, leading manner and the strategic program of the administration ‘ ( Santone, Sigler & A ; Britt, 1993: 86 ).

A mentioned above, one of the chief causes of employee turnover is unequal compensation. ‘The fight of wage will impact the administration ‘s ability to accomplish its compensation aims, and this in bend will impact its public presentation ‘ ( Milkovich et al, 2007: 221 ). It is common for administrations to fit the rates paid by their rivals. If administrations fail to make so, the bing employees will be unhappy and the administration ‘s ability to enroll will be limited ( Milkovich et al, 2007 ). Such a policy will ensue in the administration ‘s pay costs being similar to that of its merchandise rivals and the administration ‘s ability to pull new employees will therefore besides be similar to its labour market rivals ( Milkovich et al, 2007 ).

Job rating, whereby the worth of a occupation within an administration is determined, is performed in order to develop a system of compensation that employees will happen just. In this manner, internal consistence among occupations is obtained ( Grobler et al, 2006 ). However, if a rival is willing to pay an employee a higher pay to make the same work, the employee will go forth their current occupation to gain better wage elsewhere. An employer must therefore non merely see what they are willing to pay for a peculiar occupation but besides what the rivals are paying for the same occupation. This is of import if they want to pull and retain choice workers.


It is of import that companies guarantee that their wages systems are aligned with their organizational ends, scheme and civilization. Strategic compensation allows for employees to gain inducements if they accomplish company ends. Compensation has a immense consequence on recruiting, retaining and actuating people. The compensation scheme of an administration besides has a direct impact on its public presentation. Internal alliance and external fight should be integrated when organizing the wage construction.


Core scheme inside informations


Severe acute respiratory syndromes


-Attract and retain high quality persons with the optimal mix of accomplishments, competences and values.

-Motivate and reinforce superior public presentation.

-Encourage the development of accomplishments and competences required to run into current and future aims.

-Employees should portion in the success of the concern.

-Drive productiveness, service quality and cost efficiency.

-Enable employees to execute at their extremum.

-Build a accomplishments inflow through the alumnus and young person enlisting programme.

Internal alliance

-Remunerate people reasonably and systematically harmonizing to their part.

-Ensure that employees of equal value are remunerated more or less every bit.

-Parity in the immediate environment is the most of import.

-Fair wage.

-Recognition system.

-Employee development.

-Talent direction.

Externally competitory

-Set cost to company ( CTC ) at the market median.

-Reads the market on a regular basis to strategically place itself at mid-market for fixed wage bundles with distinction between employees via variable wages programmes.

-Differentiates sharply between degrees of public presentation.

-Emphasis on variable wage i.e. inducement and committee strategies.

-Incentive system in topographic point.

Employee parts

Direct wagess ( criterion ) :

Fixed wage ( CTC ), allowances, overtime, leave encashments, variable/ public presentation based wage ( long and short-run inducements ).

Direct wagess ( non-standard ) :


Indirect wages:

Recognition wagess ( prestigiousness awards, service heroes, long service awards ). Bursaries for employees and employee dependents. Benefits: free banking, staff involvement rates, disablement support fund, leave.

-Fixed wage, allowances.


-Government subsidies.

-Incentive wage.


-Open and crystalline communicating.

-Objective wage determinations.

-Show echt attention and concern.

-Create an enabling environment.

Rewards/ compensation strategic map


Aims Attraction and keeping

Superior public presentation

Quality service Please see attachment

Internal alliance for graph.

Fair wage

Employee development



Variable wage

Market analysis

Level of wage

Employee parts


Direct wagess

Indirect wagess







Severe acute respiratory syndromes

Relevant reward/ compensation scheme



Severe acute respiratory syndromes




Cost-cutter: Focus on efficiency

-Competitors ‘ wage taken into history through market analysis.

-Pays mid-market degrees for fixed wage.

-Emphasis on public presentation.

-Variable wages programmes.

-Huge focal point on acquisition and development.

-Driving employee committedness.

-Create an environment that enables employees to execute to the best of their abilities.

-Build a civilization of accomplishment, acknowledge exceeding public presentation and observe single and organizational success.

Customer focused

-Indirect wagess eg. Service hero awards encourage employees to supply first-class client service.

-The immense focal point on acquisition and development will ensue in more competent staff and hence happier clients.


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