Compensation Plan
Brief Overview of Costco's Compensation System

Costco has a unique compensation system within its industry. The company competes as a cost leader, where it features low prices as a means of winning business. Cost leaders typically try to have rock bottom costs throughout their operations, from the supply chain to labor and everywhere in between. These competitors will use their bargaining power to get the cheapest labor possible, bargaining down wages, benefits and other perks. This often results in a poor quality labor pool with high levels of turnover, but these companies accept that as part of having a low cost labor pool and account for that is the design of the low cost business model (Lutz, 2013).

The approach that the company has to compensation is therefore counterintuitive to the way that most of its competitors run their human resources, but there is internal logic to Costco's system. Costco is…...

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References

Costco. (2014). Benefits. Costco. Retrieved May 31, 2014 from https://costcobenefits.com/cms/your-wealth/401k/index.shtml

Deci, E., Ryan, R. & Koestner, R. (1999). A meta-analytic review of experiments examining the effects of extrinsic rewards on intrinsic motivation. Psychological Bulletin. Vol. 125 (6) 627-668.

Goldberg, A. & Ritter, B. (2005). Costco CEO finds pro-worker means profitability. ABC News. Retrieved May 31, 2014 from http://www.sba.pdx.edu/faculty/susanm/semaccess/BA%20385/Costco%20CEO%20Finds%20Pro-Worker%20Means%20Profitability.doc

Gray, C. (2014). Tangible benefits of reducing turnover. Houston Chronicle. Retrieved May 31, 2014 from  http://smallbusiness.chron.com/tangible-benefits-reducing-turnover-21668.html

Compensation Plan Outline
Ford Motor Company is the largest manufacturer of heavy commercial vehicles and second largest producer of automobiles in the world. Their range of vehicles comprises 70 different types that include Jaguar, Lincoln, Volvo, Mercury, Aston Martin, and Ford with presence in over 30 countries worldwide. Ford employs over 300,000 employees across the globe. In the United States itself, Ford has an employee strength nearing 100,000 employees and sales exceeding three million units (Joesph, 2003).

Compensation Plan of Ford Motor Company

Association with Ford Motor Company is a fulfilling experience for the workforce. The company offers motivation for exemplary work ethics, opportunities for individual and collective growth that translates into challenges to be met and overcome. The vast range of vehicles produced in the company provides the stimulus for development of the personnel at all levels, as does the cultural and regional diversity of the workforce itself. Ford takes pride in…...

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References

Daniels Fund Ethics Initiative (2014).Ford Motor Company Manages Ethics and Social Responsibility. Retrieved from http://danielsethics.mgt.unm.edu/pdf/ford-motor-case.pdf

Ford Motor Company (2014). Notice of 2014 Annual Meeting of Shareholders and Proxy Statement. Retrieved fromhttp://corporate.ford.com/doc/457/143/ir_2014_proxy.pdf

Ford Motor Company (2011). Summary of Compensation and Benefits for Ford Motor Company. Retrieved from http://corporate.ford.com/doc/r-full-time-benefits.pdf

Joseph, B.S. (2003). Corporate ergonomics program at Ford Motor Company, Applied Ergonomics, 34, 23-28. Retrieved from  http://www.sciencedirect.com/science/article/pii/S0003687002000807

organization's ability to recruit and retain talented employees requires ensuring employees are rewarded proportionately for their contribution towards achieving organizational goals and profitability. To achieve this, a benefits and compensation policy is developed and implemented for all workers. This company has established a compensation policy that offers a full range of conventional benefits, dental, vision and medical benefits in addition to a rewards program that offers incentives based on employees' input. However, there are numerous complaints from the workforce that these benefits do not effectively address a growing problem. To address this growing problem, it's important to develop a Benefits and Compensation plan that offer packages that correspond to the employee type, reflects the organization's culture, and is comparable to the company's competitors.
Components of the Benefits and Compensation Plan

The current benefits and compensation plan is seemingly ineffective because it does not provides benefits and compensation based on the employees'…...

