Evaluating Compensation Strategies Essay Example for Free

Evaluating Compensation Strategies Essay Within this business report, I have analyzed three different employee compensation strategies that I feel could be well executed within our organization. Employee compensation is key to recognizing and rewarding our employees for their performance and contributions to the overall company’s success. Because it is a signficiant factor, we need to carefully evaluate the three options in my report. Compensating our employees using the base salary approach is a well accepted strategy. This approach provides for a set salary that employees will earn based on their job coding. Factors such as merit or tenure will have no impact on someone’s base salary. This is a stable compensation strategy leveraged within similar organizations and an approach most employees feel comfortable with as it’s very cut and dry. The downside of using this approach is that there is little room for growth and salary increases and which can be de-motivating. Performance-based compensation is quite a popular and also another well accepted strategy. In this strategy, employees have direct control over how much they are paid. Having control really helps to motivate employees to work harder and achieve new financial goals and maximize their own income. Having an organization that is a high performing organization helps to make an organization more competitive. The downside of this approach is that you create a more competitive environment that may impact employee-to-employee relations. Lastly, I reviewed a longevity-based salary strategy. In this strategy, compensation is strictly based on an employee’s length of service, seniority or tenure. There are different ways this pay can be administered. Employees can get an annual bonuses based on their employment anniversary date or monthly bonus amounts added to their take-home pay that would reflect their length of service. This type of strategy encourages employees to remain loyal employees in an organization. The immediate downside to this approach is that employees aren’t motivated to achieve more or produce increased quality work since it’s more about time put in vs. quality. After reviewing the three strategies outlined above, I am recommending that we move forward and implement a performance-based compensation strategy for our employees. This strategy will create a workforce of highly motivated, performers that are excited and engaged to succeed. Employees will be excited to ramp up their income and their excitement and achievements will help support the company’s goal of increased profit. If our company has highly driven employees focused on producing quality work, the company will benefit in the short term and long term. Introduction The Human Resources department was asked to research possible compensation strategies for our manufacturing organization. I’ve created a report that shares my research and findings for three different compensation strategies: Performance-Based Compensation, Salary Compensation and Longevity Compensation. In my report, I have compared these strategies, pointing out where they are different including the pros and cons to each strategy in order to determine the best approach for the 120 total employees on our payroll. Compensation is a key factor that impacts employee satisfaction while also having a direct influence on how successful the overall organization can be. I’ve conducted thorough research on this topic so that the management team can have a more robust understanding of these three strategies and to decide on a strategy to implement. My research below will start with salary compensation which can easily be defined as a set monetary amount that an employee receives for the work that they do based on their specific job classification/coding only. I’ll follow that with performance-based compensation which pays and rewards employees based on their individual performance which allows for individual growth. Lastly I’ll provide research on longevity pay which focuses on additional pay or wage adjustments based solely on an employee’s length of service. It is crucial to understand each of these strategies and how they will impact our organization if they were to be implemented. Research Findings I’ve completed extensive research on various compensation strategies within similar types of organizations and have arrived at three specific strategies that our organization should consider adopting:  ·Salary Compensation  ·Performance-Based Compensation  ·Longevity-Based Compensation 1.Salary General salary compensation refers to an amount of money that you pay an employee for the work they do without consideration for quantity or quality of the work performed (Entrepreneur Media, Inc., 2013). By law, employers must compensate employees for work that is completed. If an employee is compensated by a salary, employees are compensated differently from those that may have an hourly compensation rate. Employees that are hourly employees get paid based on a rate multiplied by the number of hours that they work. When they work over and above the amount of hours for the day/week, they receive extra, additional compensation (Grace, 2012). In contrast, a salary compensated employee gets paid the same salary, a fixed amount of money and is not impacted by the amount of hours an employee works. Salaried employees are not required to keep track of the hours they are working because they do not quality for nor are they paid for any overtime. They are expected to complete their work regardless of the amount of time it takes them. Employees who are paid a salary are given the expectations that they need to complete the entire job in order to earn their compensation. This compensation differs from both hourly paid employees or performance-based paid employees. Employees are able to really count on this compensation and a consistent pay strategy is important to retaining good employees (Ojimba, 2004). Analysis Employees that are compensated through a salaried compensation strategy have a very stable compensation to rely on. There are no real surprises or swings in the amount of money an employee receives. Compensation is not impacted by the quality of the work produced or the quantity produced. Employees would have the opportunity to budget themselves or at least have a decent time predicting what type of income they can expect since it will always be the same without much changing from year to year. This strategy may allow for employees to develop the impression and mindset that they don’t have to do more or produce increased quality work. They could take away that what they are doing today is enough and not strive to help the company with increase sales or various other goals. 2.Performance-based A performance-based strategy is become a trend in today’s organizations and leveraged as a way to incent employees to strive to increase their production or improve the quality of their work. Why would an employee want to do that? Because they are financially incented to do so! All companies need to remain competitive and control internal costs and budgets. Performance-based compensation really partners with an organization to do just that. This type of strategy is really attractive because they are friendlier to corporate budgets than other methods of compensation. Pay increase are only given out at designated times during the year so budgeting in advance is easier, etc. If production and quality goals aren’t met, money goes back into the budget for the next possible review period (Fox Lawson Associates, n.d.). Additionally, strategy helps to provide a win-win situation for both the company and the employees when properly administered and rolled out and the structure really can help to motivate employees to work harder and that benefits them and the company both. When developing this type of strategy, reasonable goals and performance incentives would need to be developed. In today’s environment it would be wise to tie pay to performance as a way to accelerate employee output. This approach is a very common way for organizations to increase productivity and influence potentially a more competitive environment with employees always striving to do more and therefore earn more. Performance-based compensation programs also help retain top performers, better align labor costs with productivity and reinforce the company’s objectives (Richter, 2002). You attract a different level of employee with this approach. For employees to be successful and feel happy in this type of structure though they need to have a desire for more pay, have confidence they will receive more pay if they improve or increase their individual performance and trust that the organization will administer the policy and compensation plan fairly across the board. Studies have consistently shown the recognition for a job well done is the top motivator of employee performance (Dorf, 2011). Analysis Though research it is clear that this type of approach includes many benefits both to the employee and to the organization. Creating a more motivated workforce that is focused on a goal to provide quality production benefits everyone. If our employees can see that their performance directly impacts their personal bottom line they will become more focused, work harder and constantly push their peers to meet them at that level. Job security has to be considered here too – a company with this type of approach is more streamlined and efficient creating a more competitive organization and helping to protect and preserve the company and its reputation. 3.Longevity-based Longevity-based compensation is a compensation strategy that more mirrors a type of contract where the employer will pay the employee a compensation based on their length of service or seniority. In researching this approach, many companies offer many different types of strategy around this. Each organization up front provides a document or â€Å"contract† to the employee that outlines this system specific to their organization. These types of documents include things like the dollar amount to be paid or the percentage of increase based on years of service. Information is also included on the schedule of payment so that employees really know what to expect. Employees see this type of strategy as a way of paying for their loyalty as an employee – a way of giving them their due for sticking with them (wiseGEEK, n.d.). Typically with this approach the adjustment made is often in the form of a percentage of the employee’s annual salary or rate of pay. Based on why the amount is given it becomes clear that an employer is recognizing their time and loyalty to the overall organization. The real problem with this specific approach is that you essentially are awarding someone just for being on staff or holding down their position for yet another year (Agency Management Roundtable, 2012). Analysis – I think this type of compensation program may have made sense for employees that may be â€Å"Baby Boomers† as loyalty was crucial and something employees really set out to demonstrate, but not something that is realistic in today’s environment. While rewarding employees for their â€Å" time served† there is no real focus on the quality of their work during that time nor is there any reward for their contributions or added value.

