The document discusses managing compensation and benefits as crucial factors for driving employee motivation and aligning with business strategies. It covers the importance of compensation equity, internal and external factors influencing pay structures, and the classification of various compensation components. Additionally, it highlights trends in rewards and executive compensation, emphasizing the need for flexible reward systems to enhance employee retention and performance.

1. MANAGING COMPENSATION AND BENEFIT
Driving Employee
Motivation through
Compensation and Benefit
Adhyatmika | Amir | David | Kynan | Tantia

3. MANAGING COMPENSATION AND BENEFIT
Why do millions of
people go to work
each day?
We all have a drive to acquire
money, things,
prestige, power…

4. MANAGING COMPENSATION AND BENEFIT
Increases
Effort
Improves
Focus
Drives
Creativity
Enhances
Persistence
Aids
Retention

5. MANAGING COMPENSATION AND BENEFIT
ALIGNING WITH
BUSINESS
STRATEGY

6. MANAGING COMPENSATION AND BENEFIT
Why does compensation become important?
Contribution based Ensure Equity
Remuneration
Effective Administratively
Attract talent Compensation Efficient Legal
Compliance
Motivate & Retain Reward Valued
Staff Behavior

7. MANAGING COMPENSATION AND BENEFIT
What should the
company be aware of?
Link with
objectives&
culture
Establishing pay
Motivate
for performance
employee
standard

8. MANAGING COMPENSATION AND BENEFIT
The Internal and External Equity
INTERNAL EXTERNAL
FACTORS FACTORS
•CONDITIONS OF
COMPENSATION THE LABOR
STRATEGY OF THE MARKET
ORGANIZATION
•AREA WAGE RATES
WORTH OF JOB
PAY LEVELS •COST OF LIVING
EMPLOYEE’S
RELATIVE WORTH
•COLLECTIVE
BARGAINING
EMPLOYER’S
ABILITY TO PAY
•LEGAL
REQUIREMENTS

9. MANAGING COMPENSATION AND BENEFIT
What is the entire pay model process?
Business Goals
Compensation
activities serve
CEO
Business Business Objectives
Strategy
Compensation strategy
HR Head
Compensation is periodically
Strategy reevaluated and the
Org.Structure Non-Financial
Compensation plan
Rewards
periodically developed
Compensation
Plan
C & B/S M
Performance Job Evaluation Market Surveys
Management
Unit Inputs
Pay levels /
structures Compensation Manager,
Contribution along with team is
Employee
/outputs responsible for carrying
Total out compensation
remuneration related activities
Performance
linked Pay
Individual Pay
Internal Equity External Equity
9

10. MANAGING COMPENSATION AND BENEFIT
Job Evaluation: HAY Method
“The Most Widely Used Point System in The World”
The measurement Problem
Know-How Accountability
Solving
Output: Rank Order
Internal
Equity Market
Analysis Pricing
Analysis

11. MANAGING COMPENSATION AND BENEFIT
Salary Survey: Kelly Services

12. MANAGING COMPENSATION AND BENEFIT
BALANCED, PRACTICAL REWARD
STRATEGY MODEL
EMPLOYER’S EMPLOYEE’S
PERSPECTIVE PERSPECTIVE
ORGANIZATION COMPETENCIES
CAPABILITIES
BUSINESS EMPLOYMENT
DEAL DEMOGRAPHICS
STRATEGY
ORGANIZATION
STRUCTURE VALUES
TOTAL REWARD STRATEGY
PAY BENEFITS
LEARNING & WORK
DEVELOPMENT ENVIRONMENT
IMPROVED BUSINESS RESULTS & ALIGNED EMPLOYEE BEHAVIOURS

13. MANAGING COMPENSATION AND BENEFIT

14. MANAGING COMPENSATION AND BENEFIT
What Are The
Classification&
Components?

15. MANAGING COMPENSATION AND BENEFIT
How the Rewards are
classified? Base Pay:
Wages,
Salaries
Direct
Variable Pay:
Incentives (Individual,
Team,
Organization)
Financial Mandatory:
(Extrinsic Provident Fund,
Rewards) Gratuity,
Maternity
Leave, Health
Plans, medical
Leave
Total
Compensation Indirect Benefits
Voluntary:
Vacations,
Satisfaction Break, Holiday,
Non Financial derived Security Plan,
(Intrinsic Educational
Assistance,
Rewards) Praise and Recreational
Rewards

