Question

A total compensation plan must meet the specific needs of an organization’s corporate strategy while incorporating current trends and issues that exist in the current workforce.

Discuss methods to coordinate total compensation plans. How would you incorporate current trends or issues into the methods you identified?

Answer 1

The main objective of total compensation plan of the company is to attract and retain the qualified, talented and experienced workforce in the core area of business of the company. For retaining the talented human resource for the long term, the companies provides them good salary and other benefits. A total compensation plan must meet the specific needs of an organization’s corporate strategy while incorporating current trends and issues that exist in the current workforce. To motivate the workforce of the company for long term, they should be enthusiastic about mission and values of the company and they should identify themselves with the organization’s culture. The company should make a fine balance between its mission and value statement and compensation program so that the prospective workforce should set realistic expectation from the company.

While evaluating employee compensation plan there are many approaches and all have some merits and some demerits but the important factor is that what suits the company’s criteria or which plan better serves the company’s objective. The job based evaluation plans focuses more on what are the jobs assigned to the person regardless what kind of skill that person have while in person based plans focuses more on skills the personal have like qualifications, certifications, experiences etc. rather than what kind of job assigned to him. The evaluation system for the company should incorporate current trends or issues into the methods like what are expected from them, how efficiently they can perform their task, how they are going to be evaluated for their performance, and how they can get performance reviews and compensation, bonus, increments etc. How the whole organization is going to get benefited from such kind of system in place.