Heroes (my Parents) :: essays research papers

When one thinks of heroes, names such as Ghandi, Martin Luther King, and Mother Theresa often come to mind. These people had done a lot of favors, courage, helps, and more of things for the people who needed them. They have change the world. But, heroes can be in anyway, even in each of individuals in the world. I have the persons who I think is the best hero in my mind. They are my parents.   Ã‚  Ã‚  Ã‚  Ã‚  My parents are brave; they will do anything for my happiness. Not only mine, but also their friends, and families. My father has many friends, and he always helps them whenever they need them most. Without my parents, I probably will not survive. Heroes usually best described as selfless, brave, and often inspiring. A friend of my mother just heard a bad news from her family back in Indonesia, telling that her father has a cancer that already spread in his body. She has to go back and visit her father, but can't afford the plane ticket. My mom not hesitantly let her borrow her money for the ticket. During The May riot in Indonesia, everybody in my complex tried to run away since the natives were going to kill the Chinese. But, My father and couple of his friends ordered them to stay and fight back, and it worked. The natives ran when they saw a crowd of Chinese trying to kill them back. My parents are the most inspiring people for me. They taught me things that I need to know like drugs, and other important things. My father always inspired me to do the right things, to be strong, and be independent. I am sure that all parents that did a lot of things for their children are heroes.   Ã‚  Ã‚  Ã‚  Ã‚  Heroes always change in our mind as we grow. As a child, we think Hercules, Xena, superheroes, imaginary friends, comics', and cartoons' heroes as the real heroes. As we grow older, our opinions keep changing from time to time.

