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Human Resource Management   TENTH EDITON Variable Pay and Executive Compensation © 2003 Southwestern College Publishing. All rights reserved. PowerPoint Presentation  by Charlie Cook Chapter 13 SECTION 4 Compensating Human Resources Robert L. Mathis     John H. Jackson
Learning Objectives ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Learning Objectives (cont’d) ,[object Object],[object Object]
Variable Pay: Incentives for Performance
Types of Variable Pay Plans Figure 13 –1
Factors Affecting Variable Pay Plans Variable Pay Plan Success Does the plan fit the organization? Are the right behaviors encouraged by the plan? Is the plan being administered properly?
Factors for Successful Variable Pay Plans Figure 13 –2
Individual Incentives Individualism Stressed in Organizational Culture Identification of Individual Performance Independent Work Individual Competitiveness Desired Individual Incentive Pay Plans
Piece-Rate Systems ,[object Object],[object Object],[object Object],[object Object]
Bonuses and Special Incentive Programs ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Sources of Bonuses Figure 13 –3 Source: Kathryn F. Clark, “Incentives Increase But Competitive Base Salary Key in Talent Race,” Human Resource Executive, June 2, 2000, 30. Used with permission.
Different Bases for Sales Incentives, In Order of Use Figure 13 –4
Sales Compensation Plans ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Why Organizations Establish Team Pay Plans Figure 13 –5
Group/Team-Based Variable Pay Distributing Team Incentives Determining Individual Rewards Timing of Team Incentives  Deciding the  Allocation of Rewards
Conditions for Successful Team Incentives Figure 13 –6
Gainsharing ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Profit Sharing ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Profit-Sharing Plan Framework Choices Figure 13 –7
Employee Stock Ownership Plans (ESOPs) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
U.S. CEO Remuneration Figure 13 –8 Source:  The Economist , May 8, 2000, 16.
Executive Compensation Components  Figure 13 –9
Common Executive Perks Figure 13 –10
Arguments in the Executive Pay Debate Figure 13 –11

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