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Introduction
The modern approach in the companys management involves using innovative and intelligent instruments. It is imperative to consider such actions in the context of planned changes in the organizations structure. This essay will discuss EasySpa and its plans to expand its workforce to become a key regional player. The paper aims to review the specifics of the compensation manager position, various concepts, and benefits for the company to create recommendations for the director of Human Resources of EasySpa. The complex analysis of the company and the advantages of the compensation manager position will allow for rationally distributing compensations and effectively implementing changes inside the company.
Definition, Advantages, and Peculiarities of the Compensation Management
Considering the case of Jay Spento, who works as the director of Human Resources in EasySpa, in the context of his desire to convince the companys CEO to hire a compensation manager, it will be essential to consider the benefits of this position consistently. In addition, an important task will be to identify the central liabilities and possible benefits for the EasySpa company. In the book UGC NET Human Resource Management, the author discusses compensation management. According to EduGorilla (2022), it uses financial and nonmonetary benefits to attract recruits, reduce turnover, spur performance, and boost employee engagement (p. 132). This versatile number of advantages the company receives needs to be studied in detail in the context of the activities of the compensation manager specialist and to consider multiple concepts necessary for understanding the benefits of hiring this manager.
Strategic Compensation, Bases for pay, and Designing Compensation Systems
Strategic compensation is a vital project of the manager. It involves close cooperation with such specialists as the lead HR executive and the chief financial officer (Martocchio, 2019). The main goal of this strategy is to create an effective and balanced system to encourage employees to do their work efficiently (Martocchio, 2019). The next concept is based on pay, consisting of three aspects, traditional, incentives, and person-focused pay (Martocchio, 2019). The traditional type refers to compensation for the employee by their leading states, such as job title, position, or seniority (DeVaro, 2020). Incentives form is based on employee productivity (DeVaro, 2020). Finally, person-focused pay rewards certain employees for their unique contribution to the companys development (Martocchio, 2019). For example, this kind of compensation can occur based on the specialized skills of the employee. In addition, it is essential to consider the following concept of compensation management, designing compensation systems. The primary purposes of it, as Martocchio (2019) states, are building internally consistent job structures, establishing market-competitive pay rates, and creating pay structures that recognize employee contributions (p. 129). This concept lays the foundation for the implementation of companys compensation strategy.
Employee Benefits, Contemporary Strategic Compensation Challenges, and Compensation Issues Around the World
There are two types of employee benefits. First, discretionary benefits, which describe offerings to the employee at the will of company management (Martocchio, 2019). Second, legally required benefits are divided into an employers discretion in a pay mix (Martocchio, 2019). The next concept is contemporary strategic compensation challenges representing executives and a flexible workforce (Das et al., 2021). These two principles differ in understanding different employee benefits regarding different employee groups (Martocchio, 2019). In addition, the next concept is called compensation issues worldwide and discovers principles and practices of expatriate compensation according to the experience of different countries. The concept considers the peculiarities of employee benefits in the context of processes such as the globalization of the economy and other important factors affecting decision-making (Martocchio, 2019). The last concept depicts challenges that compensation managers can face. Among them is the gender pay gap, pay transparency, performance appraisal trends, and more (Martocchio, 2019). All the concepts mentioned above are crucial in the understanding of the working process of the compensation manager and will be vital for the creation of the recommendation for the EasySpa company.
Recommendations for the EasySpa and Jay Spento
Taking into account the abovementioned advantages of the position of compensation manager for the company, as well as the characteristic concepts describing the features of his work, it became possible to make a recommendation to Jay Spento. First, as an HR manager, Jay needs to explain to his CEO that the work of the compensation manager is a complex analysis of a significant number of aspects of the companys functioning. The number of factors that compensation manager uses during their work are competitive analysis, cost of living, labor negotiations, personal qualifications, and supply and demand (EduGorilla, 2022). Therefore, EasySpa will be able to create a rational development strategy with compensations based on increasing the number of its employees. Second, this position will allow EasySpa to significantly increase employee motivation (Putra et al., 2020). Therefore, improving all significant company indicators, including income, thankfully to more motivated work of employees. Third, establishing market-competitive pay and using competitive analysis and compensation manager to make EasySpa competitive and provide the company with specific advantages. All the above-mentioned factors will play a vital role in the companys expansion and ensure its stability in the future.
Conclusion
In conclusion, it is essential to emphasize that the company can effectively manage its financial resources with compensation management. The advantages of a compensation manager position will allow for finding a balance between different kinds of compensation for the employee. Various aspects and concepts discussed in the essay, such as strategic compensation, employee benefits, and compensation issues worldwide, emphasize a comprehensive approach to analyzing nuances and possible dangers. Thankfully to the work of the compensation manager, the company will be safe during its expansion, as in the case of EasySpa.
References
Das, P. K., Chhetri, M., & Tamang, R. (2021). Compensation management. Ashok Yakkaldevi.
DeVaro, J. (2020). Strategic compensation and talent management: Lessons for managers. Cambridge University Press.
EduGorilla Prep Experts. (2022). UGC NET human resource management paper II chapter wise note book | Complete preparation guide. EduGorilla.
Martocchio, J. J. (2019). Strategic compensation: A human resource management approach [10th Ed.].
Putra, M. R., Yandi, A., & Maharani, A. (2020). Determination of employee motivation and performance: Working environment, organizational culture, and compensation. Dinasti International Journal of Education Management and Social Science, 1(3), pp. 419-436, Web.
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