OL 620 Southern New Hampshire University Emerging Pharmaceuticals and Medtronic Comparison Case Study

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OL 620

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Hey make sure to read the guidelines and rubric, the emerging pharmaceuticals case study and the 2018 Medtronic Benefits data that is provided in the upload. Please let me know if you need anymore information and good luck.

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OL 620 Milestone One Guidelines and Rubric Professionals in the human resources field are often tasked with overseeing the benefits and compensation functions within any given organization. Human resource professionals often have to examine specific compensation and benefit elements of a total rewards system and compare them with qualitative and quantitative data collected internally, to determine how to fairly and appropriately reward employees for their work. For the final project, you will analyze Emerging Pharmaceuticals in order to evaluate and revise the company’s current total rewards system. You will utilize information presented in the case study to compare and contrast the U.S. organization’s total reward system with external benchmarking data. You will also analyze the data for gaps and make revisions to the existing compensation and benefits package. The information you are provided with will be based on a specific aspect of a benefits and compensation package (retirement benefits, medical benefits, and so on). You will also create a presentation to stakeholders that explains the proposed changes, your rationale behind the changes, and the implications of the changes for the organization. For Milestone One, you will prepare a draft of Parts A–C of your total rewards analysis (Section I of the final project). Your submission will have the major heading “Total Rewards Analysis: Parts A–C.” Your instructor will grade your submission using the rubric below and will provide feedback you can apply to your final project. Begin by analyzing qualitative and quantitative data for the current system (as identified in the case study) that will inform your future recommendations and revisions. Once your analysis has been completed, compare and contrast the provided quantitative data regarding the current benefits and compensation system with external benchmarking data from Medtronic, an organizations within the same industry. Then draft Parts A–C of your analysis. Thoroughly cover each of the critical elements, and include your answers to the guiding questions. Specifically the following critical elements must be addressed: I. Benefits and Compensation Analysis: For this part of the assessment, you will analyze given aspects of a benefits and compensation package from the provided case study. You will analyze qualitative and quantitative data regarding the current system and determine gaps in that system that will inform your future recommendations and revisions. A. Analyze the issues or concerns of employees through a review of the qualitative data presented in the case study, for their validity and importance. Be sure to consider the needs of different demographics of employees within the organization. B. Determine the key issues or concerns of employees that should be targeted and addressed, based on the provided qualitative data. Justify your response. What issues or concerns should be targeted and why? Why should other concerns be made less of a priority? You could consider the underlying reasons behind the issues voiced by employees. C. Compare and contrast the provided quantitative data regarding the current benefits and compensation system with external benchmarking data from the provided Medtronic data to complete your response. What does the current system have that other organizations do not? What do other organizations offer that the current system does not? Be sure to justify your response. Rubric Guidelines for Submission: This milestone should be 3–4 pages in length (in addition to a cover page and references section) and should be submitted as a Microsoft Word document with double spacing, 12-point Times New Roman font, and one-inch margins. Use at least three sources, which should be cited according to APA style. Needs Improvement (80%) Not Evident (0%) Value Benefits and Compensation Analysis: Issues or Concerns Critical Elements Analyzes the issues or concerns of employees, reviewed through the qualitative data, for their validity and importance for organizational review, considering the needs of different employee demographics within the organization Analyzes the issues or concerns of employees, reviewed through the qualitative data, for their validity and importance for organizational review, considering the needs of different employee demographics within the organization, but analysis is cursory Does not analyze the issues or concerns of employees, reviewed through the qualitative