Term
| Considerations for Compensation Decisions |
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Definition
Which factors determine salary ranges for jobs
Best ways to determine how much employees should be paid
How much pay should be guaranteed and how much based on incentive |
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Term
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Definition
Monetary rewards
Direct compensation includes hourly wages, salaries, incentives, merit raises, bonuses, and commissions
Nonmonetary rewards
Indirect compensation includes health care benefits, vacations, lunches, training, etc.
“Total Rewards” equals the total compensation package employees receive |
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Term
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Definition
Employees compare their input (work effort) and outcomes (wages) to others in similar situations
Employees are motivated to work harder when compensation is at the right level for the work performed
When employees are faced with “inequity” they will try to resolve it by:
Stop working as hard as they once did
Rationalizing why there is inequity
Quit their jobs
Inequity can exist within a labor market or within the firm itself |
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Term
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Definition
Each job in a company is valued appropriately relative to every other job
Relative worth hierarchy is established
Pay rates are assigned to jobs
Process is done through job evaluation:
Job ranking
Job classification
Point factor
Factor comparison |
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Term
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Definition
Reviewing job descriptions and listing jobs in order from highest to lowest worth to company
Fairly hard to do in a large company
Need to create a framework to process the information found in all the job descriptions
Largely subjective |
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Term
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Definition
Developing broad descriptions for groups of jobs that are similar in terms of tasks, duties, responsibilities and qualifications
Wage range is attached to each classification reflecting relative worth of the job in that classification
Sometimes managers want to reclassify jobs to give a particular employee a higher salary |
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Term
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Definition
Quantitative approach that uses a point value scheme resulting in a score for each job
Begins with identifying a set of factors for which the company is willing to pay—called “compensable factors”
Point manual contains description of each factor and what each degree of the factor represents
Job grade – grouping jobs with comparable points together to reflect the hierarchy of jobs within a firm |
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Term
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Definition
A job that represents the range of the types of jobs in the company. These jobs need to be:
Stable over time in terms of their responsibilities
Well known and recognized
Clearly and concisely described
Accepted in the external labor market for setting wages
Currently at an appropriate wage rate
Scores for these jobs enable the company to compare other jobs to the benchmark jobs and determine which should be paid more or less |
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Term
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Definition
Ranking benchmark jobs in relation to each other on factors like mental or physical requirements, skill, responsibility, and working conditions
Combines job ranking and the point method
Monetary rates are included, so as the market changes, it needs to be updated |
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Term
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Definition
Ensures jobs are valued appropriately relative to similar jobs in the external labor market
Affects how attractive the firm is to potential employees
Also affects attitude and motivation of current employees |
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Term
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Definition
Provides a systematic way to collect information about wages in the external labor market
Companies can conduct their own surveys or purchase survey data
Should look at companies in same industry and other industries that might be competing with you for employees
Should come from appropriate geographic labor market |
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Term
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Definition
Systematic process of assigning monetary rates to jobs so that internal wages are aligned with external wages in the marketplace
Begins with plotting results of salary survey for benchmark jobs
Market line, also know as wage curve, is drawn to represent relationship between job evaluation points and salaries paid for jobs
Plot actual salaries paid for benchmark jobs and compare them to results from market |
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Term
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Definition
If company’s wage curve is below or above the market wage curve, decisions have to made about whether to move wages or leave them as is
Firms can pay at the market level (follow), above the market (lead), or below the market (lag)
Companies paying below market will have a harder time attracting employees |
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Term
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Definition
Jobs are grouped into job grades associated with a pay range
Each range has a midpoint, a minimum, and a maximum
Midpoints represents an employee who is fully qualified and functioning at an acceptable level of performance
Ranges will have overlap—the less overlap the more difference between jobs in each grade |
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Term
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Definition
Consolidates a large number of pay grades into a few “broad” bands, usually 3 to 10
Maximum pay for a particular band can be as much as 100-400% above the band’s minimum pay
Bands are usually wide enough that changes in the market don’t require adjustments as often |
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Term
| Pay for Individual Performance |
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Definition
Initial pay based on person’s previous experience, education and negotiating skills
Increases can be tied to meeting goals, providing higher levels of service or results of performance appraisal
Red circled job — person being paid above the maximum wage for grade
Green circled job — person being paid below minimum of grade
Manager can adjust salary, reclassify or reevaluate the job |
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Term
| Skill Based Pay and Knowledge Based Pay |
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Definition
Require employees to acquire certain skills or knowledge to receive an increase
Makes it clear what employees have to do to increase pay
May have more employees at higher levels of mastery than needed |
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Term
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Definition
Identify the competencies (attitudes, behaviors, abilities) employees need to master for pay raises
Managers need to outline valid process to determine achievement of competencies
