Answer a Discussion Question about grade pay and achieving the competitive advantage

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timer Asked: Mar 29th, 2017
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Question Description

I will upload a file (Discussion Question Ch.8) this has the instruction of what I want you to do read it carefully please. Also, has other classmates responses.

And another PowerPoint file that will help you to answer the discussion question.

Please look at it, and answer the discussion question, the answer should be critically and thoughtfully.

Let me know if you have any question.

Thanks

Unformatted Attachment Preview

Discussion Question: (250-300 words long) Respond to the following statement: “Pay grades limit a company’s ability to achieve competitive advantage.” Do you agree? Provide rationale for your position. I want you to discuss and answer this question and to help you to do so I will upload a PowerPoint file helping you to answer this question. Here are two of the classmates responses to this question read it and try to connect their responses to your answer and discussion. Natalie I disagree with this statement, because there are actually several positives associated with pay grades. One, they allow for decisions to be made regarding internal alignment because they look at market data as a guideline for which job falls into which pay grade. Using the market allows for the company to place their jobs into a competitive pay grade. Pay grades also allow placements of jobs that do not have benchmarks which means that there is little market data to look at for a particular job. The advantage of having grades and ranges associated with grades is that the organization can place the position into an apporpropriate pay range based on its alignment with comparable jobs within the organization. Proper use of grades helps to eliminate the need to have market data for all positions, especially when there is little to no market information on the position. Finally, pay grades make it easier to administer and track ranges. Aleko I agree because if this were the case for my job, then I would be more concerned on how to move up the pay grade than I would be on the company's competitive advantage. I think in order to keep a company flourishing that you should offer a base pay with incentives, bonuses, commission, that increase based on performance, tenure, and knowledge. So the pay grade structure would hinder a company's advantage because employees would be more focused on bettering themselves than the company. Whereas the company can develop a pay structure that allows the employees to better their position in regards to pay by doing what's best for the company and being able to maintain a competitive advantage. STRATEGIC COMPENSATION A Human Resource Management Approach Chapter 8: Building Pay Structures That Recognize Employee Contributions Copyright © 2015 Pearson Education, Inc. 8-1 Learning Objectives 1. Explain the concept of pay structures. 2. Specify and explain the five steps necessary to construct a pay structure. 3. Discuss at least two considerations in designing merit pay systems. Copyright © 2015 Pearson Education, Inc. 8-2 Learning Objectives (cont’d) 4. Explain at least two sales compensation plan design considerations. 5. Describe three main considerations of person-focused pay program design. 6. Present a summary of two pay structure variation practices. Copyright © 2015 Pearson Education, Inc. 8-3 Learning Objective 1 Explain the concept of pay structures. Copyright © 2015 Pearson Education, Inc. 8-4 Pay Structure Concept • Pay structures represent – Pay rate differences for jobs of unequal worth – The framework for recognizing differences in employee contributions • Companies recognize these differences by paying individuals according to their: – Credentials – Knowledge – Job performance Copyright © 2015 Pearson Education, Inc. 8-5 Learning Objective 2 Specify and explain the five steps necessary to construct a pay structure. Copyright © 2015 Pearson Education, Inc. 8-6 Constructing a Pay Structure Five steps: 1. Decide how many pay structures to construct 2. Determine a market pay line 3. Define pay