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References

Dunne, P.M., Lusch, R.F. & Carver, J.R. (2014). Retailing (8th ed.). Mason, OH: Cengage Learning.

Linton, I. (n.d.). Basic Responsibilities for Retail Workers. Retrieved October 14, 2016, from  http://smallbusiness.chron.com/basic-responsibilities-retail-workers-36997.html 

White, M.C. (2014, April 27). The Many Ways Retailers Pay and Reward Employees. Retrieved October 14, 2016, from  http://www.jckonline.com/2016/02/19/many-ways-retailers-pay-and-reward-employees

The sales person is driven by their target, as to fail to meet the target would not only be financially costly but embarrassing. The second target, the hard-to-achieve target -- is something that the salesperson can take pride in achieving. Attaining this target means more for the success and improvement it represents than for the payout that comes along with it.
The third component is the Top Performer incentive. For some sales staff, this may not serve as significant motivation as they may not feel as though they are in contention. For those high-performing staff members, however, this award gives the opportunity for bragging rights -- fulfillment of the ego. This can be powerful motivator for sales people. This incentive will work for the strong sales people, so while the others may not push themselves to attain it, all of the best sales people will and in doing so they…...

Interclean
New compensation plan for the employment team

As a result of the changes which have recently been implemented within InterClean, a new need arises in the necessity to align the compensation plan with the new organizational features. In other words, the changes implemented would only succeed if they are adequately supported by the staff members and a means of attaining employee support in times of organizational change is that of readdressing compensation issues (Lamm, Gordon and Purser, 2010).

Given this situation, the current endeavor proposes a new compensation plan based on the following:

A guaranteed minimum wage established for all of the team members

Additional wage increases based on specific employee features, such as experience, loyalty to the firm or level of education acquired

Premiums and bonuses based on performance

Non-financial compensations, such as flexible working schedules or the offering of training programs.

The above presented pay system stands increased chances of supporting organizational goals due to…...

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References:

Carlson, D.S., Bozeman, D.P., Kacmar, K.M., Wright, P.M., Mcmahan, G.C., 2000, Training motivation in organizations: an analysis of individual-level antecedents, Journal of Managerial Issues, Vol. 12, No. 3

Lamm, E., Gordon, J.R., Purser, R.E., 2010, The role of value congruence in organizational change, Vol. 28, No. 2

Mellor, E.F., 2002, Shift work and flexitime: how prevalent are they? Monthly Labor Review, Vol. 109

managerial decisions: Structuring compensation plans
Economics / Chapter 14

Firms attempt to create attractive compensation plans in order to retain as well as motivate qualified employees. These compensation plans will vary among firms due to factors such as the nature of the product, competition, and location. In this particular case, Kaufmann's is a large chain department store which carries a broad range of products with a target of middle income consumers. With the knowledge that middle income consumers tend to spend more of their money on goods and services, this would tend to mean that there is the possibility for them to sell more goods than Parkleigh Pharmacy, as Parkleigh Pharmacy sells very expensive products. Taking this into consideration, Kauffmann's offering a five percent commission on sales will motivate the sales person to increase sales. This will in turn benefit Kaufmann's, as it would increase its sales revenue. On the other…...

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References

Fischer, S. (Ed.). (1986). National Bureau of Economic Research Macroeconomics

Annual (Vol.1). Massachusetts: MIT Press.

Polachek S., & Siebert, W.S. (1993). The Economics of Earnings. Massachusetts:

H SBUX
The company I have chosen is Starbucks. The two positions within the company are barista and assistant store manager. The compensation plans for these two positions will be compared.

There are many similarities between these two plans, based on the way that Starbucks has designed all of its compensation plans. However, there are some differences. One of the biggest differences is that the barista position is typically an hourly position, based on part-time work usually. The company's compensation plan is designed around the principle of base pay for all positions, with some positions being eligible for bonuses. The latter are typically the salaried positions of which assistant store manager is one. The barista has an incentive to perform because performance creates opportunities at higher levels of the organization, and move upwards from an hourly position. Managerial roles within the company are eligible for performance-based bonuses, as there are a number…...

