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How to Develop a Total Compensation
                   Strategy




                              May 4, 2009
Presented By: Natasha Lomas
Agenda
   Define Compensation
   Define Strategy
    Strategic Choices
   Tailoring the Compensation System to Business
    Strategy
   The Total Compensation System
   Compensation Elements
   Key Steps
   Rewards of Work
   Questions
What is Compensation?

 Design
 Diagnosis
 Re-enforce
What is Strategy?




 Strategy refers to the fundamental directions that an
  organization chooses.
Strategic choices
 Corporate objectives,
                                    Business unit
strategic plans, visions
                                     strategies
      and values


                                                     HR Strategies


                                                                Strategic
                              Social, competitive,
                                                              compensation
                                and regulatory
                                                                decisions
                                 environment

                                                                     Compensation
                                                                       systems


                                             Competitive              Employee attitudes
                                              advantage                 and behaviors
Aligning Compensation Strategy
Assessment



                                                                  Industry and Labor
                                       Strategic Business &
                Employee Inputs                                    Market Practices
                                         Operating Inputs
                and Preferences                                       and Trends



                Compensation Philosophies and Objectives

                               Organization
             Base Pay
                              Performance or    Fringe Benefits   Compensation
  Design




                               Variable Pay,
                                                                  Administration
             Delivery         Nonmonetary &
                              Other Monetary
                                Rewards &
                                Recognition
Comment and
  Strategy                      Flexibility
and Value
Management
                  Total
              Compensation
                 System




             Motivation and
              Performance
Compensation Elements

          Fringe Benefits


     Mid/ Long-Term Incentives



          Short Term Incentives




            Base Salary
Key Steps
                Assess Total
              Compensation
               Implications


Reassess               Map a Total
                   Compensation Strategy



  Implement Strategy
Questions

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How To Develop A Total Compensation Strategy

  • 1. How to Develop a Total Compensation Strategy May 4, 2009 Presented By: Natasha Lomas
  • 2. Agenda  Define Compensation  Define Strategy  Strategic Choices  Tailoring the Compensation System to Business Strategy  The Total Compensation System  Compensation Elements  Key Steps  Rewards of Work  Questions
  • 3. What is Compensation?  Design  Diagnosis  Re-enforce
  • 4. What is Strategy?  Strategy refers to the fundamental directions that an organization chooses.
  • 5. Strategic choices Corporate objectives, Business unit strategic plans, visions strategies and values HR Strategies Strategic Social, competitive, compensation and regulatory decisions environment Compensation systems Competitive Employee attitudes advantage and behaviors
  • 6.
  • 7. Aligning Compensation Strategy Assessment Industry and Labor Strategic Business & Employee Inputs Market Practices Operating Inputs and Preferences and Trends Compensation Philosophies and Objectives Organization Base Pay Performance or Fringe Benefits Compensation Design Variable Pay, Administration Delivery Nonmonetary & Other Monetary Rewards & Recognition
  • 8. Comment and Strategy Flexibility and Value Management Total Compensation System Motivation and Performance
  • 9. Compensation Elements Fringe Benefits Mid/ Long-Term Incentives Short Term Incentives Base Salary
  • 10. Key Steps Assess Total Compensation Implications Reassess Map a Total Compensation Strategy Implement Strategy
  • 11.