Economics †Puerto Rico Essay

In this paper will identify, describe and production costs of the Company San Juan Cell Phones compares. In turn, the potential risks are identified in making management decisions. In addition, will analyze and assess what are the best ways to prevent negative consequences for the company. The term cost refers to the amount or representing a product or service according to investment in material, labor; training and time that you need to develop it. As you can see, the term is characteristic and central to economics as it is the point at which any part of trade or economic relationship between two parties. The cost is to be paid by those who want to receive a product or service to have it in his possession or under his control. Today, the cost of a product or service is expressed in most situations in terms of money or capital (which may itself vary currency according to the region or area in which the exchange takes place). However, in antiquity and long, humanity carried on their t rade and economic exchanges through the delivery of other items such as spices. The cost of the products is then provided to the equivalent cost for a given quantity of spice. Economic Costs According to McConnell & Brue (2008), Economic costs include all payments that must be received by resource owners to ensure a continued supply of needed resources to a particular line of production. Economic costs include explicit costs, which flow to resources owned and supplied by others, and implicit costs, which are payments for the use of self-owned and self-employed resources. One implicit cost is a normal profit to the entrepreneur. Economic profit occurs when total revenue exceeds total cost (= explicit costs + implicit costs, including a normal profit).  Differentiate between short-run costs and long run depending on use of whether variable or fixed productive factors. In Short-run costs: have fixed and variable inputs. Therefore, variable and fixed costs will be. Within the short-run costs are: Total Cost is the market value of all inputs used to produce a product. It has 2 components: fixed and variable costs: (1) is determined and unchanging value that is independent o f production volume, are those costs always exist e.g. rent, electricity, etc. (2) A Variable cost is a cost that is incurred depending on the volume of production, human cost (work) and commodities. (3) The marginal cost is the change experienced by the total cost when an additional unit increases production. Grows in contrast to the marginal productivity sense, if it grows, the marginal cost decreases. In Long-run costs: there are only variable costs. In the long run, firms have no fixed costs are all variables that the factors of production are thus the total cost, which is equal to the variable costs. The curves in the long-run costs, they say to each output, with the lowest cost that can be obtained, assuming all inputs vary. The curve means short-run costs will be tangent to the long-run average costs. The total long-run cost is equal to all the variable costs of the company. Some of the reasons why the average total cost curve to be increasing, stable or declining: (1) the means and long-run marginal costs, like a â€Å"u† because it produces income production. (2) When yields are constant output grows proportional / the increase factor, and average costs are constant. (3) When yields are rising, the long-term costs decrease. (4) When yields decrease long-term costs are rising. (5) Normally the company began taking increasing returns but as the situation is complicated diminishing appear. Overall yields are mixed. San Juan Cell Phone Scenario This scenario presented the actual dilemma of company San Juan Cell Phone in Puerto Rico. In this scenario the production manager need to analyze the potential risks, consequences positive or negative and possible solutions; of accepting the order of 100,000 units of cell phone of the company â€Å"Big Box† and accept or reject the external production of the cell by outsourcing, an external company called â€Å"Original Equipment Manufacturer†. In order to make a recommendation on what would be the best alternative for this scenario and to provide a solution that does not affect the company,  analysis and recommendations will be divided into phases. In the first phase will analyze the unit profitability report of San Juan Cell Phones, which is found in Table 1 in the statistical appendix of this document. This table shows that the company San Juan Cell Phones has a price per unit for the Alpha model for $ 20, of which the variable costs per unit are $8, fixed overhead s per unit are $ 9 and a profit per unit of $ 3. The company â€Å"Big Box† will not pay more than $ 15 per cell phone; which implies a loss of $ 5 dollars per unit price for San Juan Cell Phone. If we analyze the loss from the perspective of the total cost of production, San Juan Cell Phones would have a total loss of production of $200,000, even without adding that there was no profit from this production. This loss would lead to other serious problems to company profitability, which will be difficult to replenish in the short term because the equilibrium price in the market is $15. Therefore can notice an excess supply. San Juan Cell Phones must make a comprehensive analysis of their variable and fixed costs and trying to lower them to compete with the market price and maintain profitability. On the other hand, evaluating the offer that provides OEM to San Juan Cell Phones, where the price of production per unit is $14; we can see that San Juan Cell Phones could meet the production requested by Big Box and in turn obtain a profit of $100,000. This in turn allowing you to San Juan Cell Phone keeps the market equilibrium price of $ 15. Where the company can lower the current price per unit and maintain its excess demand in the market and maintain profitability. As part of this analysis shows that the grant to the outsourcing manufacturing, with the penalty would take to keep all their employees working and running the factory capacity. And therefore their bonus, which is based on the overall profitability of the company, is affected. Recommendations of best alternative solution In the second phase of this analysis will make the recommendations to follow to meet the expectations required by Bib Box, without loss of profitability, and to meet the value established by the company. Below the suggested recommendations: (1) Is to secure the order of 100,000 phones required by Bib Box. (2) Establish agreements with OEM outsourcing. In this agreement the Alpha prototype model and the quality of the prototype will be established, also limit the time of delivery and the amount of production is  settled. In turn, the price of $ 14 per unit, which is not negotiable, is settled. (3) Establish a plan for reengineering the organization structure, technology and the human factor in the production line of Alpha models as initial phase of the process. At a later stage the reengineering organization to another production line would be extended. Observe the appendix A: Guide for Strategic Planning and Organizational Reengineering. These recommendations are aimed to the San Juan Cell Phones company, can get the desired order to maintain profitability. In addition to be able to maintain its equilibrium price in the market, you can keep your excess demand, increase their volume of production and profits. In addition meet its corporate values ​​to provide its customers with high quality and exceed the expectations of them. Conclusion In the scenario presented the administrative task being viewed uncertain and challenging, as a number without variables, change and transformation is affecting it. It’s time for San Juan Cell Phones, perform an analysis of their strengths and limitations of your environment and make a formulation of strategic alternatives. This analysis will take the company to be more efficient and effective in meeting the needs of its consumers, taking into consideration an adaptability, a proactive character and flexibility to embrace change, in turn have a better interaction with new technologies and positive changes in the values ​​of corporate society attitude. Reference McConnell, C. R. & Brue, S. L. (2008). Economics: Principles, problems, and policies (17th ed.). Boston, MA: McGraw Hill/Irwin. Pugel, T. A. (2007). International economics (13th ed.). Boston, MA: McGraw Hill/Irwin. University of Phoenix. (2014). Student Resources. Retrieve from https://newclassroom3.phoenix.edu/Classroom/#/contextid/OSIRIS:46311129/context/co/view/activityDetails/activity/d547f818-bc95-4e40-b161-61f94462bdb7/expanded/False Statistical Appendix

