Compensation and Benefits Notes Chapter 3.docx

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Western University
Management and Organizational Studies
Management and Organizational Studies 3342A/B
Linda Eligh

9/11/2013 11:21:00 AM  Compensation and Benefits Notes   September 11, 2013  Lecture 1 – Chapter 1 The Pay Model   Compensation: all forms of financial returns and tangible services and benefits that employees receive as part of an employment relationship  Tips  Commission  Merit based compensation  Spending accounts  Stock options  Education reimbursement   Contrasting Perspectives of Compensation  Employee: want to be paid fairly and enough to support their lives  Stock Holders: interest in pay of individuals (employees and executive) because it affects the price of the stock  Global Perspective: companies go global early in formation to create a large market, need to understand compensation differences in different countries  Managers: compensation is an expected cost   Cost of Labour  Lower at larger institutions (ex. Wal – Mart and Costco)  Growth in discount shopping   Total Earnings Perspectives on Compensation Decisions  Employers  Present value perspective start off at a lower rate  Cost commitment are you going to be profitable in the future  Employee  How much its costs to hire you  Affects budget   Pay: Part of an exchange relationship (deal)  An implicit contract is an unwritten understanding   3 basic building blocks for a pay model  Efficiency  Fairness  Compliance   Internal alignment: comparisons between jobs inside an organization  External Competitiveness: comparisons o compensation with competitors external to organization  Employee contributions: relative emphasis placed on employee performance   Whole Foods Culture  Empowering work environments  Appreciate effort and reward results   Self directed Teams  Fundamental work unit, members have right to access information   Shared Fate  No entitlement, community of interest among all stakeholders    September 18, 2013   Lecture 2 – Chapter 2 The Totality of Decisions   Strategy: fundamental business decision that a organization has made in order to achieve its strategic objectives  May involve different strategies within the same industry/ company  Want to gain/sustain competitive advantage  “Let the market decide?”  Doesn’t work internationally  Developed economies  highly regulated labour markets and less movement of people  Emerging market economies and emerging labour economies  Acquisitions and mergers  Strategic Choices  Look at annual report for information about the company and their past/ future strategies  HR can put strategies in place to help the company see where they’re going  Having effective compensation packages is a key factor and is very important to having a competitive advantage   Video: Strategic Perspective at SAS  Largest privately held software company in the world  Use stimulating environment and key incentives to place employees in the best position for them  Hiring manger lets other team members interview candidate  HR Planning at SAS  Prepare employee inventory  Prepare a job analysis   Attracting and retaining the best employees   Flexible scheduling  job sharing and telecommunication  Appraising employee performance and evaluations  People are assets- low turnover rate pays for itself  Want people with the correct attitude and behavior  Work- life balance  Their strategy leads to happy customers   Starbucks  Mission Statement: To establish starbucks as their premier purveyor os the best coffe in the world   Top player in transformation of capitalism  Corporate social responsibility  ca
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