Compensation Plan
A compensation plan is a package that consists of the wages, salaries and benefits of the employees. There are different types of compensation plans, and each of them has their advantages and disadvantages.one of the most connected method to my current workplace is the straight salary compensation that has got the characteristic of basic salaries and wages given to the employed. Straight salary promotes the equality sense among the staff who work as a team or individually. The main benefit of a straight salary is that it is of more help to one who is transferring to another organization (Mistry, 2017). The salary plus commission plan is a better and reliable one as enables an individual to have the necessary salary alongside the bonus if his or her performance exceeds or is on point with the goals. This gives more morale for one to work more to reach the goals.
The six main building blocks have several steps that lead to designing and implementing an effective plan. Among the measures, the designing of the compensation structure is what I think is valuable to the HRM compensation strategic planning. By the use of the outcomes when jobs are evaluated and benchmarked, the ranges on salary are made, and slotting of positions is done within the fields (Walters, 2004).
When we discussed the various compensation plans and the importance of these compensation plans, some argued on the commission only compensation and termed as a bad one (Bryant & Allen, 2013). How do you work at a specific period only to receive the lowest commission in terms of salary? Although it makes on to step up honestly, it also needs to give hope to the employees. At least half the basic wage plus the commission is better and more motivating.
References
Bryant, P. C., & Allen, D. G. (2013). Compensation, benefits and employee turnover: HR strategies for retaining top talent. Compensation & Benefits Review, 45(3), 171-175.
Coker, D. (2015). The Importance of Compensation Plan in an Organization (Links to an external site.)
Mistry, P. (2017). 6 DIFFERENT TYPES OF COMPENSATION PLANS & BENEFITS (Links to an external site.)
Walters, C. (2004) Compensation 101: Building a strategy that supports small-business success (Links to an external site.)