grades 4. Calculate pay ranges 5. Evaluate results Copyright © 2015 Pearson Education, Inc. 8-7 Common Pay Structures • Exempt and nonexempt: companies establish these pay structures for administrative ease • Based on job families: executive, managerial, professional, technical, clerical, and craft represent distinct job families • Based on geography: companies with multiple, geographically dispersed locations such as sales offices, manufacturing plants, service centers, and corporate offices Copyright © 2015 Pearson Education, Inc. 8-8 Exempt and Nonexempt Pay Structures • Exempt – Not subject to overtime provisions – Salaried supervisors, managers, professionals, and executives • Nonexempt – Subject to overtime provisions – Hourly, nonsupervisory Copyright © 2015 Pearson Education, Inc. 8-9 Market Pay Lines • Market pay rates relative to company’s job structure • Pay levels corresponding with pay line are market competitive • Rates promote internal consistency Copyright © 2015 Pearson Education, Inc. 8-10 Pay Grades • Based on compensable factors, values, management philosophy • Widths – Narrow or wide – Affects hierarchy and social distance – Absolute or percentage-based job evaluation points Copyright © 2015 Pearson Education, Inc. 8-11 Pay Ranges • Build upon pay grades • Pay grades represent horizontal dimension • Pay ranges represent vertical dimension Copyright © 2015 Pearson Education, Inc. 8-12 Pay Grades and Ranges Copyright © 2015 Pearson Education, Inc. 8-13 The Impact of Alternative Range Spreads Midpoint of $25,000* Range spread 20% 50% 80% 120% Minimum $22,727 $20,000 $17,857 $15,625 Maximum $27,272 $30,000 $32,143 $34,375 Difference between values $4,545 $10,000 $14,286 $18,750 Copyright © 2015 Pearson Education, Inc. 8-14 Pay Compression • When pay is small • Threatens competitive advantages • Caused by: – Failure to raise pay range limits – Scarcity of qualified applicants Copyright © 2015 Pearson Education, Inc. 8-15 Compa-Ratios • Evaluates pay structures • Index competitiveness of internal pay rates based on midpoints • Divide pay rates by midpoint • Compa-ratio meanings 1 = market match rate < 1 = market lag rate > 1 = market lead rate Copyright © 2015 Pearson Education, Inc. 8-16 Learning Objective 3 Discuss at least two considerations in designing merit pay systems. Copyright © 2015 Pearson Education, Inc. 8-17 Merit Pay Systems Considerations • Communicate link between pay and performance • Use effective appraisal methods • Establish increase amounts and types • Settle on base pay level Copyright © 2015 Pearson Education, Inc. 8-18 Merit Pay Grid Copyright © 2015 Pearson Education, Inc. 8-19 Merit Increase Amounts • Reflects prior job performance levels • Needs to motivate • Needs to be meaningful • Influenced by the cost of living • Indexed as a percentage of budget Copyright © 2015 Pearson Education, Inc. 8-20 Timing • Companies typically take one of two approaches in timing of pay raises – Common review date or common review period – Employee’s anniversary date Copyright © 2015 Pearson Education, Inc. 8-21 Present Level of Base Pay • Needs to be within limits of pay grade • Consistent with new employees at similar jobs • Needs to abide by mandates of: – Title VII, 1964 Civil Rights Act – Equal Pay Act of 1963 – ADEA of 1967 Copyright © 2015 Pearson Education, Inc. 8-22 The Merit Pay Grid • Amounts are determined by two factors – Performance ratings – Position of employees’ present base pay rates within pay ranges Copyright © 2015 Pearson Education, Inc. 8-23 Increases within Budget • Determine performance categories and percentage of employees in each • Place percent in quartiles • Put percent and quartiles into cells • Estimate performance distribution • Distribute increase to each cell • Ensure total is within budget Copyright © 2015 Pearson Education, Inc. 8-24 Learning Objective 4 Explain at least two sales compensation plan design considerations. Copyright © 2015 Pearson Education, Inc. 8-25 Sales Objectives • Improve sales productivity • Improve sales coverage of current customers • Grow sales overall Copyright © 2015 Pearson Education, Inc. 8-26 Sales Compensation Plans • Salary only • Salary plus bonus • Salary plus commission • Commission plus draw • Commission only Copyright © 2015 Pearson Education, Inc. 8-27 Salary-Only Plans • Fixed base compensation • From the employees’ perspective  risk-free • From a company’s perspective  burdensome Copyright © 2015 Pearson Education, Inc. 8-28 Salary-Plus-Bonus Plans • Set salary coupled with a bonus • Bonuses usually are single payment Copyright © 2015 Pearson Education, Inc. 8-29 Salary-Plus-Commission Plans • Commissions based on percentage of price • Spreads risks • Designed to attract quality sellers • Allows employees to do other tasks Copyright © 2015 Pearson Education, Inc. 8-30 Commission-Plus Draw Plans • Draw – Advance pay for living expenses – Charged against future commissions – Recoverable or non recoverable • Provides strong incentive to excel Copyright © 2015 Pearson Education, Inc. 8-31 Commission Only • Straight – Based on fixed percentage of sales price – Ex: 10% commission, service sold $100  $10 • Graduated – Increased percentage rates for higher sales volume – Ex: 5% commission, per unit for 100 units  8% commission per unit from 101 to 500, 12% commission per unit in excess of 500 Copyright © 2015 Pearson Education, Inc. 8-32 Commission Only (cont’d) • Multi-tiered – Increased percentage rates for meeting and exceeding sales goal – Ex: 8% if total sales volume < 1,000 units, 12% if total sales volume >1000 units Copyright © 2015 Pearson Education, Inc. 8-33 Fixed Pay and Compensation Mix Three main factors • Salesperson’s influence on decision • Competitive pay standards within industry • Amount of nonsales duties Copyright © 2015 Pearson Education, Inc. 8-34 Learning Objective 5 Describe three main considerations of person-focused pay program design. Copyright © 2015 Pearson Education, Inc. 8-35 Skill Blocks • Include job descriptions – Skills needed – Training required – Accurate evaluation process • Organize jobs into family/group – List similar skills and tasks per job • Group skills into blocks Copyright © 2015 Pearson Education, Inc. 8-36 Transition Matters Job-based pay to person-focused pay • Assessment of skills – Who assesses – On what – How often • Align pay with knowledge structure • Access to training – Equal access to all Copyright © 2015 Pearson Education, Inc. 8-37 In-House vs. Outsourced Training • Expertise – Needed and available • Timeliness – How soon and how often? • Number of trainees • Proprietary nature of topic – Too sensitive to share? Copyright © 2015 Pearson Education, Inc. 8-38 Learning Objective 6 Present a summary of two pay structure variation practices. Copyright © 2015 Pearson Education, Inc. 8-39 Broadbands and Pay Grades Copyright © 2015 Pearson Education, Inc. 8-40 Two-Tier Wage Structure Copyright © 2015 Pearson Education, Inc. 8-41 Sample Skill Block Copyright © 2015 Pearson Education, Inc. 8-42 Broadbanding • Consolidates pay grades and ranges • Flattens corporate hierarchies • Emphasizes teamwork • Broadens job duties and responsibilities • Promotes quicker decision making • More latitude in pay rate decisions Copyright © 2015 Pearson Education, Inc. 8-43 Two-Tiered Pay • New employees paid less • Temporary or permanent rewards • Mainly in unionized companies • May hinder recruiting • Can lower employees’ morale Copyright © 2015 Pearson Education, Inc. 8-44 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2015 Pearson Education, Inc. 8-45 ...
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Tutor Answer

Robert__F
School: Rice University

Good luck in your study and if you need any further help in your assignments, please let me know Can you please confirm if you have received the work? Once again, thanks for allowing me to help you R MESSAGE TO STUDYPOOL NO OUTLINE IS NEEDED AS IT IS A DISCUSSION

Running head: PAY GRADES
Topic: Pay Grades
Student name:
Instructor name:
Course name:
Date:

Pay Grades

2

Pay grades limit a company’s ability to achieve competitive advantage.” Do you agree?
I oppose the notion that p...

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Anonymous
Thank you! Reasonably priced given the quality not just of the tutors but the moderators too. They were helpful and accommodating given my needs.

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