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Wrap it up

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About HR Strategy about Compensation

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Wrap it up

  1. 1. Presented By : Monica Singh - 13810052 Amar Keshari - 13810008 Rakesh Ranjan - 13810066 Shivani Singh - 13810072 Wrap It Up Developing a new Compensation Plan
  2. 2. Introductio n Proble m Statem ent ShareI t Propo sed Soluti on
  3. 3. Background  Shawn Jackson and Simon Sethi  Northern California, 2002  Fresh, healthy, locally sourced ingredients  Consumer preference of quick meal alternatives  30 restaurants by 2011  Focus on freshness and special diets  All stores company-owned  Passion for delivering fresh quality food
  4. 4. Concerns  Tight relationships with long term employees  Centralized social media activities  Disorganized recruiting  High turnover  Difficult to attract and retain top talent  Lack of motivation among managers
  5. 5.  Frustration among employees at all levels  Declining customer satisfaction  No change in menu  Regular customers not given any discounts  Manager turnover  Inconsistency in menu and service due to local sourcing
  6. 6. Compensation It is what employee receive in exchange for their contribution to the organisation.  Nature of Compensation a. Base Pay b. Variable Pay c. Benefits  Dimensions of Equity in Compensation Planning a. Internal Equity b. External Equity c. Individual Equity
  7. 7. Objective of Compensation Planning  Attract Talent  Retain Talent  Ensure Equity  New and Desired Behaviour  Control Cost  Comply with legal rules  Ease of operation
  8. 8. ShareIt  For Individual store profits  Motivation for Managers  Store Selection for Pilot Program Comparative Analysis Store Name Santa Monica Costa Mesa Location New City Centre Shopping Mall Experience Opened in 2004 Opened in 2007
  9. 9. Employee Enfranchisement  Achieved through an integration of empowerment with methods of pay for performance .  Participatory management : Encourage employee to participate in organizational decision making.  Employees are encouraged to voice their opinions about their working conditions.  Such combinations have the potential for producing extraordinary service.
  10. 10. ShareIt Insights Existing Pay Structure ShareIt Structure Basic Pay: At Par with the Industry Profit = Performance Metric Variable: Differs w.r.t. amount and qualifiers Quarterly Appraisal Linked to Profits not Revenue 5 Bands : Revised on yearly basis Store Manager : 35% Profit No pay difference b/w top and low range of band Associate Manager : 15% Profit No incentive to improve after band is achieved WrapItUp :50% Profit Benefits were Paid one
  11. 11. WrapItUp Manager Compensation vs Industry Benchmark
  12. 12. Santa Monica Strategy  Setup a Facebook Page and Twitter account.  New Menu was designed – “ RepeatIt”  Offered discount coupons  Chef appearances and book Signing Costa Mesa Strategy  Focused on Cost Reduction  Renegotiated terms with suppliers  Substituted with less expensive ingredients
  13. 13. Income Statement of Costa Mesa Store before ShareIt
  14. 14. Income Statement of Costa Mesa Store during ShareIt
  15. 15. Income Statement of Santa Monica Store before ShareIt
  16. 16. Income Statement of Santa Monica Store during ShareIt
  17. 17. Customer Surveys Report
  18. 18. Outcomes Of Steps Taken Parameters Santa Monica Costa Mesa Revenues Increased by 10.2% Decreased by 1.45% Profitability Increased by 24.5% Increased by 21.8% Working hours Increased from 50hours to 70 hours a week - Customer surveys Mixed results Downgraded customer satisfaction
  19. 19. Solutions  Based on these points we observe that the result of the programme showed improvement in profitability. Stores have been able to increase their profits and have been able to increase the incentives for managers.  However we opine that the cost containment approach adopted by the manager at Costa Mesa would not sustain in long run and would lead to customer dissatisfaction.  The employee turnover is bound to increase in this scenario. We recommend the customer centric
  20. 20.  The promotions and new menu items introduced would add value to customer satisfaction.  The idea of taking orders through text messages would further help the store to retain its customers.  Better customer relationship program should be introduced. There is no such mention in the case that how the employees should be motivated other than giving improved incentives.  Rework on the compensation plan
  21. 21.  There should be some metrics to measure the employee satisfaction level also. This can lead to have better satisfied pool of employees which in turn would yield high profitability with improved customer satisfaction.  Reyes should roll out the programme in some other stores to evaluate how other store managers would react to the combination of freedom and pressure that ShareIt program offers.  Include multiple parameters like revenue and size of
  22. 22. Thank You

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