Can lead to higher labor costs or employee frustration if they do not use additional training |
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Term
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Definition
Collecting salary information from external labor market rather than starting with internal structure based on value of jobs
Works well as long as data is accurate |
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Term
| Administering Compensation |
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Definition
Anyone making employee pay decisions needs to receive training
How pay rates are set and raises are determined
How frequently they are reviewed
What can and cannot be communicated to employees
Closed system — details about individual pay rates not made public except as required by law (high-ranking executives)
Open system — pay information is public (school districts with published pay scales)
Communication will enhance employees’ perceptions of equity and justice |
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Term
| Organizational Demands and Compensation |
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Definition
Internal value of jobs — strategy will determine tasks, duties, and responsibilities a firm considers most valuable in achieving its goals
Ways to increase employee base pay:
Cost-of-living adjustments (COLAs) — keep salaries from lagging behind external market and to offset rise in prices of goods and services (uses CPI)
Merit increases — salary increase based on how well employee has performed
Variable pay — includes bonuses, commissions, and stock options |
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Term
| Company Characteristics and Compensation |
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Definition
Company’s strategy will determine the mix of base and variable pay as well as monetary and nonmonetary awards
Small firms may pay less-than-market wages
Established firms have more resources to pay at or above market
Whether a job is a core job or a support position affects pay decisions |
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Term
| Company Characteristics and Compensation (Continued) |
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Definition
Larger companies have more resources and more complex pay systems
Company culture establishes the priorities for the pay policy (i.e., if firm values teamwork, teamwork will be rewarded)
Managers need to communicate pay decisions and know what types of rewards are valued by employees |
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Term
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Definition
Not all jobs require equal knowledge, skills, and abilities or have equal levels of responsibility
Employees need to understand the process (procedural justice) and believe the outcomes (distributive justice) of compensation decisions are fair
Employees’ perceptions of fairness in compensation is also impacted by relationship with manager
Salary compression — occurs when pay for jobs in external market rise faster than pay inside the organization (affected by shortage of workers) |
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Term
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Definition
Labor supply — when market is tight, companies have to pay higher wages to attract and retain employees
Pay philosophy — decision to follow, lead, or lag the market
Leading the market helps a firm attract more qualified workers
A firm may lead the market in certain critical jobs
Pay practices need to match employee pay preferences
Technology enables easier collection of salary data |
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Term
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Definition
Access or conduct online salary surveys
Simplify job evaluation and maintain compensation records
Collect timesheets and interface with payroll systems |
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Term
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Definition
Decisions need to be made about centralized or decentralized approach to compensation
Employees in companies with centralized approach are more satisfied
Employees see link between results and rewards and more internal and external equity
Laws and norms of countries will affect certain pay practices |
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Term
| Globalization (continued) |
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Definition
Paying PCNs (parent country nationals) typically are kept “whole”
Use balance sheet approach—making adjustments for hardship, dangerous, or primitive assignments
U.S. companies have been criticized for paying low wages relative to American wages
Cost of living and minimum wage laws have to be taken into consideration to do comparison |
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Term
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Definition
“What gets rewarded, gets done”
Sort-term goals that are easily manipulated will tempt employees to engage in unethical behavior
Living wage — providing a fair wage so that basic living needs can be met
Employers must pay the mandated minimum wage |
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Term
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Definition
Comparable worth — eliminating gender inequity in wages because jobs held by women have traditionally been underpaid relative to similar jobs held by men
Jobs that require similar levels of education and experience and have other characteristics in common should be paid a similar wage
Equal Pay Act requires equal pay for jobs that are substantially the same |
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Term
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Definition
Davis-Bacon Act — requires contractors of Federal government to pay workers wages and benefits equal to local prevailing wages and benefits
Walsh-Healey Act — requires contractors to pay federal minimum wage and 1.5 times the minimum over 40 hours worked in the week
Fair Labor Standards Act (FLSA) — regulates use of child labor, defines which workers must be paid the minimum wage, and stipulates pay rate for overtime work |
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Term
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Definition
Minimum wage — Federal minimum is $7.25 an hour as of July 2009, but each state has option of setting its own minimum www.dol.gov/esa/minwage/america
Exempt employees — do not receive overtime for hours worked in excess of 40 in a workweek
FairPay Overtime Initiative (2006) clarified which employees were eligible to be exempt and many jobs were reclassified |
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Term
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Definition
Youth under the age of 16 can work on restricted basis
Youth 16 and older have no work-hour restrictions, but cannot work in hazardous jobs if they are under 18 including driving a motor vehicle, doing wrecking and demolition, or being exposed to radioactive substances |
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Term
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Definition
Employers must keep certain information on nonexempt employees including:
Name, address and Social Security Number
Birth date, gender, occupation
Hours worked
Rate of pay and overtime earnings
Additions and deductions from pay
Wages, (by pay period, dates, etc.) |
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Term
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Definition
