BUS434 Week 3 Assignment 1

BUS434 Week 3 Assignment

Name

Course

Instructor

Date
BUS434 Week 3 Assignment 2

Designing a Compensation Package

Using the job description and evaluation method that you created for the exercises in Weeks 2 &
3, and the feedback from peers, design a proposal for a competitive compensation package for
the position, including the following elements:

 Job description
 Method of Job evaluation
 Intrinsic and extrinsic benefits
 Compensation package and rationale for same
 How performance will be measured
 Why the proposal you have created is appropriate for the market at this time.
 Compensation strategy.

The proposal should be formatted in accordance with APA, 6th edition, and the guidelines of the
template provided at the Writing Center (Links to an external site.). It should be between 2000 –
2500 words in length excluding title page and references. Be sure to include at least six
scholarly and/or popular sources, one of which must be the course text

Carefully review the Grading Rubric (Links to an external site.) for the criteria that will be used
to evaluate your assignment.
BUS434 Week 3 Assignment 3

Introduction

In the scheming of a compensation package, the establishment have to value the

impartiality impression by undoubtedly defining the wage and salary discrepancy and career

growth strategies, this will foster a sort of encouragement and motivation for the human

resource to perform better at their responsibilities. Depending on the forms the company is

using for compensation from salary, hourly pay, commission, and bonuses exist as direct

compensation strategies while else there are also indirect strategies such as benefits, and

equity-based programs which are essential to the plan and the employees at large as they will

feel valued which encourages the good attitude towards work. These factors must be

considered when addressing the compensation plan as in any organization they must apply

most of them if not all. This is implemented by developing a discipline that the plan that must

align itself, gathering information from different sources, and benchmarking from external

and internal situations within a similar industry. Creating a job description for all employees

will institute the pay structure and will help determine the payment of the structure (Handal,

& Amazon.com 2012).

This plan is important in the form that it dictates the conduct of the employees as they

are the reimbursements that they receive after fulfilling the requirements of the organization

on the responsibilities assigned to them. When an employee is not satisfied it will always

affect their productivity at work due to the psychological torture of unfulfilled basic needs.

For this proposal, I will focus on the several elements that constitute designing a

compensation package including; job description, method of job evaluation, intrinsic and
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extrinsic benefits, compensation package and rationale for same, measurement of

performance for the personnel, appropriateness of the proposal, and compensation strategy.

Job Description

This is a statement that outlines the specifics of a particular job or position within an

organization explaining the responsibilities and functions of the individual on the said task.

The details included in the job description are the tasks, duties, the type of responsibilities, the

procedure for handling the said work, and the frequency and purpose of the work about the

company’s vision and mission. It guarantees that the company will have its needs met through

the recruiting of the employees with the required skills and experience to move the company

forward. Reduction of conflicts within the line of work between colleagues and management

is enhanced as the staff does not have to wait for directions from the supervisors. The tool will

also help in determining the ranges for the wages, levels, and grades equitably as it is arrived

at through the roles that are assigned to that work. The job description reinforces the

employment contract by pointing out what the administration needs from the operative, this

constitutes the basis of all employer-employee interactions leading to appraisal, development,

pay, and succession discussions which activities are done on a job evaluation thus describing

how the evaluation relies upon the description (Gitman, McDaniel, Shah, Reece, Koffel,

Talsma, Hyatt, 2018).

A clear and precise job description will form the foundation upon which the

compensation of strategy will be drafted as it’s the document that reflects the qualification

required, tasks are undertaken, and levels involved and thus an employee will receive the

compensation that is well deserved. Having these systems in place assists the employees and
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potential candidates in the identification of the expectations and requirements of their duties

and the benefits that they get in return which is also important to candidates when choosing

the appropriate company to join depending on the favorable benefits that are offered.

Method of Evaluation

Organizational development is very important to every administration as it acts as

collateral towards keeping the job. When a company reports losses every time is assessed, the

chances of closure are always high and thus loss of jobs to the people that are employed. For

this reason, it is important for management to have the staff at peace. Evaluation is a tool

employers apply to examine the performance of a member of staff. It is required to confirm

whether the aims and targets being conventional are accomplished, assess whether the

employees are adapting to the environment, and help the management make decisions

regarding promotions, pay raises, and layoffs. The main evaluation methods include goal-

based, process-based, and outcome-based evaluation.