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References

Kappel, M. (2012). What is internal equity? Patriot Software. Retrieved June 7, 2014 from  http://www.patriotsoftware.com/small-business/blog/what-is-internal-equity/ 

Starbucks (2014). Your special blend. Starbucks. Retrieved June 7, 2014 from  http://globalassets.starbucks.com/assets/13aefdbe8b2c4da8856116c1fd5fe54c.pdf

Compensation Components Offered at a Foreign Work Site
The compensation components offered to an employee of a U.S. company with the opportunity to take a job at a foreign work site availed through some form of an insurance plan. An important set of components is always non-insurance based and provides income to the employees at a foreign work site. These benefits can be classified into three major segments:

Loss of job income continuation

Disability income continuation

Accident and health protection

Liability and property protection

A special set of services and benefits known as prerequisites (Henderson, 2006).

All the categories contain various compensation components with various features given to an employee of a U.S. company with the opportunity of working at a foreign work site.

Disability income continuation

Disability can be categorized as temporary, singular, partial, or total. When the employee is unable to work because of some health related problem or an accident, disability income and continuation payment helps…...

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References

Henderson, R.I. (2006). Compensation management in a knowledge-based world (10th ed.). Upper Saddle River, NJ: Prentice Hall.

Goel, D. (2008). Performance appraisal and compensation management: A modern approach. New Dehli: Prentice-Hall of India.

In the past, Payless was hesitant to determine salary increases on individual performance, because of the possibility of demoralizing employees. However, the company decided to follow other companies, because it helps retain top performers and provides more a greater degree of accountability in the corporate culture (Marquez, 2006).
s a result, at Payless, the average salary increase for high performers jumped from 9.5% in 2004 to 9.9% in 2005, while the average merit increase only rose 0.2% over the same period. Payless' new program requires its 12 business unit leaders to create a "nine box," with each box detailing an employee profile, how the manager should address the employee's performance and growth potential and what the range of the salary should be. One box may have the name of an employee who is out the door for not performing well enough and another box may have a top performer who…...

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As a result, at Payless, the average salary increase for high performers jumped from 9.5% in 2004 to 9.9% in 2005, while the average merit increase only rose 0.2% over the same period. Payless' new program requires its 12 business unit leaders to create a "nine box," with each box detailing an employee profile, how the manager should address the employee's performance and growth potential and what the range of the salary should be. One box may have the name of an employee who is out the door for not performing well enough and another box may have a top performer who is getting a huge increase (Marquez, 2006). Both of these companies say it is too early yet to know if this change in compensation approach will be a positive or negative.

There have always been certain professions that felt more comfortable or expected working this way, such as salespeople. Sales compensation can be distinguished from other employee pay programs because salespeople have a direct and measurable impact on the company's revenue. This impact creates the opportunity to directly hinge a salesperson's individual performance as it relates to developing a positive impact on the business by: 1) Supporting the company's marketing and selling plans;

2) Communicating performance expectations; 3) Influencing the efforts and behaviors of employees engaged in the selling process by rewarding based on performance outcomes, and 4) Contributing to the

Q12. Describe the impact of legislation on the field of compensation management.

Minimum wage and overtime laws restrict the minimum amount employers can offer to workers; anti-discrimination legislation mandates that employees are compensated without regards to their racial, ethnic, gender, or disabled status.

Q13. Identify the impact of incentives such as bonuses to a compensation program.

For some professions, such as sales and investment banking, bonuses derive the bulk of the individual's expected salary. Bonuses can also be a means of distinguishing social status between employees. Bonuses can also simply be used to encourage higher levels of performance, based upon short-term outcomes.

Q14. Explain how the global market affects U.S.-based companies' compensation.

In a global marketplace, high-quality employees are more 'portable,' but because of the ability to outsource labor, employees may also find their salaries kept artificially low through the availability of lower-cost foreign workers.

Q15. Describe salary/market surveys.

Salary market surveys, much like a market survey…...

