Compensation Strategy Essay Example | Topics and Well Written Essays - 1000 words

Compensation Strategy - Essay ExampleHowever, any pay system must bear the interest and goals of the company and the employee. As such, to achieve this balance, variant hire strategies wear uniquely in a given company. This paper highlights and evaluates three earnings strategies that can apply in our manufacturing company. Moreover, it will recommend the modes of applying these compensation strategies while considering the company and employees interests. Introduction A compensation strategy refers to the planned utilization of the pay system as a fundamental integrating mechanism pitch towards achieving company objectives and rewarding employees subject to limitations at heart the company (Gomez-Mejia, Berrone, & Franco-Santos, 2010). As the human resources manager in our manufacturing company, I have the mandate of evaluating the different compensation strategies that are available for adoption within our organization. Actually, the best compensation strategy will ensure at traction and retention of critical employees. Our manufacturing company has 120 employees and various compensation strategies can apply to them. The compensation strategies that I will evaluate in this paper include the warring strategy, Retention-based strategy, and the performance- based strategy. I will hence compare and contrast them with an aim of applying them in our organization. Indeed, the compensation strategies should be reasonable to both the employees and the company itself (Deb, 2009). I will on that pointfore determine recommendations on how to implement them within our organization. Research findings I have done substantial research on the three compensation strategies and poised relevant information that can help in the application of these strategies in our manufacturing company. Most specifically, in the agonistical strategy, the company pays employees the market rate. On the other hand, in the retention-based strategy, the employees earn more as they stay in the company. Additionally, in the performance- based strategy, the pay relates to the performance of an employee, the team or the entire organization. Specific findings on severally compensation strategy follow here in. Findings on the competitive strategy It is notable that one of the master(prenominal) goals of any company is to remain competitive in the market and where possible gain competitive benefit over other competitors (Kumar, 2010). As such, the competitive strategy seeks to retain existing employees in offering them rewards that enough to industry standards. Additionally, this compensation strategy seeks to attract potential employees by motivating them to join the company as it offers compensation that meets what others in the industry offer (Petroleum Human Resources Council of Canada, 2012). Nevertheless, the competitive strategy offers the reference company no competitive advantage over its competitors since its compensation rates are at par with those of its com petitors. Hence, this strategy whitethorn not motivate employees to remain in the company for a long time. Indeed, this strategy keeps the management at risk of fluctuating wages, as the industry would dictate. As such, where the company cannot keep up with the escalating wages, then there is a high risk of employee turnover. Moreover, the existing employees are at a high risk of divergence the company if another company offers higher rewards than the reference com