16. MANAGING COMPENSATION AND BENEFIT
How do I get my
Direct Pay?
Fixed
Payment
based on
Period
Salaried Hourly
Payment 
Wages
Project
Based
Commission

17. MANAGING COMPENSATION AND BENEFIT
How would the company
pay for my risk working
there?
Health Benefits 
Wellness
Programs
inpatient&
outpatient Security Pensions
plan, mobility,
flexible
retirement,
Provident Fund

18. MANAGING COMPENSATION AND BENEFIT
Incentives Plan
•Piece Work Plan
•Straight Piecework
Individual
Incentives •Standard Hour Plane
Organizational Group/team
Incentives Incentives
Profit Sharing Gain sharing Plan:
Rucker, Scanlon,
Improshare

19. MANAGING COMPENSATION AND BENEFIT
Total Rewards Trends:
Flexible Rewards
(Pay For Performance)
Pay plans that aim
Paying for skills, Collective bonus
for high- Less Fixed, more
knowledge, and and Bonus
performance work competencies variable
deferral
system.
Pros Cons
• Higher quality • Implementation problems
• Cost implications of
paying for unused
• Lower absenteeism knowledge, skills and
and fewer accidents behaviors
• Uncertainty
• Consolidating salary
grades

20. MANAGING COMPENSATION AND BENEFIT
Total Rewards Trends:
Flexible Rewards (Choice)
Low Flexibility High Flexibility
Low Cost High Cost
- Premium - Choice - Core: Basic Flexible
Salary Reduction
Modular Options
Core Plus
Mix and Match
Conversion different coverage Credits
- Flexible combinations - Plus: Flexible
Spending of benefits credits to
Account purchase
additional
coverage

21. MANAGING COMPENSATION AND BENEFIT
Total hours
worked
per week
Childcare
Subsidy
Childcare
Flexibility
Family Friendly
Workplace Holidays:
Number
Job Practice & Regulation
Switching
Working
Job Sharing
from Home

22. MANAGING COMPENSATION AND BENEFIT
What is the Trend for Executive
Compensation?
Base salary, Short-term incentives or bonuses,
Long-term incentives or stock plans and
Perquisites (perks)
Executive Personal
Company Financial Company-
Company car eating liability
plane consulting paid parking
facilities insurance
Estate First-class Home Chauffeur Children’s
Spouse travel
planning air travel computers service education
Large Luncheon
Physical Mobile Income tax Country club
insurance club
exams phones preparation membership
policies membership
Personal Legal Vacation
Loans
home repairs counseling cabins

23. MANAGING COMPENSATION AND BENEFIT
Issues in Managing
Compensation
Cost Attraction/retention
containment/reduction Process
• Wage Freeze • Sign-on/hiring
• Pay Reduction bonus
• Hiring Freeze • Employee Referral
• Limit/eliminate Bonus
overtime • Flexible work
• Reduction in force schedules
• Early retirement • Spot Bonus
• Increase employee • Merit prevalent
share of health care
premiums from bonus

24. Compben Structure in
FMCG Industry

25. MANAGING COMPENSATION AND BENEFIT
4th
Largest
Sector
Employee Compben
Structure based on
cost-
competitiveness,
innovation and
mass-market
nature of the
products

26. MANAGING COMPENSATION AND BENEFIT
Unilever:
Pay For Performance, Market
Competitive and Long Term
Retention
Fixed Salary which Variable Salary linked
Employee Gain
competitive with its to company and
Sharing.
peer companies individual performance
Benefits and Retirement benefits
Perquisites aimed at which market
providing you choices. competitive
Source: www.ghallabhansali.com

27. MANAGING COMPENSATION AND BENEFIT
Johnson & Johnson
Compete and Retain for
Talented Employees
Award Programs:
Flexible Reward Plan: Standards of
The benefits programs
Cash and J & J common Leadership Awards
and services to
stock’. Program, global Encore
Awards Program
Maintain good health
Plan for retirement
and well-being
Source: www.ghallabhansali.com

28. MANAGING COMPENSATION AND BENEFIT
Procter and Gamble
High Ownership towards the
Company
Every one of P&G’s
110,000 employees is
18% of the Firm owned
given P&G stock as part
by the Employee of the company’s One
Share program.
Source: www.ghallabhansali.com

29. The End Of Presentation