Building market competitive compensation systems and building pay systems tha recognize employee contributions
What are the steps to developing an externally competitive compensation system?
- How do you use market survey data to benchmark salaries in the company?
- How do you select benchmark jobs?
- How do you integrate market data with internal job structure? Using regression analysis to decide what to pay different jobs. (in the exam, I could give you results from a regression output and have you interpret the results and use the results to decide pay levels for different jobs).
- How do you decide whether to match, lead, or lag the market?
- How can a company design a compensation structure recognizing employee contributions? (What are the steps)
- What is a pay grade? What is the purpose of establishing pay grades?
- Assuming you know the pay grade midpoint and desired range spread, how do you calculate the pay range within a grade?
- What is pay compression? Why is it a problem?
- What is broadbanding? When is it a good idea? What are the downsides?
- What is a two-tier pay system? Is it a good idea?
- What are some alternatives when designing a compensation system for salespeople? Is paying them by commission always a good idea?