Analysis of the Movie Parenthood - 705 Words

The movie Parenthood cover’s many of the topics we have discussed this semester in class. But it obviously focused very strongly on parenting and marriage. During the course of the movie we see the four Buckman children’s very different style of parenting. Although all four were raised by the same parents the culture of their individual families are all look very different. Gil Buckman felt abandoned and ignored by his father and therefore responded, with his wife Karen, by being a very active and attentive parent. Gil and Karen are on the authoritative end of the parenting spectrum, and their families’ culture revolves around activities such as baseball games, Kevin’s baseball game, Birthday parties, school plays and basically having fun together (Lecture, 4/22). On the opposite end of the parenting spectrum are Nathan and Susan. They are very authoritarian and reminded me of the â€Å"tiger Mom’s† of China. The culture of their family means that they don’t have their daughter in preschool, they are waiting a prescribed amount of time to have a second child and Nathan is continuously drilling facts into their daughter. Susan feels like she should be playing with children her own age but Nathan’s feelings have taken over their family’s culture. When Kevin starts having difficulties in school (these difficulties are not expanded on greatly) it begins to test Gil and Karen’s families’ culture and eventually their marriage. This structural issue causes Gil and Karen to doubt theirShow MoreRelatedMovie Analysis : The Movie Parenthood 856 Words   |  4 Pageschild, I was prone to think that my family had to be the only one with obstacles, although, this changed dramatically after I watched the movie Parenthood. 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