introduction to compensation management - compensation management - manu melwin joy
TRANSCRIPT
Introduction to compensation managementCompensation Management
Prepared By
Kindly restrict the use of slides for personal purpose. Please seek permission to reproduce the same in public forms and presentations.
Manu Melwin JoyAssistant Professor
Ilahia School of Management Studies
Kerala, India.Phone – 9744551114
Mail – [email protected]
Introduction to compensation management
• Different kinds of rewards.
• Intrinsic rewards
• Extrinsic rewards.
– Direct compensation.
– Indirect compensation.
– Non financial Compensation.
Intrinsic rewards
• Participative decision making.
• More responsibility.
• Opportunities for personal
growth.
• Greater job freedom and
discretion.
• Diversity of activities.
Extrinsic rewards – Direct Compensation
• Basic Salary or Wage.
• Overtime and holiday
premiums.
• Performance bonus.
• Profit sharing.
• Stock options.
Extrinsic rewards – Indirect Compensation
• Protection programmes.
• Payment for time not
worked.
• Services and perquisites.
Extrinsic rewards – Non financial Compensation
• Preferred office furnishings.
• Assigned parking spaces.
• Impressive designation.
• Preferred lunch hours.
• Preferred work assignments.
• Own secretary.
Purpose of reward systems
• Svensson summarizes the
purpose of reward systems
in the following seven
points.– Stimulate to increase effectiveness.
– Stimulate to improve quality.
– Give increased responsibility and
influence over the individuals own work
situations.
Purpose of reward systems
• Svensson summarizes the
purpose of reward systems in
the following seven points.– Stimulate personnel movement
internally and externally.
– Stimulate competence development.
– Stimulate new work forms.
– Support flexible management and work
forms.
Slope of compensation management
• Every person has a different
definition of compensation
depending on the life
experiences of that person. To
a watchman working in an
organization, the word
compensation is likely to mean
money.
Slope of compensation management
• To a manager or executive
concerned about paying for his
children’s college education and
saving for retirement,
compensation will mean money as
well as the organization's stock
options, performance bonus,
ownership stake, recognition,
career growth and many more.
Slope of compensation management
• To a social worker, it could
be the sense of satisfaction
one gets by serving the
disadvantaged people rather
than money, stock options or
performance bonus that is
more meaningful.
Slope of compensation management
• Thus compensation means not
just money but benefits like
employee development, even
though not necessarily viewed
by the employee as
compensation, is a substitute
for money and a major cost for
organizations.
Slope of compensation management
