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Gmb 6070 session 6 - june 13th (fil eminimizer)


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Gmb 6070 session 6 - june 13th (fil eminimizer)

  1. 1. Session 6<br />Strategic Reward and Compensation Systems<br />13th June '11<br />1<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  2. 2. Presentation Plan<br />Deference between reward and compensation<br />Strategic importance of compensation system<br />Employee benefits and benefit programs<br />Job evaluation<br />Class group discussion tasks<br />13th June '11<br />2<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  3. 3. Remuneration System<br />Compensation<br />Reward<br />Usually money<br />Incentive to drive achievement<br />Given for special service<br />A satisfying return, result or profit<br />Gratify<br />It could also be something not given in retribution for inferior/evil activities<br />Is a money value given in exchange for work performed<br />Used to: <br />Attract and retain talent<br />Maintain morale or level of satisfaction<br />Encourage peak performance<br />Achieve equity – Internal/External<br />Encourage loyalty<br />Modify practices<br />13th June '11<br />3<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  4. 4. Pay Based Competences for HR<br />13th June '11<br />GMB6070 - SHRM FRANKFURTCLASS<br />4<br />Core Competencies<br />Technical competencies<br />Strategic Competencies<br /><ul><li>Change management
  5. 5. Guiding and Influencing
  6. 6. Project management
  7. 7. Strategic thinking</li></ul>Communication<br />Team work<br />Problem solving<br />Coaching/mentoring<br />Customer care<br />Integrity/Honesty<br />ICT Application<br />Leveraging diversity<br />Employee Benefits<br />Labour Relations<br />Job Evaluation<br />Searching, attracting and recruitment<br />
  8. 8. Strategic importance of compensation System<br />Recruit and retain qualifies employees.<br />Employer may need to adjust and respond to market forces.<br />Morale and job satisfaction are affected by compensation levels.<br />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.<br />Use it to recognize exceptional performance – bonus pay, commission, stock, profit sharing, gain sharing<br />13th June '11<br />5<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  9. 9. Ensuring balance and stability in reward and compensation<br />HRM should ensure:<br />Development of job descriptions for every job holder<br />Analysis of all jobs<br />Evaluation of all benchmark jobs<br />Banding, ranking and grading of all jobs<br />Frequent salary surveys <br />Development of policies, guidelines and other SOPs.<br />13th June '11<br />6<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  10. 10. Employee benefits and benefit programs<br />Base pay<br />Commissions<br />Overtime<br />Bonuses, profit sharing, merit pay<br />Stock options<br />Allowances: travel, meals, housing<br />Benefits: education, medical, insurance, leave, holidays, retirement, taxation<br />13th June '11<br />7<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  11. 11. Job evaluation<br />Determine relative worth of jobs in the organization<br />Verify by comparing with industry market data and adjust as may become necessary<br />Prepare a matrix organizational review<br />Prepare ranking<br />Prepare a matrix organizational review<br />13th June '11<br />8<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  12. 12. Establish jobs that cross lines and departments (matrix reporting)<br />Compare the matrix with data from both the company structure and the industry market realities<br />Prepare flow charts of all ranks for each department for ease of interpretation and assessment.<br />13th June '11<br />9<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  13. 13. Present data and charts to the compensation committee for review and adjustment<br />Determine grades<br />Establish the number of levels, junior, intermediate and beginner for each job family and assign a grade to each level<br />Determine the number of pay grades, or monetary range of a position at a particular level, within each department.<br />13th June '11<br />10<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  14. 14. Establish grade pricing and salary range<br />Establish benchmark/key jobs<br />Review the market price of benchmark jobs within the industry<br />Establish a trend line in accordance with company philosophy – where the organization wants to be in relation to salary ranges in the industry<br />13th June '11<br />11<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  15. 15. Salary structure determination<br />Determine the difference between each salary step.<br />Determine a minimum and a maximum percent spread.<br />Slot the remaining jobs.<br />13th June '11<br />12<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  16. 16. Salary administration policy<br />Review job descriptions.<br />Verify the purpose, necessity for maintaining the position.<br />Review with the compensation committee for adjustment and mandate to roll out.<br />13th June '11<br />13<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  17. 17. Develop, document and communicate the general policy and execute<br />Develop and document specific policies for selected groups<br />Develop and document a strategy for merit raises and other pay increases, such as cost-of-living adjustment, bonuses, annual review, promotions<br />Develop and document procedures to justify the policy - performance appraisal forms, merit raise schedule<br />13th June '11<br />14<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  18. 18. Executive approval for salary structure and roll out<br />Develop and present cost impact studies that project the expense of bringing the present staff up to the proposed levels<br />Present data to the compensation committee for discussion and approval<br />Present data to the senior executive for buy-in<br />13th June '11<br />15<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  19. 19. Communicate the final program to employees and managers<br />Present the plan to the compensation committee for feedback, adjustment, review and approval<br />Make a presentation to the executive team and managers for approval or change, and incorporate necessary changes<br />13th June '11<br />16<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  20. 20. Develop a plan for communicating the new program to employees, using slide shows or movies, literature, handouts<br />Make presentations to managers and employees then execute the program<br />13th June '11<br />17<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  21. 21. Design and develop detailed systems, procedures, and forms<br />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.<br />13th June '11<br />18<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  22. 22. Have the necessary forms printed<br />Develop and determine format specification for all reports<br />Execute test runs on the human resources information system<br />Execute the program<br />13th June '11<br />19<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  23. 23. Monitor the program<br />Monitor feed back<br />Adjust as necessary<br />Identify challenges in the program and adjust accordingly<br />13th June '11<br />20<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  24. 24. Class group discussion tasks<br />Eagles<br />Synergy3<br />Team-Six<br />Is job evaluation a value adding exercise or a academic waste of time indulgence. Critically review the question from strategic HR perspective.<br />In an organization where there is an effective compensation structure, review why SHR people should concern themselves with developing rewards and benefits systems?<br />Many SHR Directors benchmark best practices<br />in developing compensation a compensation system. Develop a case for benchmarking HR best practices. <br />13th June '11<br />21<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  25. 25. Reading Assignment<br />Read Course Text Chapter<br />Cha. 11 – Strategic Compensation Systems - Pg.390 – 429<br />Cha. 13 – Benefit Plans - Pg.463 - 508<br />13th June '11<br />22<br />GMB6070 - SHRM FRANKFURTCLASS<br />
  26. 26. End of Session 6<br />Thank you<br />13th June '11<br />23<br />GMB6070 - SHRM FRANKFURTCLASS<br />