Framework for Analyzing Employment Relationships PowerPoint Presentation ;

Framework for Analyzing Employment Relationships PowerPoint Presentation ; Project instructions: (1) Please review the Framework for Analyzing Employment Relationships, Chapter 2 Supplemental slide which can be accessed within a supplement to Chapter 2 (2) Provide one example of a job for each of the four quadrants of the framework. That is, you are to provide examples of four different occupations and indicate in which one of the four quadrants a specific job can be categorized. Chapter 2 Strategy: The Totality of Decisions 2 - * Learning Objectives Similarities and differences in strategies Strategic choices Support business strategy Support HR strategy The pay model guides strategic pay decisions Learning Objectives Developing a total compensation strategy: four steps Source of competitive advantage: three tests ?Best Practices? versus ?Best Fit?? Guidance from the evidence Virtuous and vicious circles Exhibit 2.1 - Three Compensation Strategies Similarities and Differences in Strategies Different strategies within the same industry Different strategies within the same company Strategic Choices Strategy: Fundamental directions that an organization chooses Strategic perspective Compensation choices that help the organization gain competitive advantage Exhibit 2.2 - Strategic Choices Support Business Strategy Aligns pay systems with organization's business strategy Better the alignment, more effective is the organization Contingency notion Change in business strategies should result in change, pay systems Exhibit 2.3 - Tailor the Compensation System to the Strategy tailor Support Business Strategy Customer focused business strategy Stresses delighting customers and bases employee pay on how well they do this Cost leadership strategy- Firms that cut costs Differentiation strategy Unique and innovative product or service at a premium price Support HR Strategy AMO theory P (Performance) = f(A,M,O) A- Ability M- Motivation O- Opportunity HR systems will be most effective when: Employee ability is developed through selective hiring and training Support HR Strategy Compensation system motivates employees Roles allow employees to be involved in decision making Exhibit 2.5 - Fit Between HR Strategy and Compensation Strategy and Effectiveness fit3 The Pay Model Guides Strategic Pay Decisions Strategic compensation choices Objectives Internal alignment External competitiveness Employee contributions Management Stated strategies - Written compensation strategies Unstated strategies - Inferred from the pay decisions Developing A Total Compensation Strategy: Four Steps Step 1 - Assess total compensation implications Step 2 - Map a total compensation strategy Step 3 - Implement strategy Step 4 - Reassess Exhibit 2.6 - Key Steps in Formulating a Total Compensation Strategy steps Step 1 - Assess Total Compensation Implications Business strategy and competitive dynamics- Understand the business Changing customer needs Competitors? actions Changing labor market conditions Changing laws Globalization Assess global competitive dynamics Step 1 - Assess Total Compensation Implications HR strategy - Pay as a supporting player or catalyst for change? Pay strategy Is influenced by how it fits with other HR systems Can be a supporting player, as in the high-performance approach Can take the lead and be a catalyst for change Step 1 - Assess Total Compensation Implications Culture/Values Guide an employer's behavior and treatment of employees Reflected in the pay system Social and political context Legal and regulatory requirements Cultural differences Changing workforce Demographics Affects compensation choices Step 1 - Assess Total Compensation Implications Employee preferences How to better satisfy individual needs and preferences Choice May confuse employees Challenging to design and manage Requires meeting codes and regulations Step 1 - Assess Total Compensation Implications Union preferences Affect pay strategy Unions' interests can differ Compensation deals with unions can be costly to change Step 2 - Map a Total Compensation Strategy Strategic map Provides compensation strategy based on pay model Clarifies the message that company is trying to establish with its compensation system Does not tell which strategy is best but provides a framework and guidance Exhibit 2.8 - Contrasting Maps of Microsoft and SAS Steps 3 and 4 - Implement and Reassess Step 3 Involves implementing the strategy through : The design and execution of the compensation system Step 4 Recognizes that the strategy must change to fit changing conditions Involves periodic reassessment Sources of Competitive Advantage: Three Tests Is it aligned? With the business strategy Externally with the economic and socio-political conditions Internally with HR system Does it differentiate? Does it add value? Calculate the return on investment (ROI) ?Best Practices? versus ?Best Fit?? Best Practices Assumptions: A set of best-pay practices exists Practices can be applied universally across all situations Results in better performance with almost any business strategy Best Fit An organization is likely to achieve competitive advantage if the pay system: Reflects company?s strategy and values Is responsive to employees? and unions? needs Is globally competitive Guidance from the Evidence Internal alignment Pay differences among internal jobs can affect results External competitiveness Paying higher than the average paid by competitors can affect results Employee contributions Performance-based pay can affect results Guidance from the Evidence Managing compensation Consider all dimensions of the pay strategy Compensation strategy Should be embedded within broader HR strategy Identify what practices pay off best under what conditions Virtuous and Vicious Circles Research indicates that: How you pay matters as much as how much you pay Performance-based pay: Improves performance when combined with high-performance practices Can be the best practice under right circumstances PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET AN AMAZING DISCOUNT :)