Reinforcement theory — people are likely to repeat actions that resulted in positive consequences
Goal setting theory — employees are likely to achieve challenging, specific, and attainable goals that they have set for themselves |
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Term
| Motivation Theories (continued) |
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Definition
Expectancy theory — employees will make decisions about work actions based on which behaviors will lead to rewards
Expectancy — the degree to which employees believe they will be able to achieve the objective
Instrumentality — employees believe that achieving the objective will be rewarded
Valence — the degree of value employees place on different rewards
Agency theory — managers motivate their employees to act in certain ways by aligning their interest with the firm’s other stakeholders (e.g. the owners) |
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Term
| Types of Incentive Plans Individual |
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Definition
Merit Pay Programs — employees receive a compensation adjustment based on results of their performance evaluation
Permanently raises base salary and company’s costs
Rewards employees for past performance
Might appear insignificant when spread out over 52 paychecks
Lump-Sum Merit Bonuses — one-time payment for performance not rolled into employees’ salaries |
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Term
| Types of Incentive Plans Individual (Continued) |
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Definition
Piecework Incentive Plans — reward employees for future performance
Straight piecework plan —receive a certain rate of pay for each unit produced
Differential piecework plan —the pay received per unit produced changes at certain levels of output
Employees may focus only on aspects of job that get rewarded |
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Term
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Definition
Used to encourage employees to work toward specific outcomes
Manager gives awards “on the spot” when they see certain behaviors exhibited by employees
Can be cash or non-cash like merchandise, gift certificates, paid time off, etc.
Recognition programs like employee-of-the-month can also be used |
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Term
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Definition
Straight commission plan — pays an employee a percentage of the total sales they generate
Straight salary plans — employees receive a set compensation (employees may not be as motivated to sell as much as they can)
Mixed salary/commission plan —employees receive a lower base salary (50%) and the remaining is commission based |
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Term
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Definition
All members are rewarded when team reaches or exceeds its target objectives
Potential for “free riders” who do not work as hard as others
Gain sharing plans —designed to help increase a company’s efficiency by rewarding teams that exceed productivity levels with a share of the gains realized |
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Term
| Examples of Gain Sharing Plans |
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Definition
Scanlon plan — employees make suggestions for how to improve a firm’s productivity and the gains of that efficiency are shared with employees
Improshare plan — based on number of hours a firm expects to reach a certain level of output. If employees reach target in less hours, they receive an equal share of the savings |
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Term
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Definition
Company profits are shared with employees:
Deferred profit sharing — incentive money paid to employees is put into retirement account for them
Encourages collaboration and teamwork
Paid only when a company is doing well
May take a while for employees’ efforts to translate into profits |
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Term
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Definition
Stock option plans — provides employees the right to purchase shares of their company stock at some established price for period of time
Broad-based stock option — plans that apply widely to a firm’s employees
Employee stock ownership plan (ESOP) —company contributes shares of its stock to a trust set up for its employees |
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Term
| Ownership plans (Continued) |
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Definition
Leveraged ESOP — the trust borrows against the company’s future earnings and as debt is repaid, employees receive shares of stock from the trust
Mixed-level plans — multiple incentives that maximize the benefits of each plan and minimize the downsides of each |
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Term
| How to make incentive plans effective |
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Definition
Link plan to firm’s strategic objectives
Have clear standards—predetermined levels of performance
Sample the full performance domain—all aspects of the job
Be attainable
Be easy to understand
Provide meaningful incentives
Evaluate regularly |
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Term
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Definition
Affects what is rewarded
Focus of company should influence which tasks or behaviors are targeted
Low cost strategy may target efficiency for example
Which incentive plans are used
Strategy that requires cooperation and teamwork—group incentive may be appropriate
Cost-focused strategy may use gain sharing plan
May use multiple plans to motivate different employees |
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Term
| Company Characteristics and Incentives |
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Definition
Stage of development and size of a company impact its incentive plans
Small firm may not have high merit pay but use incentives like profit sharing or bonuses to link individual performance to company performance
Incentive plan should be consistent with company values and culture |
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Term
| Employees Acceptance of Incentives |
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Definition
If inconsistencies exist between the plan and company culture, it may result in decreased motivation
Extent to which employees are willing to embrace risks of incentives is influenced by cultural values of company
Perceptions of fairness are affected by standards of incentive plan (how realistic standards are)
Group incentives are impacted by “social loafing”—individuals exert less effort when their actions are combined with others on team |
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Term
| Labor Force Trends and Incentives |
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Definition
Rewarding employees in ways that support and embrace a diverse workforce — spot awards given to managers who recruit and retain diverse employees
Types of rewards may prove more or less valuable depending on age of employees
Some individuals value non-financial incentives like time off or flexible scheduling
Learning and growth are more attractive than money for some employees |
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Term
| Technology and Incentives |
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Definition
Technology influences management of incentives