A goal-based evaluation is a technique used in the determination of the definite

conclusion of a certain mission when equated to the set objectives of the initial proposal. This

will enable the company to improve on the achievement course and help in the

reconfiguration of the ineffective individuals. Process-based are used to help one comprehend

how a program works and the way it delivers its outcomes, this helps all the people involved

to see the results in different fields and performances. Outcome-based is the actual valuation

of the extent of outcomes and displays the changes that are necessary to make in the

organization. Job evaluation is done to in preparedness for making the job description that is

aimed at achieving an impartial and vindicated wage system in a group. It is also a part of the
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compensation package as it serves as a determining factor for the relative value of one job

about another. The compensation system relies on the details that are in the job evaluation for

the accuracy of its statistics (Stuart, Maynard, & Rouncefield, 2015).

Intrinsic and Extrinsic Benefits

Intrinsic benefits are the mental rewards that workforces get from undertaking

evocative exertion and accomplishing it in order, they rely on the inner person as achieving

them does not count on the external forces but just the individual’s behavior. For instance,

participating in a team-building event, not necessarily due to the free day that you get from

work but because it is good for your health and helps in boosting the relationship between the

employees and management. Extrinsic benefits are the physical rewards that employees

receive for a good performance such as promotions, pay raises, bonuses, and benefits. It the

dependent on the performance of the individual at their station of work and is affected by

other people other than yourself.

Compensation Package and Rationale

A compensation package is a whole compendium of the salary, benefits, bonuses

allowances, and commissions that come with using the job. It comprises either annual salary,

hourly wages, bonus payments, health care coverage, retirement contributions, and short-term

disability insurance among other benefits. When compensation is done to the personnel at

work they are rejuvenated when they are coming to work and the level of job satisfaction

rises. The morale is enhanced in the process and increased production is realized. The

rationale for compensation is a strategy for showing the employees that the company has
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invested in them for instance in their health and future in terms of retirement benefits. These

choices are based on individual predilections, principles, and limitations, this becomes

possible for the employees to give out their best outcomes in the responsibilities given to

them. Through these benefits, it makes the employees contented and this reflects on the

production as it improved due to motivation, it will also have to enhance a competitive

balance because some of the benefits may include offering education programs. Improving

retention as the company will attract and invest in the success of the employees will ensure

that the talented candidates are enrolled and maintained Weathington, & Weathington, 2020).

Performance Measurement

This is the method of accumulating, evaluating, and reporting data concerning the

performance of an individual, group, or organization. In technical terms, a performance

measure is a quantifiable expression of the amount, cost, or result of activities that indicate

how much, how well, and at what level, products or services are provided to customers during

a given period. Performance measurement needs to involve both senior management who

understand the long-range goals of the organization, and front-line staff who know the kinds

of measures needed for thoughtful decision making (Daberto, 2008). Although there is no

perfect set of measures, organizations should experiment with a starter set of metrics and

evolve these measures over time. The biggest challenges in measurement are not in the

collection and analysis of data, but in the interpretation of results and making decisions

based on the information. Education is an essential part of all measurements. Knowing what

to measure, how to measure, how to use measurement, and how to link these measures to

other knowledge of organizational performance are critical to the successful use of

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performance measurement. Provide training to the teams on how to do this and set up a

process for reporting, reviewing, and improving. The main objective of performance

measurement is to help the administration set truthful objectives that are achievable by the

workforce. Instead of setting the bar too high or below average, for accuracy in how the work

is done a job performance measurement is important to undertake. Leadership is critical in

designing and deploying effective performance measurement systems There are five main

methods of performance measurement that include; input, output, efficiency, quality, and

outcome.

Input monitors the amount of capital that is set for a certain task to advance, sustain, or

deliver merchandise, action, or amenity. This becomes the start point of the process which is

necessary for comparison to the output. When the input is more than the output then that

becomes an unhealthy business as inputs should always be less than output to indicate

progress. Output monitors the results of what was produced for instance in a production

process the number of items produced among others. The output in any organization or

company is the main schema as it sustains the business regardless of the company outputs the

information, products, or reports, this is what keeps them in business. Efficiency is the factor

that displays how the task is performed and the resources required to perform the task. This is

a measure of the output of the company divided by the input. Quality is the extent of values

for measuring the performance of how the work is performed by the employee. It also caters

to safety and effectiveness, timeliness, and fairness (Gray, Micheli, & Pavlov, 2014).

