Section C Compensation Strategy for Zenith Compensation is a vital stimulus when rewards are given for the achievement

of the desired organizational results. It is said that money is a powerful source of motivation. Achievement of the desired performance is important in order to enrich the effectiveness of the organisation, this increases the possibility of success. The compensation policy adopted by Zenith reflects the strategic objectives of the business. Compensation strategy can reinforce the organisational culture that is desired. This enables organisational culture under which pay is linked. Zenith needs to focus on the job families to apply the suitable compensation strategy. According to the text book job family is defined as A series of progressively

higher, related jobs distinguished by levels of knowledge, skills, and abilities (competencies) and other factors, and providing promotional opportunities over time (Long,2010). For example in a restaurant a waiter is hired to complete the day-to-day tasks and duties. A waiter can be a high school graduate student who has very little experience, whose skills are being developed and who would be given responsibilities at a lower level than those with experience. On the other hand the senior waiter which is also called head waiter would be one with many years of experience whose skills and competencies are fully developed and who completes the job duties of high level. Therefore, the worth of the waiters diverges widely based on the experience, competencies and the responsibilities he/she has. The main purpose of Job family is to develop competencies of the workforce through better selection and placement and it also helps to increase training and development participation of the employees. . Zenith needs to determine the job family so that they can increase the retention of competent employees and also it will help to improve an individual employee s performance and contribution. Determining the job families has a huge impact on managers to make staffing decisions which allow flexibility to managers to assign job duties. Job families function to deliver both a structure for departmental human resource decisions and a career hierarchy by which an employee may plan his/her proficient growth and encroachment. A job description for a job within a job family defines, in broad terms, the duties and responsibilities one would be expected to accomplish at the several levels within a job family. The levels within a job family are defined more on the competencies estimated

by the employee rather than a list of precise tasks and responsibilities. The number of levels for a job family is determined by the value of the job in the marketplace and to the institution.

Job Family

Names of the Job included in the Job Family

Administrative job family

Secretary, Clerks, Compensation clerks and officers Marketing and sales

Communication job family

Application programmer job family

Junior, intermediate, senior application programmers System Installation, System Integration, Systems Marketing specialist Directors, managers, supervisors of all departments

High-quality professionals job family

Leadership job family

For Zenith, we figured out the job families and used a tabular form to make it simple, where one can see that there are six job families, and under each family, definite jobs have been itemised.

Administrative job family is listed as the first job family, under it, the secretaries and the clerks of various departments in Zenith are recorded. The work which is done by clerks and secretaries are routine work in which they follow the instructions of their seniors and achieve the work that is given by them on daily basis. This kind of work requests very little knowledge and also fewer skills, therefore this kind of job require task behaviour from the employees. The employees take instructions from their seniors and get the job done in a given time frame. The employees should get fixed base pay salary and Zenith should also provide meaningful and affordable healthcare benefits. This will help the employees to job security plus benefits, and by this, it will attract and retain the existing employee. Base salary of an employee should be determined by the level of experience, the market rate and internal equity for new hires, transfers, promotions and adjustments. Future growths in base salary should be determined by individual performance as gauged through the performance management process. Required Behaviour Task Behaviour Compensation mix Base pay, pension plan Mandatory Benefits Health care benefits Performance Incentives (threshold) Pension plan Task of compensation mix Job Security Retain employees Attract new employees Motivation for work Retention

Communication is the second member in the job family where the executives of marketing and sales are listed. They do the major communication with the customers and take the benefit of their communication skills to influence the customer to buy the company s product. The behaviour required for this job family is the membership behaviour, as they are the first channel through which company will get introduced to the new customers. Marketing and sales employees represent the company to existing and the new customers, therefore their behaviour should be proper and should benefit the organization. They must get a respectable base salary which should be comparatively higher than the market base bay, to attract and create a difference in the market. Similarly individual targets needs to be set plus a team incentive plan, which will motivate an individual to work hard as well as employees will work in teams to accomplish the team incentives. This compensation mix will bring a healthy internal competition as well as company will be benefited simultaneously. Required Behaviour Compensation mix (Base pay, Task of compensation mix

Performance pay, Indirect pay)

Membership Behaviour

Lead Base pay, pension plan Mandatory Benefits Individual Incentive plan Team incentive plan Commissions

Job satisfaction Job security Exerts Motivation Focus on shared Goal

Application programmer is the third member, and under it, juniors, intermediates and senior application programmers are listed. They are the one who are skilled workers, people with precise qualifications and a university degree in computer science can work as an application programmer. The tasks that an application programmer needs to undertake are entering the codes into computer system, generate applications such as Oracle forms. This job family is a core family of the company therefore organization citizenship behaviour will be vital from this job family. In this job family, the employee needs to willingly undertake special behaviour that is advantageous to the organization. The employees need to be creative and generate ideas to develop new software helping the organization stand out in the market. Zenith need to use a very healthy compensation mix for this job family. All the employees in this job family should get base salary and a flexible benefit plan that aids individual employees to choose the benefits that are best suited to their specific needs. Nevertheless, a basic or core benefits package of life and health insurance, sick leaves, and vacation ensures that employees have a minimum level of coverage will be provided to all employees. The flexible benefits plan will help the employees to advance greater understanding of the benefits offered to them and the costs incurred. Zenith can maximize the psychological value of their benefits program by paying only for greatly desired benefits. By this plan Zenith will gain competitive advantage in the recruiting and retention of the employees. Zenith should also include the this job family into profit sharing plan of the company which will encourage the employees to use their potential to find out innovative ways to enhance their skill to develop software for the company.

