take off program

Take Off Program

Dr. Guido Gianasso Vice President, Human Capital

Take Off Program April 2012

Rewards

Compensation: Is it important to motivate and retain employees?


Factors affecting job attitudes as reported in 12 investigations

Series1

Factors characterizing 1,844 events on the job led to extreme dissatisfactions

Factors characterizing 1,753 events on the job that led to extreme satisfaction

Series1

growth

Advancement

Responsibility

Work itselfRecognition

Achievement

Security

Status

Relationship with Subordinates

Personal life

Relationship with peers

Salary

Work conditions

Relationship with supervisor

Supervision

Company policy and administration

-10-20-30-40 0 10 20 30 40 50

Motivation versus hygiene factors

Motivation factorsFactors related to the unique human characteristic to achieved and, through achievement, to experiencepsychological growth

Hygiene factorsFactors related to the built – in drives conditioned to the basic biological needs (hunger->money->drive)

Stimuli for the growth needs are the job content

Stimuli inducing pain – avoidance behavior are in the job environment

Extrinsic to the jobCompany administration, supervision, remuneration, work / life balance

Intrinsic to the jobAchievement, work itself, responsibility, growth

Needs

Stimuli

Factors which motivate and retain employees

Work itselfRecognition and promotion

opportunitiesPersonal growth and learning

April 2012Take Off Program

Compensation and Administration

“Hygiene” factorsIf not properly managed – strong

demotivational factorsThey do not in themselves ensure

motivation and commitment


Remuneration – a hygiene factor

Herzberg, Schein If the employee is paid below market

average, he/she will be demotivated

But A good remuneration is not in itself sufficient

to motivate the employee


If you were the CEO,what factors would you consider in designing a compensation system?


Five Objectives Of ARemuneration System

Strengthening corporate culture and supporting

strategic objectives

Competitiveness on local labor

marketCost control

(income / cost ratio)

Internal equity Employee motivation

Evolution of Compensation Systems


Evolution in Compensation Systems

Salary scales to broad bands

Salary increases based on seniority to merit-based increases

Pay for performance - incentive


http://icsc.un.org

WORLD BANK GROUP NET SALARY STRUCTUREEffective May 1, 1996

Grade Minimum Midpoint Maximum

29 146,520 161,190 175,860

28 127,950 143,920 159,890

27 115,280 129,670 144,060

26 96,190 117,880 139,570

25 84,190 105,240 126,290

24 72,360 93,970 115,580

23 64,600 83,890 103,180

22 59,920 74,900 89,680

21 53,510 66,890 80,270

20 47,780 59,720 71,660

19 42,650 53,310 63,970

18 38,090 47,610 57,130

17 32,730 42,500 52,270

16 29,210 37,930 46,650

15 26,100 33,900 41,700

14 23,290 30,250 37,210

13 20,790 27,000 33,210

12 19,290 24,110 28,930

11 17,220 21,530 25,840

2000 Salary ScaleCanada

Effective from January 1, 2000Annual Salaries in CAD

Grade Minimum Midpoint Maximum

1 21,800 25,640 30,770 2 24,880 29,260 35,120 3 28,380 33,380 40,060 4 32,400 38,110 45,740 5 36,980 43,500 52,200 6 43,160 50,770 60,930 7 54,560 64,180 77,020 8 63,720 74,960 89,960 9 70,050 87,560 109,450

10 81,810 102,260 127,830 11 95,560 119,440 149,300 12 111,610 139,510 174,390 13 130,360 162,950 203,690

IATA Salary Bands

A Support StaffEntry to Advance

B Support supervisorsHighly Skilled Tech support

C ManagersSpecialists – Level 1

D Assistant DirectorsSpecialists – Level 2

E Directors

F ExCom Members

IATA Compensation Strategy


Drivers: IATA Compensation StrategyBased on Merit/Performance

Geared to Market conditions

FavorsLower-paid Employees

Applying the Compensation StrategyBased on Merit/Performance

Rating on Performance Assessment


Classification ofCountry Category

FavorsLower-paid Employees

Position onSalary Band

IATA offices in 60 Countries

Category A – high inflation/currency devaluation

Category B – salary structure not in line with local market

Category C – salary structure adequate Category D – salary structure adequate,

legal/contractual cost of living adjustments


2012 “A” countries

Across-the-board increase Effective 1 Jan 2012 Based on a combination:

Actual inflation rate from IMFForecast inflation rate from IMFForecast market salary increases from

specialist international compensation consulting firm


Applying the Compensation StrategyBased on Merit/Performance

Rating on Performance Assessment


Classification ofCountry Category

FavoursLower-paid Employees

Position onSalary Band

22

Performance-based salary increases

Line supervisors will be able to grant salary increases within the following ranges and pre-determined budget at regional and divisional level:

Country Category

A B+ B C

A 3%-9% 0%-6% 0%-4% 0%

B 3%-9% 0%-6% 0%-4% 0%

C 3%-9% 0%-6% 0%-4% 0%

D 1%-7% 0%-4% 0%-3% 0%

Performance Appraisal Rating

23

Extraordinary Performance BonusesRecognizing individuals with unique contributions 5% to 10% of annual base salary within pre-determined budgetApplicable only for individuals not covered by other programs

Sales Incentive program for field salesVariable Compensation program for Country Managers

Other Bonus Programs

Variable Compensation ProgramDirectorsCountry Managers

Sales Incentive PlanSales Team


25

For promotionsConfirmed throughout the year Salary changes will be effective at date of promotion

For other adjustments (such as rebanding of positions, salary realignments)Confirmed once per year (1 April)Salary changes will be effective on that date

Promotions and adjustments

Employee Recognition Programs Individual and team awards for special

achievement Four levels

PlatinumGold Silver Bronze

More information and nomination forms on Intranet


Rewards


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