Performance outcome is used as a management tool to indicate the goals, document

contributions towards achieving the objective and document the benefits of the program and
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the services to clients. Through following and investigation of information, recommendation

supervision, steadily storing applicant requirements, developing valuation and past

information, attendance monitoring, and identification of tracking of key trends are methods

to show outcomes.

Importance of the Job Proposal

A job proposal is a brief document that categorizes a subject within an organization

and pronounces how the skills and experience of job seekers can help to resolve it. This will

help to showcase how the business is doing to prospective investors, the benefits that may

accrue to them if they decide to invest, the exceptionality of the concepts, and the reason

potential buyers may want to show with you. For this study, the proposal will demonstrate the

quality and importance of creating a compensation package and how it will be conducted. It

will also give a prospect to contemplate the research question. It will also entail wide-ranging

information regarding the elements that are significant in the coming up of a competitive

compensation package for a position of a business manager. The proposal for this market will

assist in better planning, building consensus, more research, planning for monitoring and

evaluation, improved marketing, and getting everything in writing. It sets the foundation for

recruiting, developing, and retaining talent and also sets the stage for optimum work

performance by clarifying responsibilities, expected results, and evaluation of performance.

The proposal will be aimed to demonstrate to the company the type of employees required

and their qualifications (Rogers, In Rogers, & In Lamb, 2015).

BUS434 Week 3 Assignment 10

Compensation Strategy

A compensation strategy is a method that is functional for the corporation to

recompense its staff. Takes a strong compensation strategy is required to attract and retain

people who have the appropriate knowledge, skills, aptitudes, competencies, and attitudes to

get the job done. One way to establish a framework for compensation is to determine pay

grades based on job position and duties. For example, positions in pay grade one may be for

entry-level roles, pay grade two for technician roles, pay grade three for managers, and pay

grade four for executives (Frey, 2012). There are three basic compensation strategies namely;

leading the market, is the tactic of offering a better compensation plan than all your other

competitors to make sure that the experienced and skilled employees are enrolled and

maintained at the organization. Matching the market means that after surveying how other

companies with the same job levels and qualifications benefit and equal the same to your

employees to maintain them as they will not have a reason to leave.

Lagging the market is also a strategy applied to compensation which simply means

that the compensation payment is below the expected. Although, this idea will rob you of the

best skilled and experienced employees as they will tend to reach out to the companies with a

good compensation plan. Having an established compensation strategy contributes to your

ability to predict costs for hiring new employees and providing salary increases. It also helps

to avoid situations where pay decisions may be inconsistently applied. The strategy will align

all the business objectives and remuneration principles with corporate culture and employees.

The compensation strategy is extremely important as the right compensation strategy helps to
BUS434 Week 3 Assignment 11

build an effective and competitive organization and the wrong setting of the compensation

strategy, which does not fit with the needs of the organization and with the HR and Business

Strategies, can destroy the organization within several years and the organization suffers from

decreased performance and not utilizing the full potential of employees.

BUS434 Week 3 Assignment 12
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References

Daberto, M. (2008). Selecting compensation as an element to illustrate the difficulties

multinational companies face in utilising expatriates.

Frey, R. S. (2012). Successful proposal strategies for small businesses: Using knowledge

management to win government, private-sector, and international contracts.

Gitman, L. J., McDaniel, C., Shah, A. J., Reece, M., Koffel, L., Talsma, B., Hyatt, J. C., ...

OpenStax College,. (2018). Introduction to business.

Gray, D., Micheli, P., & Pavlov, A. (2014). Measurement madness: Recognizing and

avoiding the pitfalls of performance management.

Handal, M., & Amazon.com (Firm). (2012). Proposal development secrets: Win more, work

smarter, and get home on time. Place of publication not identified: Sold by Amazon

Digital Services.

Rogers, I. I. I. J. C., Academy of Marketing Science,, In Rogers, I. I. I. J. C., & In Lamb, J. C.

W. (2015). Proceedings of the 1983 Academy of Marketing Science (AMS) Annual

Conference.

Stuart, K., Maynard, L., & Rouncefield, C. (2015). Evaluation practice for projects with

young people: A guide to creative research.

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Weathington, B. L. & Weathington, J. G. (2020). Compensation and benefits: Aligning

rewards with strategy, updated edition. Zovio.