data, for their validity and importance for organizational review 30 Benefits and Compensation Analysis: Targeted and Addressed Determines key issues or concerns of employees that should be targeted and addressed, based on the provided qualitative data, justifying response Determines key issues or concerns of employees Does not determine key issues or that should be targeted and addressed, based on concerns of employees that should be the provided qualitative data, justifying targeted and addressed response, but determination is cursory, illogical, or there are gaps in the justification 30 Benefits and Compensation Analysis: External Benchmarking Data Compares and contrasts provided quantitative data regarding the current benefits and compensation system with external benchmarking using the provided tables and justifying response Compares and contrasts provided quantitative data regarding the current benefits and compensation system with external benchmarking data using the provided tables, justifying response, but analysis is cursory, illogical, contains inaccuracies, or there are gaps in the justification Does not compare and contrast provided quantitative data regarding the current benefits and compensation system with external benchmarking data 30 Submission has no major errors related Submission has major errors related to citations, to citations, grammar, spelling, syntax, or grammar, spelling, syntax, or organization that organization negatively impact readability and articulation of main ideas Submission has critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas 10 Articulation of Response Proficient (100%) Total 100% Medtronic Benefits Information For use in OL 620 comparison with the supplied case study data Retrieved from http://benefits.medtronic.com/SitePages/ChannelContentR2.aspx?ChnIDval=3&GrpIDval=16&IDval=21 Emerging Pharmaceuticals and Medtronic Comparison Introduction You have recently been hired as a Total Rewards Director for Emerging Pharmaceuticals, a growing pharmaceuticals manufacturer on the West Coast of the United States with 25 global locations. Emerging Pharmaceuticals was started by a group of private investors in 2011 and has skyrocketed in revenue over the last 3 years. Projected revenue for Emerging Pharmaceuticals is expected to top $5 Billion by the end of the calendar year. Your job is new to the organization, created because the organization has increasingly been losing talent to Medtronic, one of Emerging Pharmaceuticals’ main competitors. Turnover of new hires with less than 2 years of employment at Emerging Pharmaceuticals is 25%. The vice president of human resources at Emerging Pharmaceutical feels it’s important to compare the health, wealth and work/life offerings of Emerging Pharmaceuticals with Medtronic and is expecting you to develop a Total Rewards strategy for the coming year that will retain critical employees, respond to the needs of multiple generations in the workforce, and keep costs under control. 1 Emerging Pharmaceuticals and Medtronic Comparison Emerging Pharmaceuticals Workforce The workforce at Emerging Pharmaceuticals has tripled since its inception in 2012, growing to a total of 15,000 employees working in jobs such as scientists, research analysts, IT techs, sales, administrative support, call centers, patient advocates, clinical trial specialists, patent attorneys, and middle- and senior-level management. The employee demographics with employment types are shown below. Global Full-Time Employees Age and Status Demographics Total of all employees 30 and under 31-50 51 and above Total Females Locations U.S. Asia- Pacific Canada U.K. Latin America Global Part-Time Employees Age and Status Demographics Total part-time employees 30 and under 31-50 51 and above Total Females Locations U.S Asia- Pacific Canada U.K. Latin America Total in Current Calendar Year 15,000 2,640 10,018 2,012 7,042 10,100 865 895 2003 807 Employment Type Employment Type by Position Administrative Support Staff Professional Clinical/Scientists/Research Analysts Middle Managers Senior Management Total in Current Calendar Year 6,600 4,375 2,450 1,200 375 2 Total in Current Calendar Year 330 105 125 100 247 220 23 27 45 15 Emerging Pharmaceuticals and Medtronic Comparison Employee Value Proposition The employee value proposition (EVP) at Emerging Pharmaceuticals in the early stages was focused on challenging work, competitive pay and opportunities to advance. In response to the increasing exodus of employees to Medtronic, the vice president of human resources hired an external consultant to conduct employee focus groups. She is concerned with the results, especially in employees aged 31-50 with at least 2 children, which make up 37% of the workforce. The vice president learned of employee concerns about selections and costs in the health plans; disenchantment with the 401(k) plan, which has no employee match; and questions about career paths, advancement