Problem: Research Wal-Mart. Discuss the compensation philosophies and approaches that have been used at Wal-mart. Discuss the nature of the product or service provided. Answer the following questions related to that system:
- Were they market based, or internal equity based?
- Were they competency-based to help you grow and develop? Based on the use of some formal job evaluation system?
- Was there a team performance component included?
- How were base salaries typically set?
- Was it a performance based system? Based on seniority? Based on across the board increases for everyone? Based on cost-of-living increases only? Based on lump-sum approaches or a bonus?
- Did it include a variable pay component (incentive system)? A piece rate system? A profit sharing a stock ownership component?
- Were supervisor ratings used or peer and/or self-appraisals? Were 360-degree approaches used? Or was the system based on a combination of some of these factors?
- How were executives paid? Were their total packages based on salaries, bonuses, long-term performance-based incentives, or other benefits and perks such as a "Golden Parachute")?
- Finally, what were the consequences of these philosophies and approaches? Do you think they helped the organization complete its strategic objectives or not.