Compensation Improvement Company ABC
The goal of this review will be to examine the overall objectives of the pay model for ABC corporation, a small manufacturing plant that specializes on developing nanosecond electronic components for select suppliers. As a job analyst my position requires that I evaluate each position in the company and ensure that a compensation structure is developed that is in line with the strategic goals and objectives of the organization which include having the workforce reflect the diversity in the community.

The use of automation and high tech systems has enabled the workforce to remain relatively low, less than 100, and may even substantially reduce the workforce in the upcoming years. The number of employees that must be reduced may be limited if employees are offered alternative forms of compensation rather than pay based incentives, which will decrease the overall financial burden on the company at large. Thus…...

Crafting a Compensation and Benefits Plan
Description

Fishers is a mid-sized manufacturing company out to maintain market leadership through the development and implementation of a compensation plan that meets the needs of the owners, clients, as well as employees. Compensation programs are critical to the effectiveness of the organization as they play a fundamental role in employee motivation, satisfaction, and productivity. The company seeks to achieve two crucial objectives from the implementation of this compensation and benefits plan; i) to reduce turnover, which has been an imminent problem over the last couple of years; and ii) to attract new talent, while retaining and improving the existing one.

Executive Summary

The company is at a critical juncture; it can no longer offer the perks of a small entrepreneurial enterprise since it has exceeded the employee threshold for such categorization. Employees have been complaining over what they think is below-market compensation, and noticeably, their morale appears…...

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References

Basset-Jones, N. & Lloyd, G.C. (2005). Does Herzberg's Motivation Theory have Staying Power? Journal of Management Development, 24(10), 929-943.

Beam, B.T. & McFadden, J.J. (2012). Employee Benefits (6th ed.). Chicago, IL: Dearborn Trade Publishing.

Cappelli, P. (2011). Why Good People can't Get Jobs: the Skills Gap and What Companies do about It. Pennsylvania, PA: Wharton Digital Press.

Miner, J.B. (2007). Organizational Behavior 4: From Theory to Practice. New York M.E. Sharpe.

Offering benefits such as healthcare and even stock options to lower-level employees, a compensation strategy also pursued by Starbucks (a company both literally and figuratively 'green' in its image), is another example of a policy that can benefit both the company and employees -- employees enjoy greater security, while the companies reduce the high rate of workplace turnover that is endemic to the service industry at companies like McDonald's. In fact, as Eric Schlosser observed in Fast Food Nation, fast food companies have often deliberately made life unpleasant for lower-level employees, to reduce the need to offer them promotions, benefits, and higher pay, on the theory that it is easy to train a new worker to operate a cash register. "How can workers look to this industry as a career…when it pays them the minimum wage and provides them no health benefits" (Schlosser 2001, p. 88). hole Foods and…...

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Works Cited

"Benefits." Google website. February 8, 2010.

http://google.com/international/en/jobs/lifeatgoogle/benefits/

"Careers." Whole Foods Market. February 8, 2010.

 http://www.wholefoodsmarket.com/careers/benefits_us.php

SBUX
Starbucks is a quick service restaurant that focuses on coffee and snacks. The company operates globally, with over 18,000 stores, roughly 55% of which are company-owned and the rest are franchised. Over 10,000 of these stores in are in the United States. Starbucks earned $14.89 billion in revenue in the last fiscal year (2013 Starbucks Annual eport). Starbucks employees are known as associates. In total, there are 191,000 associates (full-time equivalent) in the Starbucks system, most of whom work at the retail level (MSN Moneycentral, 2014). For this reason, this paper will mainly focus on the human resources policies that apply at the retail level.

Business Strategy

The basic business strategy that Starbucks follows is differentiation. The company seeks to provide a unique mix of product and service offerings that distinguish it from other locations where consumers can acquire coffee and snacks. The basic commodity, coffee, is difficult to differentiate but the…...