opportunities, and work hours. The high level of organizational growth has put pressure on all positions in the organization. Here are the aggregated results of the focus groups’ responses: TOPIC CATEGORIES FROM EMPLOYEE RESPONSES Work remotely Tuition reimbursement Healthy lifestyle reward/Voluntary benefit options Financial Wealth Options/Pension Match Paid Time Off/ Family Time Options Market “right” pay for position Opportunities to use skills/abilities Job-specific and company-sponsored general training Professional development opportunities Workplace safety Community engagement/Corporate social responsibility Recognition of job performance/variable pay options Employee respect and diversity in the work environment Trust between employees and Sr. Management Teamwork within department % RESPONDED AS IMPORTANT 10% 8% 6% 5% 8% 10% 3% 8% 9% 2% 5% 8% 6% 5% 7% The vice president read comments such as: 3 Emerging Pharmaceuticals and Medtronic Comparison         I never get home before dinner and we have a new baby at home. I leave for work at 6 a.m., fight highway traffic to be in by 8, and extra work always ends up on my desk towards the end of the day. I can’t seem to get out of the office until 7 p.m. and home by 8:30. By the time I get home my son is already asleep. I wish the company had a way for me to work from home. I don’t see how I can move up in the organization when management positions require a degree, and the tuition reimbursement for school is so low. Thirty-five hundred a year doesn’t go very far. Just the textbooks can cost $1,000. There are some real safety hazards in my lab; OSHA would have a field day. While I understand that the organization had to implement a “working spouse” surcharge for my health insurance, my husband and I are really into a healthy lifestyle. We don’t smoke, we exercise and eat right and there’s no incentive for us – my husband’s health plan is not as good and we are concerned about coverage because we’re trying to save for our first home. But now I have to pay another $50.00 per month to cover him in our plans. How come there are no rewards for people like us who really work to take care of ourselves? The company claims they care about providing good rewards for us, but there are no voluntary benefit options, the pension plan has no match, and I don’t know how I can save enough to retire. Are the profits just going to the “people at the top” and leaving the rest of us behind? The paid time off schedule only goes up to 18 days after 10 years of employment, with no sick time. I guess we’re supposed to leave after 10 years. Is this a way to get rid of older employees? I always go the “extra mile” at work and my manager doesn’t seem to notice. I like my job, but a couple of people I worked with left recently for better pay at another company. After reading all of the employee feedback, you and the vice president decide to compare Emerging Pharmaceuticals Health, Wealth and Work/ Life Total Rewards structure with information from Medtronic and make some revisions to the total rewards strategy for Emerging Pharmaceuticals. Health Options for Emerging Pharmaceuticals Emerging Pharmaceuticals offers two health plan options to employees: the Value Preferred Provider Plan (Value PPO) and the Choice Plus Preferred Provider Plan (Choice+ PPO). The Value PPO has lower bi-weekly costs but higher out-of-pocket costs at the time of service. The Value PPO uses a narrow network of providers with higher penalties for out of network providers. The Choice+ PPO has higher bi-weekly costs, but lower out-of-pocket costs. The Choice+ PPO offers a broader network of providers for participant choice. 4 Emerging Pharmaceuticals and Medtronic Comparison Emerging Pharmaceuticals promotes the use of generic drugs and has established a $5.00 co-pay for generic prescriptions, and the organization is considering a partnership with Care Compare, a benefits selection tool that helps employees search for and compare the cost of procedures at various providers or facilities. If an employee uses Care Compare, Emerging Pharmaceuticals offers a financial incentive for selecting the lowestcost provider. Medical (bi-weekly costs) Value Preferred Provider Plan (lower premiums but high outof-pocket costs) Employee Only - $57.50 Employee Plus One- $157.50 Employee plus two or more- $257.50 Choice+ Preferred Provider Plan (higher bi-weekly premiums but lower out-of-pocket costs) Employee Only - $86 Employee Plus One-$141.50 Employee plus two or more - $500 Health Plan Designs - Value Preferred and Choice+ Plans Plan Design Elements Office Visit Copay Urgent Care Emergency Room Inpatient Value PPO – 80 % Coinsurance- In-Network Value PPO – 80 % Coinsurance- Out of Network Choice+ PPO- 100% CoInsurance- In Network Choice+ PPO- 100% CoInsurance- Out of Network $25 $35 $250 $500 $75 $85 $250 $1,250 $10 $20 $100 $250 $20 $45 $100 $250 $1,000 $2,000 $3,000 $3,000 $5,000 $7,000 $750 $1,500 $2,250 $1,250 $2,500 $3,750 Out-of-Pocket Maximum Employee Employee plus one Employee plus two Note: All plans are subject to a working spouse surcharge for spouses of employees who have the option of coverage with their own employer. The surcharge is an additional $25.00 per paycheck. Note: There are no wellness incentives for Emerging Pharmaceutical’s medical plans. 