Compensation Strategies for Different Workforce Generations

Employees are the most valuable assets of any organization. The main purpose of human resource management (HRM) is to manage the development and performance of people employed in an organization. Some of the important tasks of HRM include attracting and retaining employees with the right skills and abilities, match people to the right positions within an organization and to align employee’s goals and objectives with that of the organizations. All these key tasks are directly or indirectly affected by compensation and benefits plan which the human resource management decides. Compensation and benefits redefines value and success in any workplace. An efficient compensation and benefits strategy is seen as an opportunity by organisations to differentiate them-self from their competitors, who may otherwise take away talented workforce. Hence, organisations need to know the evolving needs of the working population to make sure they offer the most competitive package. Compensation is a majorContinue reading

Equity and Fairness of Employee Compensation Systems

Compensation is key to organisational strategy. It has an impact on attracting and retaining employees and ensuring optimal performance in meeting the organisation’s objectives. The economic importance of compensation is that it should allow the organization to maintain a cost structure that enables it to compete effectively and efficiently in its markets. Adams equity theory suggests that once an individual has chosen an action that is expected to satisfy his or her needs, the individual assesses the equity or fairness of the outcome. Three attitudes are possible; an individual may feel equitably rewarded, under rewarded, or over rewarded. When individuals feel under rewarded or over rewarded, they will do something to reduce the inequity. A further development ‘Fairness theory’ takes into account the notion of accountability and blame. When people identify an instance of unfair treatment, they are holding someone accountable for an action that threatens another person’s material orContinue reading

Necessity for Alignment between Corporate Strategy and HR Strategy

Current business environmental forces such as competition, innovation, globalization, technological advancement etc has created major impact on organizational behavior. These changes come in different forms. Sometimes it required to reorganize the structure of the organization and due to this organization may have to introduce new roles and new people. Sometimes it may require to change the culture of the organization. In all these situations HRM function plays a major role. Further recent development of new concepts such as knowledge workers has increased the complexity of HRM function. Nowadays HR has become strategic assets for organizations. From an IT company’s view point intellectual property that is knowledge of the software developers is crucial for their business than the physical asset of the company. This importance has heightened due to the transition of old economic conditions to knowledge based economy where it considers the intellectual property as one of key success factorsContinue reading

Career Development – Meaning, Definition and Stages

The concept of career development is of growing concern to organizations since it matches the needs of a business with the career goals of employees. Formulating a career development plan can help employees to do their jobs more efficiently. Additionally, these plans can be beneficial for employees who might want to move up in a company or look for other jobs in the future. Today, challenging organizations have developed new concerns for the career development of their employees. They put greater emphasis on ‘career’ with coherent induction, training and development, increased job security by the accrual of experience and qualifications valued in the labor market. Since a high majority of workers change their careers at midlife, it becomes evident that career development programs are needed throughout the life cycle. Other major reasons for this concern are: The growth and productivity of organizations depend on the effectiveness of employee performance. AContinue reading

Wage Differentials – Types and Implications

If we take various contingent factors into account, we find that there may be differences in wage and salary structures. These differentials may be industrial and occupational, regional, organisational and personal. Industrial and Occupational Differentials : Industrial and occupational differentials exist because of requirement of different skill set and imbalance in demand and supply of personnel having such skills. Wages and salaries are usually fixed on the basis of skills required to perform a job. Thus, highly specialized jobs requiring higher level of skills are linked with higher pay too. Coupled with this, shortage of supply of such personnel also induces the payment of higher pay. Regional Differentials : Apart from industrial arid occupational differentials, there may be differences in wages and salaries region-wise also within the same industry and occupation group. Such differences are visible in different countries of the world as well as different regions within a country.Continue reading

Topics for Employee Training Programs

Training can be defined as the process of “Transferring information and knowledge to employers and equipping employers to translate that information and knowledge into practice with a view to enhancing organization effectiveness and productivity, and the quality of the management of people.” It also means that in organizational development, the related field of training and development deals with the design and delivery of workplace learning to improve performance. The common topics for employee training and development programs are; Corporate ethics: This covers the value of good manners, courtesy, consideration, personal decor and good rapport. It also shows why and how to discourage gossip, controversies, personal work at office, rush jobs etc. Communications: The increasing diversity of today’s workforce brings a wide variety of languages and customs. Right from the way the receptionist handles a call to how the CEO deals with a customer gives a glimpse of the imageContinue reading