Required Behaviour

Compensation

mix

(Base

pay, Task of compensation mix

Performance pay, Indirect pay) Organization citizenship behaviour Lead base salary, pension plan Mandatory Benefits Flexible Benefits plan Profit Sharing plan Job satisfaction Security Attract and retain employee Motivation for development

High-quality professionals is the fourth member of the job family, under this job family, the system installation, system integration, system marketing specialist are listed. The employees holding position in this job family are either qualified from good university and hold a degree in a specialized field or he/she has an experience of several years in one field of work. Zenith should enforce task behaviour from this job family, they are used for training purposes and undertake the task assigned by the management. They are very vital for the organization as the new employees in the organization have to go complete proper training so that they can advance their skills in the specific area of work. There is a need for highly qualified and experienced trainer to train the employees properly. Consequently to attract and retain employees, there is a need for a good amount of pay of the base salary and bonuses for the performance of the task. A non-contributory pension plan should be added into the compensation mix in which the contribution to plan are made solely by the company. This motivates the employees to perform their tasks effectively, and noncontributory pension plan will tempt the employees to stay with the organisation, following the effective retention.

Required Behaviour

Compensation

mix

(Base

pay, Task of compensation mix

Performance pay, Indirect pay) Task Behaviour Lead Base salary Mandatory benefits Bonuses Non-contributory pension plan Group and Individual performance Job satisfaction Security Motivation to perform well Retention

Leadership is the fifth member in the job family, where all the directors, managers and supervisors are listed. The employees here, poses a very high level of qualification in their particular field of study, they even have several years of practice and proficiency in their significant field. It is very essential for an organization to have stable employees at this level, thus Zenith needs to make sure they get compensated in the way that satisfies their higher order needs and makes them stay with the organization for longer period of time. Zenith needs to acquire citizenship behaviour from this job family and in order to obtain this they need to pay a appropriately high base salary and well-defined benefit plan in which the amount an employee is to obtain upon retirement is specifically set forth. They should also offer gain sharing to this job family to keep them motivated to accomplish the goals set by the organization.

Required Behaviour

Compensation

mix

(Base

pay, Task of compensation mix

Performance pay, Indirect pay) Organization citizenship Behaviour Lead Base salary Mandatory benefits Defined benefit plan Gain Sharing plan Group and Individual performance Job satisfaction Security Retention Motivate leadership Motivate individuals in Team

In order to apply effective compensation mix, zenith needs to concentrate on one of their compensation policy. The policy which needs that compensation levels and decisions about employee compensation be kept secret and prohibit employees from revealing their compensation information to anyone. This policy will avoid misperceptions and distrust of compensation fairness and pay for performance standards among employees.

Compensation Strategy Template for Each Job Family

Job Family: Administrative Base Pay Job Evaluation Market Pricing Pay For Knowledge Proportion of total 50% 40% 10%

Performance Pay Individual Performance Pay Commissions Team Performance Pay

Proportion of total 10% 10% 30%

Indirect Pay Mandatory Benefits Pension Plan Health And Life Insurance Employee Services Other Benefits

Proportion of total 30% 5% 5% 3% 2%

Job Family: Communication Base Pay Job Evaluation Market Pricing Pay For Knowledge Proportion of total 50% 40% 10%

Performance Pay Individual Performance Pay Commissions Team Performance Pay

Proportion of total 10% 10% 30%

Indirect Pay Mandatory Benefits Pension Plan Health And Life Insurance Employee Services Other Benefits

Proportion of total 30% 5% 5% 3% 2%

Job Family: Application programmer Base Pay Job Evaluation Market Pricing Pay For Knowledge Proportion of total 50% 40% 10%

Performance Pay Individual Performance Pay Commissions Group Performance Pay

Proportion of total 10% 10% 30%

Indirect Pay Mandatory Benefits Pension Plan Health And Life Insurance Employee Services Other Benefits

Proportion of total 30% 5% 5% 3% 2%

Job Family: High-quality professionals Base Pay Job Evaluation Market Pricing Pay For Knowledge Proportion of total 50% 40% 10%

Performance Pay Individual Performance Pay Commissions Group Performance Pay

Proportion of total 10% 10% 30%

Indirect Pay Mandatory Benefits Pension Plan Health And Life Insurance Employee Services Other Benefits

Proportion of total 30% 5% 5% 3% 2%

Job Family: Leadership Base Pay Job Evaluation Market Pricing Pay For Knowledge Proportion of total 50% 40% 10%

Performance Pay Individual Performance Pay Commissions Group Performance Pay

Proportion of total 10% 10% 30%

Indirect Pay Mandatory Benefits Pension Plan Health And Life Insurance Employee Services Other Benefits

Proportion of total 30% 5% 5% 3% 2%