Assignment:
Compensation Purpose and Strategy Document
The purpose of assignment is to choose a compensation philosophy that is appropriate for your chosen firm and articulate a rationale for this selection.
Chosen firm is my fictional bakery be sure to use current sources under 10 years old. A word of caution: Build the compensation package for an organization, either real or fictional
There are two aspects to assignment. First, describe the risks and benefits with leading, meeting, and lagging the market in overall compensation and benefits. Next, choose the appropriate strategy (lead, meet, or lag) for your firm, and provide rationale about why this is appropriate.
Create a 500 words for the compensation purpose and strategy document.
Consider some of the following factors in your assignment:
1. Payroll expenses are usually the highest expense at most firms. If you lead the market, this expense can be taxing.
2. If you are pursuing top talent in human capital rich industries (e.g., software engineering), lagging the market may keep you from competing for market share against your competitors.
3. If you meet the market, paying average will generally not attract top talent, and in addition, you will not have the labor-cost savings of a lag-the-market strategy.