Use of e-mail notices and administration of plans improves speed of recognition
Technology can reduce costs and enable firms to put more money into programs |
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Term
| Virtual Workforce and Incentives |
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Definition
In order to more effectively track virtual employees, employers may rely on outcome-oriented incentive plans
Plans can be individual or team based |
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Term
| Globalization and Incentives |
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Definition
Different units around the globe may have different objectives
Incentive targets may depend on a country’s infrastructure or social norms
Plans may be customized to fit different regions or countries |
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Term
| Ethics Behavior and Incentives |
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Definition
Incentive systems must be designed to encourage ethical behavior
Plans should include “what” is achieved as well as “how” it is achieved
Sometimes short-term financial performance may encourage unethical behavior
Manager behavior must set an example for employees to follow |
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Term
| Regulatory issues and incentives |
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Definition
Members of protected classes need to have equal access to incentives
Plans must be based on performance not on criteria that is illegal or discriminatory
Managers must take steps to ensure all employees have the opportunity to excel
Stock option backdating —potential problem when companies pick a date when stock is priced low to guarantee profits to executives |
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Term
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Definition
Social Security
Workers’ compensation
Unemployment compensation
Family and medical leave |
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Term
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Definition
First social insurance program implemented in 1937
Purpose is to provide retired workers with continuous income after retirement
Later added provision to cover dependents and survivors, disabled workers, and health insurance for the elderly and disabled
Funded by payroll taxes shared by employer and employee (FICA) |
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Term
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Definition
Provides temporary financial assistance to eligible workers who lose jobs through no fault of their own
Employers are required to pay taxes based on number of claims filed against them
Public employment offices pay out compensation up to 26 weeks
Unemployed workers are required to demonstrate that they are actively seeking reemployment |
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Term
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Definition
Provides cash benefits and medical care to workers when they suffer injuries or illnesses related to employment
Also provides survivor benefits to dependents of workers who die in work-related incidents
Covers medical care, permanent partial or permanent total disability, rehabilitation and training for new jobs
In most states, employers must have coverage regardless of number of people employed |
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Term
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Definition
Health and Wellness
Life Management
Retirement |
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Term
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Definition
Cost of health care benefits continues to increase as individuals live and work longer
Costs are often passed along to employees or result benefits cut
Traditional Plans — include fee for service, employees meet a deductible before plan pays for services
Managed Care Plans (HMOs) — third-party payers negotiate health care options for employee |
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Term
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Definition
Preferred Provider Organizations (PPOs) — an employer negotiates with a network of health care providers for discounts
Point-of-service plan (POS) — employee can decide whether to use a managed plan, or go outside the plan and pay a higher deductible
Consumer-driven health plans (CDHPs) — employees can select a plan with a higher deductible, choose providers, and put money into health savings plan |
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Term
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Definition
High-deductible health plans (HDHPs) —designed to cover major medical problems. Plans are less costly for employers and employees
Health savings accounts (HSAs) — provides a way for employees to pay for immediate health care expenses on a tax-free basis |
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Term
| Health Reimbursement Accounts |
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Definition
Employer sets aside money for HRAs and can deduct costs on their taxes
Accounts are not portable, they remain with employer
Sometimes offered in conjunction with a high deductible health plan to control costs |
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Term
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Definition
Employers avoid having to pay premiums, taxes on premiums, and some of the state requirements for benefits
Employers use services of a third-party administrator to oversee plan
Plans offer employers more flexibility |
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Term
| Prescription Drug Benefits |
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Definition
Companies usually offer a three-tier system: brand-name drugs, generic drugs, and drugs on a formulary list (drugs the insurance company has decided are the most cost-effective)
Another way to cut costs is through a mail-order service |
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Term
| Vision and Dental Insurance |
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Definition
Dental coverage usually includes basic and major restorative care and orthodontia
Vision insurance provides network of optometrists and ophthalmologists usually for eye exams, glasses or contact lenses |
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Term
| Employee Assistance Programs |
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Definition
Designed to help employees cope with mental health issues, substance abuse, and life challenges
Many now include legal services, child-care and elder-care options, budgeting and family counseling |
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Term
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Definition
Short-term disability plans will pay half to two-thirds of employee’s salary for 13-26 weeks
Long-term disability begins after specified number of days (30-90) from time of a disability and pays a portion of employee’s salary until retirement age
Return-to-work programs get employees back on the job as soon as possible |
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Term
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Definition
Accidental death and dismemberment insurance (AD&D) — compensates employees or their families for loss of a body part or death
Life Management Benefits — helps employees achieve balance between home and work responsibilities (child-care, financial planning, paid time off, flexible work schedules, etc.)
