Question

Stakeholders expextations pose challenges for compensation professionals. At times, there may be conflict among the expectations of different stakeholders. Give two examples and explain how compensation professionals meet the stakeholder expectations.

Ch1 Strategic Compensation: A human resource management approach (9th ed). Pearson Publishing Co.

Answer 1

answer-

Managing stakeholder expectations is an important part of managing project-based work.The compensation professional’s role is one of the most diverse within an organization. It touches all employees; manages the programs that directly impact an organization’s performance; requires internal knowledge of the organization’s culture, structure, departments and jobs and external knowledge of its industry and labor markets; and has a skill set running the gamut from analyst to negotiator to communicator to educator.There may be sometimes conflict which can be seen between the expectation of different stakeholders and Compensation professionals.

These conflicts can arise cause of Employees and other executives are not getting compensation according to their performance and job position and this could be based on market basis, Performance basis, or Government rules and regulation basis.

for example- If there is Medium sized company who is in need for cutting down the cost of business so Compensation professional cut down the salaries of employees in the company based on the market rate rather than their performance.

The conflict resolution or how they can meet the expectation of different stakeholders like employees, Government, Executives etc. first they should identify who their stakeholders are and what is their importance in the company.

for example- A CEO is the main person who is responsbile for operating the business so Compensation profession has to identify his worth and then set the compensation which meets his expectation and CEO would run the company effectively.

Second, Make decisions related to compensation by engaging with stakeholders to know their views and opinions and make a report who is worthy of getting compensation as per their strengths, skills and position in the company.

for example- An employee is highly talented and skilled and the other employee at same position doing nothing and showing poor performance then Compensation profession should give more compensation based on performance of employee and make the base pay to non performing employee.

Compensation profession should also consider government employment rules and regulations related to wages and salaries in country.

so, meeting expectation is necessary because stakeholders have interest in business and if they are dis satisfied then business would suffer.