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Design study of the company's compensation system

Author: GuanLi From: www.yourpaper.net Posted: 2010-02-22 15:53:14 Read:
Abstract: enterprise to attract and retain high-quality employees, motivate them to work hard, must have a sound remuneration system. Integrated multidisciplinary research. Combination of theoretical and empirical, qualitative research and quantitative research combined method analysis of the design principles applicable to its characteristics from a strategic and technical levels, combined with strong actual situation of Metal Products Co., Ltd., the design step, the salary system for its The purpose of pay system more scientific, standardized play an effective role in guiding, and ultimately achieve a clear corporate strategic intent to improve the core competitiveness of enterprises.
Keywords: small and medium-sized enterprises; pay system; design

1 Background

Judging from the current situation, most of our SMEs lack a system of human resource management functions, human capital incentive mechanism is not fully developed. The main problems of incentives incentives single heavy the material incentives light inspired by the spirit.

The 2 Cases background

Strong Metal Products Co., Ltd. is a manufacturer of cold-rolled strip business. The rapid development of enterprises, and has a strong competitive advantage in the local industry. The company attached great importance to attract talent, from the initial construction, has been in gradual establishment of an employment mechanism: focus on recruiting new graduates.
However, with the rapid development of enterprises, their internal management issues also will appear. Which is a huge loss of the most vexing is the talent. The loss of middle managers, it means that a large number of skilled workers was taken away, although this influenced by the characteristics of the industry. But the fundamental reason is companies do not keep people off ", just to attract talent in it. Will not only increase the human costs, also affect the production efficiency. I found in the company for three months: the remuneration of management of the company there is a big problem, high salaries and did not play a good incentive effects, but inviting the cost.

The pay system analysis

Analysis of the payroll of recent months, combined with the reaction of the company staff can be found, its pay system exists the following question;

3.1 external remuneration structure is irrational
External remuneration is generally constituted by two parts of fixed remuneration and variable remuneration. The fixed remuneration generally refers to the basic wage, the skills needed by the job, knowledge, difficulty of the operation decided to variable compensation generally pay for performance, performance in the form of bonuses, allowances, determined by the performance of their staff. In general, the fixed remuneration and variable remuneration should maintain a certain ratio. Fixed remuneration is too high, easy to motivate employees to produce laziness psychological; ratio is too low, staff unrest psychological and easy to make.
Strong of Metal Products Co., Ltd. to focus only on the employees' sense of security, basic wages are relatively high, causing employees to form a "time-consuming" psychological, many employees hold such a thought, "Anyway, I here give a day's wage for the day, the office undisciplined sabotage phenomenon is very serious.

3.2 Remuneration system is imperfect, emphasizing external remuneration. Neglect the inherent remuneration
The company built in the early period, the staff is mostly local academic, not very high quality, experienced people. However, with the development of enterprises, the company began to focus on the introduction of highly educated people, but did not change the salary management system. Or that high salaries will be able to retain talent. Does not know that high salaries are no longer the key factors that affect the fate of the employees, especially for fresh graduates, they pay more attention to the internal remuneration is recognized work, learning and development opportunities in the work. I contact with them: when they feel their own contribution to the enterprise has not been fully recognized and rewarded in the course of their work dissatisfied, they will choose to leave. Existing salary system ignores this not only resulted in the loss of a large number of the company's personnel, the economic losses caused to the company at the same time.

3.3 Remuneration not "move up" Remuneration and performance of the association is not strong
Strong Metal Products Co., Ltd. with a key performance indicator assessment methods, and 5S management method, performance appraisal, training personnel to participate in the company, is to spend lots of money to set up performance appraisal team and performance appraisal Commissioner. However, staff remuneration and performance management foundation is weak, not a strong correlation. The company in the pay structure of pay for performance, but the performance did not really pay-linked employees pay extremely rigid, there is no better performance out of the incentive pay. A result, the company increased operating costs, but the effect of management but did not improve.

Pay system design

Departure from the requirements of the modern enterprise human resources development and management, and by strong up to adjust the timing of Metal Products Co., Ltd. management system and organization, improve the supporting system reform, strengthening the effective management of the basic work, really establish the business management, professional technology and skills to operate the three allocation sequence, production and management company, and the role and contribution of the reform and development efforts to achieve by all categories of personnel to determine the focus of the salary distribution, the substantial increase in pay income levels in key staff positions, to make various types of remuneration income reflect the true value of their labor, to further optimize the structure of wages, the implementation of the pay system effectively "Strengthening the core, stable backbone motivate all the" important role, and gradually form a market-oriented, relying on efficiency, both in line with the pay system design development trends, and adapt to achieve sustainable and effective development strategy requires that strong of Metal Products Co., Ltd., has both internal consistency, and improve the external competitiveness of the remuneration system. The 4.1 external remuneration system design
(1) senior management remuneration system.
Salary structure: post salary performance pay benefits system. Ratio: 50% (fixed) 50% (floating). Performance pay for senior and middle management of its day-to-day assessment of the results of operations in the office sector. Considering the overall effectiveness of the unit, the unit key performance indicators and individual performance indicators integrated assessment and payment of performance pay, according to the results of the assessment.
Its welfare system for the post of "social insurance benefits optional benefits." Social insurance according to industry competitors, including: unemployment insurance, medical insurance, pension insurance. Duties norms, such as: company cars, housing allowances and other benefits in accordance with corporate requirements. Reference to the approach of the senior management in accordance with the actual situation of the enterprise, and gradually Trial optional benefits, for example; travel, paid vacation. In the specific implementation process, some optional benefits and business benefits linked among layer management staff to achieve the mission objectives only enjoy the content of this plan.
(2) the general management personnel remuneration system.
Salary structure: post salary performance pay benefits system. Ratio: 70% (fixed) 30% (floating). The pay-for-performance of the general management of its day-to-day assessment of the results of operations in the office sector. Considering the overall effectiveness of the unit, the unit key performance indicators and individual performance indicators integrated assessment and payment of performance pay, according to the results of the assessment.
Welfare system for social insurance optional benefits. " Social insurance is determined according to the situation of the enterprise and industry, including general management of social insurance: unemployment insurance, medical insurance, pension insurance. In accordance with the actual situation of the enterprise, the conditions are ripe, and gradually Trial optional benefits, such as: training, vacations, travel. In the design of the welfare system, managed welfare of employees and company business objectives linked only to enjoy the content of this plan, the parties to achieve the mission objectives before.
(3) professional and technical personnel salary system.
Salary structure: post salary performance pay benefits system. Ratio: 60% (fixed) 40% (floating). Performance pay for professional and technical personnel, examination of their day-to-day work in the serving department. Considering the overall effectiveness of the unit, the unit key performance indicators and individual performance indicators integrated assessment and payment of performance pay, according to the results of the assessment. In the design of performance-based pay, to mobilize the enthusiasm of the professional and technical personnel, professional and technical transformation of commission, the application of new technology commission, technical support in the process of production and operation, production and operation of the guarantee such as key performance indicators for the evaluation after issuance.
Its welfare system: social insurance optional benefits. Social insurance with reference to the competitors in the industry. Combine the characteristics of enterprises and workers, including: work-related injury insurance, medical insurance, pension insurance. In accordance with the actual situation of the enterprise, and gradually Trial optional benefits, such as: training, transfer Kong.
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