Paid Time Off (PTO) — all paid time (vacation, sick days, personal leave, holidays) are grouped as one category—PTO
Educational Assistance — reimburses employees for tuition for approved classes if they achieve certain grades (up to a maximum amount)
Long-Term Care Benefits — provide assistance to aging, disabled, or ill persons for extended period of time
Life Insurance — provides financial protection for employee’s family upon their death
Financial Planning — educates employees on how to manage finances, save for retirement, etc.
Legal Services — provide employees with access to attorneys for assistance with estate planning, adoption, or for legal representation |
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Term
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Definition
Retirement benefits are protected by Employee Retirement Income and Security Act of 1974 (ERISA) which requires private employers to have written plans documenting benefits they provide, who is eligible, and how plans can be terminated
Pension Benefit Guaranty Corporation — not-for-profit organization created by federal government that insures defined benefit plans
Vesting — time required before employees own part or all of their retirement funds
Contributory plan — employer and employee both put money into retirement account
Noncontributory plan — employer puts funds into employee’s account
Defined benefit pension plan — provides annuity to eligible employees upon retirement
Defined contribution plans — amount of retirement income is based on how well the employee invested the money
401(k) plans — employees contribute to plan in pretax dollars and funds accumulate tax free until person retires
Cash balance plans — define the benefit a person receives upon retirement in terms of cash payout. “Credits” are based on a percentage of employee’s compensation
Pension Protection Act of 2006 — tightened rules on funding, administering, and terminating pension funds |
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Term
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Definition
Many companies are eliminating or limiting health benefits for retirees
Firms are doing a better job of communicating and educating their employees about benefits
Flexible benefit plans (cafeteria plans) —allow employees to choose which benefits they want from a menu based on a set amount of money or credits each employee receives |
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Term
| OSHA (Occupational Safety and Health Act) |
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Definition
OSHA covers private-sector employers with its mission to “send every worker home whole and healthy every day”
Enforces safety and health regulations and provides education and compliance assistance
Has right to inspect businesses, issue citations and fines
Employers are responsible for following standards, notifying employees about them and handling complaints |
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Term
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Definition
Inspect imminently dangerous situations, fatalities and catastrophes, complaints, and high-hazard industries, in that order
Recognize employers who are committed to safe and healthy workplaces
Voluntary Protection Programs focus on establishing a relationship between OSHA and companies that have comprehensive safety and health programs |
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Term
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Definition
Homicide is fourth-leading cause of fatal occupational injuries
Leading causes—contact with public, delivery of passengers, services, goods, working alone or in small groups, exchanging money, working with unstable/volatile persons |
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Term
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Definition
Designing workplace for safe and efficient completion of tasks
Includes height of chairs, visual distance from computer, lifting heavy objects
Guidelines developed for industry and task-specific activities |
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Term
| Strategy and Total Compensation Package |
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Definition
Firms with low-cost strategy will minimize the amount spent on non-direct compensation
Firms with differentiation strategy offer higher levels of benefits
Smaller companies may offer more flexibility in benefits package
Government employees receive the highest level of benefits followed by employees working in education and large nonprofit sector |
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Term
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Definition
Younger workers will have different benefit expectations like education and child-care
Older workers may be interested in long-term care insurance and retirement
Wellness programs and education may improve strength and flexibility of workers to prevent injuries |
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Term
| Axioms for Effectively Managing Employees |
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Definition
No two companies are the same
There is no one best way to manage employees
Using the wrong practice, or using the right practice poorly, can cause more harm than good |
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Term
| High Performing HR Systems |
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Definition
External alignment —managers select HR activities that help company meet its organizational demands, cope with environmental factors and comply with regulatory issues
Internal alignment —focuses on how well a firm’s employee management practices support one another |
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Term
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Definition
Company’s strategy influences:
How jobs are designed
Workforce planning tactics
Recruitment and selection practices
Types of training and development
Performance evaluation methods
Decisions concerning compensation and benefits
Safety and wellness plans |
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Term
| Internal Fit of HR Practices |
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Definition