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References

2013 Starbucks Annual Report. In possession of the author.

Caldicott, S. (2014). How the minimum wage is reshaping workforce strategies. Forbes. Retrieved December 2, 2014 from  http://www.forbes.com/sites/sarahcaldicott/2014/07/18/will-starbucks-eat-mcdonalds-lunch-how-the-minimum-wage-is-reshaping-workforce-strategies/ 

Martel, L. (2003). Finding and keeping high performers: Best practices from 25 best companies. Employment Relations Today. Vol. 30 (2003) 27-43.

Moroko, L. & Uncles, M. (2008). Characterstics of successful employer brands. Journal of Brand Management. Vol. 16 (2008) 160-175.

Compensation
I believe that Keith was entirely justified in insisting that the job, not the person, be evaluated. If a company has established protocol, then that protocol should be followed. The receptionist in question has a boss who is in charge of evaluating her performance on a regular basis; the committee would likely be overstepping its boundaries if they had decided to evaluate a single person, rather than the position they were intended to evaluate. Keith would likely be justified in reminding the other committee members of their responsibilities and duties regarding the committee's purpose.

Initially, Keith was bothered by the possibility of a confrontation at the meeting with certain committee members. It would therefore behoove Keith to approach the situation with care and consideration, while maintaining a sense of balance and humbleness. One thing that Keith does not want to do is approach the other members of the committee with an…...

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References

Baumann, A. & Kolotylo, C.; (2009) The professionalism and environmental factors in the workplace questionnaire: Development and psychometric evaluation, Journal of Advanced Nursing, Vol. 65, Issue 10, pp. 2216-2228

Johnson, R.E.; Silverman, S.B.; Shyamsunder, A.; Swee, H.Y.; Rodopman, O.B.; Cho, E.; Bauer, J.; (2010) Acting superior but actually inferior?: Correlates and consequences of workplace arrogance, Human Performance, Vol. 23, Issue 5, pp. 403 -- 427

Roberts, G.E.; (2001) An examination of employee benefits cost control strategies in New Jersey local governments, Public Personnel Management, Vol. 31, pp. 301 -- 315

Tocher, N.; Field, H.S.; Giles, W.F.; (2006) Valuations of compensation and benefit items by new entrants into the professional workforce: Do men and women differ?, Journal of Employment Counseling, Vol. 43, Issue 2, pp. 84 -- 96

1. Hourly Compensation: Starbucks baristas are paid an hourly wage that varies depending on location and experience. Starting wage typically ranges from $9 to $12 per hour.

2. Benefits Package: Starbucks offers a comprehensive benefits package to its employees, including health insurance, dental and vision coverage, 401(k) retirement savings plan, paid time off, and discounts on store products.

3. Stock Options: Starbucks offers eligible employees the opportunity to participate in its Bean Stock program, which grants them stock options in the company.

4. Bonus Incentives: Starbucks employees may be eligible for performance-based bonuses and incentives based on individual and store performance.

5. Tuition Reimbursement:....

Starbucks' Comprehensive Compensation Plan

Starbucks, a global coffeehouse chain, offers a comprehensive compensation plan to attract, motivate, and retain talented employees. The plan includes a combination of base salary, benefits, and performance-based incentives designed to reward performance and drive company success.

Base Salary

Base salary is the foundation of Starbucks' compensation plan. Employees are compensated based on their role, experience, location, and performance. Starbucks regularly conducts salary surveys to ensure that its base salaries are competitive within the industry and local market.

Benefits

Starbucks provides a generous benefits package that includes:

Medical, dental, and vision insurance
Paid time off including vacation, sick leave, and holidays
....

In conclusion, the intricate relationship between managerial compensation and financial reporting quality is a critical aspect of corporate governance. Various compensation plans, particularly performance-based incentives, can influence managerial actions and impact the accuracy of financial disclosures. The delicate balance between incentivizing transparency and minimizing the risk of earnings manipulation highlights the complexities of aligning incentives with sustainable business practices. It is evident that executive compensation, especially stock options tied to stock price, can significantly affect financial reporting quality and may lead to misreporting behaviors. Equity-based compensation has been linked to incentives for misreporting, while regulatory efforts to promote whistleblowing can....