5 Emerging Pharmaceuticals and Medtronic Comparison Dental (bi-weekly costs) Comprehensive Plan- Preferred Provider Employee Only - $12.50 Employee Plus One- $18.00 Employee plus two or more- $40.00 Basic Plan- Network Only Employee Only - $7.50 Employee Plus One-$14.50 Employee plus two or more - $25.00 Dental Plan Designs – Basic and Premium Plan Plan Design Elements Diagnostic/Preventive Care Basic Restorative Procedures Major Restorative Procedures Orthodontia Calendar Year Maximum Basic Plan $100 deductible per person, all other work covered by the plan 75% coinsurance No coverage No Coverage $800 per person Vision (bi-weekly costs) Plan Design Elements Vision Exam Prescription Glasses (instead of contact lenses) One Plan Design for All Employees Employee only - $6.67 Employee Plus One - $11.00 Contact Lenses (instead of prescription glasses) Employee Plus Two - $13.65 Emerging Pharmaceuticals Insurance Enrollment Summary - U.S. Location Medical Plan and Level of Coverage Value Preferred Provider Plan Employee only Employee plus one Premium Plan $150 deductible per person, all other work covered by the plan. 50% coinsurance 50% coinsurance 50% coinsurance, lifetime max to $1,500 $2,000 per person Full Time Part Time Total Employees 285 400 7 10 292 410 6 Plan Co-Pays $20 copay $30 copay. Prescription glasses (frames and lenses) covered 1x each calendar year to max of $140 $165 allowance for contact lenses 1x each calendar year Emerging Pharmaceuticals and Medtronic Comparison Employee plus two or more 2,500 34 2534 Choice Plus Employee only Employee plus one Employee plus two or more 315 500 2,000 6 10 65 321 510 2065 MEDTRONIC 2018 Health Plans Side by Side Comparison Company-Provided Account Contribution CHP with HSA HSA Contribution PPO Plan N/A $500/ Employee only $750/ Employee + spouse OR Employee + children $1250/family Deductible $1,400/ Employee only $2,800/ Employee + spouse OR Employee + children $3,600/family $500 Employee only $1,000/family Out-of-Pocket Maximum (includes deductible) $3,500/ Employee only $7,000/Employee + spouse OR Employee + children $9,000/family $3,500/ Employee only $7,000/family 20% co-insurance, after deductible $20 copay Primary Care Provider Visit 7 Emerging Pharmaceuticals and Medtronic Comparison Specialist Visit Co-insurance Preventive Care Emergency Room Online Care/Virtual Visit Medtronic Mounds View Clinic 20% co-insurance, after deductible 20% 0% 100% covered by plan $40 copay 20% 0% 100% covered by plan 20% co-insurance, after deductible 100% covered by Plan, after deductible 100% covered by Plan, after deductible $150 copay 100% covered by Plan, you pay nothing 100% covered by Plan, you pay nothing Salary Comparison Job Title Emerging Pharmaceuticals Pay Range Average at domestic locations Medtronic Pay Range Average at domestic locations Scientists Average $93,500 Range $82,000 to $100,000 Average $103,900 Range $92,000 to $112,000 Research Analysts Average $76,000 Range $63,000 to $95,000 Average $86,547 Range $71,000 to $125,000 Clinical Specialist Average $69,000 Range $63,000 to $90,000 Average $78,000 Range $70,000 to $128,000 IT Developers Average $90,000 Range $85,000 to $120,000 Average $95,370 Range $89,000 to $132,000 Non- Clinical Manager Average $54,000 Range $48,000 to $68,000 Average $61,750 Range $55,000 to $74,000 Clinical Manager Average $100,000 Range $75,000 to $110,000 Average $105,000 Range $75,000 to $120,000 8 Emerging Pharmaceuticals and Medtronic Comparison Wealth Benefits at Emerging Pharmaceuticals The 401(k) plan has only been in effect for 3 years. The first 2 years of operations, Emerging Pharmaceuticals had no 401(k) in place, and when the organization was ready to start a plan, contributions were not retro to the earlier years of operations, even though the organization had some positive revenue results. The vice president of human resources read some comments from employees about the absence of retro funding, but has not thought about the impact of the employee feedback to this point. The WEALTH PLAN at Emerging Pharmaceuticals has two primary elements: a core contribution, and employee savings. Emerging Pharmaceuticals makes a core contribution to the 401(k) at the end of each calendar year. The core contribution is 3% of eligible pay for each eligible employee. The definition of eligible pay includes annual salary and anything considered to be regular wages. Pay not eligible for a core contribution is pay earned because of a performance bonus, lump sum for unused PTO, or workers’ compensation payments. Emerging Pharmaceuticals makes the core contribution whether