Each decision influences other choices companies make about managing employees
Synergies occur when combined with other HR practices
Powerful connections occur when practices support and reinforce each other |
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Term
| Aligning HR Systems with Employees’ Contributions |
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Definition
Gives the firm a competitive advantage
Companies need to understand how their employees add value |
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Term
| Managing Employment Portfolio |
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Definition
HR systems may target a variety of employee contributions like:
Customer service
Productivity
Creativity
Quality
Safety |
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Term
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Definition
Employees contribute different things to their firms
As the strategic value of an employee’s contributions decreases, the potential return from his/her contributions diminishes
This is often when employers turn to external sources (outsourcing) |
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Term
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Definition
The extent to which contributions employees make are specialized or unique to a company and not readily available in the open market
Employers are more willing to invest in employees to realize those contributions
Transactional relationships — economic relationships that focus on both parties meeting the terms of the agreement they have with each other
Relational relationships — Involve much greater commitment to the individual by the company and vice versa |
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Term
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Definition
Strategic value of certain positions influences the following types of HR systems:
Commitment-based
Productivity-based
Compliance-based
Collaborative-based |
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Term
| Core Employees (High Uniqueness – High Strategic Value) |
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Definition
Most likely to contribute directly to a firm’s core competencies based on their knowledge
Companies use a commitment-based HR system to manage these employees and invest in them for their long-term success
Firms may invest extensively in developing their competencies and empower them |
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Term
| Job-Based Employees (Low Uniqueness – High Strategic Value |
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Definition
Do not contribute in a unique manner and are likely to be from the external labor market
Companies use a productivity–based HR system that involves standardized jobs and select people who can immediately contribute in these jobs
Focus is on efficiency and productivity improvements |
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Term
| Contract Workers (Low Uniqueness – Low Strategic Value) |
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Definition
External workers who perform tasks that are neither strategically valuable nor unique
Companies use a compliance-based HR system that consists of preset rules, regulations, and/or procedures. The focus is on short-term productivity and efficiency.
Compensation of these workers are likely to be hourly wages |
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Term
| Alliance Partners (High Uniqueness – Low Strategic Value) |
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Definition
Individuals who make unique contributions of limited value in terms of strategic impact
Companies use a collaborative-based HR system and turn to external labor on a long-term basis
Example of this type of employee is a consultant |
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Term
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Definition
Offers a way to evaluate your HR systems
To create an HR scorecard you need to:
Identify your firm’s strategic performance drivers
Evaluate your firm’s external alignment
Evaluate your firm’s internal alignment |
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Term
| Identify Strategic Performance Drivers |
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Definition
Activities that enable a company to realize its source of competitive advantage
Low-cost leadership
Operational excellence
Increased productivity
Translate a firm’s strategic objectives into actionable activities—strategic performance drivers |
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Term
| Evaluate Firm's External Alignment |
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Definition
Align primary HR activities with the source of firm’s competitive advantage
Translate strategic performance drivers into HR deliverables (how HR systems create value for a company) |
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Term
| Evaluate Firm's Internal Alignment |
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Definition
Determine whether practices used for primary HR activities are helping or hurting the achievement of firm’s HR deliverables
When misalignments occur, managers can look for ways to improve company's HR deliverables |
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Term
| Building a High Performing Organization |
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Definition
Continually assess the ability of your HR system to meet company’s changing needs
Reassess and redesign the practices used to manage employees
Customize an HR scorecard to be consistent, specific, and provide follow up
Identify the source of company’s competitive advantage |
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Term
| High Performing Organization (Continued) |
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Definition
Determine which HR deliverables are necessary to achieve strategic performance drivers
Ensure all practices reinforce rather than counteract each other
Employees need a clear understanding of what they need to do to help their company succeed
Follow up will dramatically increase success |
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