you are saving as an employee or not. Employees are not eligible for the pension plan until after completing 1,000 hours of service at Emerging Pharmaceuticals. Employees can save up to the IRS limits each year and should consider options to save as much as possible. Contributions are made on a pre-tax basis and there is a catch-up contribution of an additional $6,000 for employees age 50 and older. Work-Life Benefits at Emerging Pharmaceuticals The work-life benefits at Emerging Pharmaceuticals include paid time off, paid holidays, tuition assistance, and limited remote opportunities. The major holidays are in addition to paid time off and include New Year’s Day, Memorial Day, July 4th, Labor Day, Thanksgiving, the day after Thanksgiving, and Christmas Day. Paid time off is front-loaded according to years of service and is a use-it-or-lose-it benefit. Paid time off is also used for illness. There is no separate illness bank of time. The paid time off schedule is developed off of years of service and, because Emerging Pharmaceuticals is a young company, the table of time only shows 10 years. There are no provisions for time-off banks beyond 10 years. If an employee has paid time remaining in their bank of time after December 15th of any year, the time will be lost. Paid time off banks are reset on or around January 1st of each year. There is no carryover provision and no provision to “buy out” any paid time off. The schedule for Paid Time Off is as follows: Continuous Years of Service 3 years or less After 3 years After 6 years PTO in Days 10 12 15 PTO in Hours 80 96 120 9 Monthly Accrual in Hours 6.15 7.38 9.23 Emerging Pharmaceuticals and Medtronic Comparison At 10 years and every year thereafter 18 144 11.07 NOTE: As the Total Rewards Manager, you should think about how a short term list of time off affects retention of employees. Remote Work Options Remote work options at Emerging Pharmaceuticals are only available to scientists or analysts who develop data analytics for drug/patient outcomes. The remote work option requires daily huddles by Skype for Business and attendance at unit meetings at least once a week. Emerging Pharmaceuticals will provide the appropriate computer equipment and connections. Employees are required to be online by 8:00 a.m. each day and may be required to work on the weekends as requested. There is no reimbursement for home-based Wi-Fi, which is vital to work remotely from home. Tuition Reimbursement The tuition reimbursement program is available to eligible employees. Employees must have completed at least 1 year of service and will be reimbursed for education that is considered either an “upskill” related to the employee’s current position, or coursework as part of an undergrad or graduate degree (doctoral-level education is not included) at an accredited U.S. college or university. The yearly benefit is 100% up to $2,000 for an undergraduate degree and up to $3,500 for a graduate degree. 10
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Outline
I. Benefits and Compensation Analysis:
A. Analyze the issues or concerns of employees through a review of the qualitative
data presented in the case study, for their validity and importance. Be sure to consider
the needs of different demographics of employees within the organization.
B. Determine the key issues or concerns of employees that should be targeted and
addressed, based on the provided qualitative data. Justify your response. What issues
or concerns should be targeted and why? Why should other concerns be made less of
a priority? You could consider the underlying reasons behind the issues voiced by
employees.
C. Compare and contrast the provided quantitative data regarding the current benefits
and compensation system with external benchmarking data from the provided
Medtronic data to complete your response. What does the current system have that
other organizations do not? What do other organizations offer that the current system
does not? Be sure to justify your response.


Running head: BENEFITS AND COMPENSATION ANALYSIS

Benefits and compensation analysis
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BENEFITS AND COMPENSATION ANALYSIS
I.

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Benefits and Compensation Analysis

A. Medtronic company that has thrived in its market and focuses its attention on the
patient's wellbeing by improving their mind, heart, body, and spirit. Its employees
expect the company to implement human resource programs that are consistent with
its strategies that they look at perfecting every day. The main problem that the
company has realized in the recent past is the issue of insurance systems that are
offered to the customers. The system of compensation is inconsistent with what the
employees desire and goes against organizational policies. What Medtronic is looking
at doing is to identify approaches w...


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