2. Practicing CBM
Prepared By:
Muhammad Anwar Arqam

3. READING MATERIAL
 Book: Compensation As A Strategic Asset
 Authors: August J. Aquila, Ph.D. Coral L. Rice
 Chapters #: Relevant to Exercises
 Internet Resources

4. EXHIBIT 1 - 1: Old Versus New Compensation Paradigms for Owners

5. EXHIBIT 3 - 1: The 7S Model

6. EXHIBIT 3 – 2: Organizational Effectiveness Cycle

7. EXHIBIT 4 - 1: The Profitable Firm’s Foundation

8. EXHIBIT 6 - 2: Sample Firm Compensation Philosophy and Guiding Principles
Eagle & Rice Compensation Philosophy and Guiding Principles:
■ To attract, retain, reward, and motivate the productivity and commitment of highly qualified
employees and owners.
■ To provide flexibility appropriate to the dynamic challenges facing professionals today.
■ To help the firm compete successfully for employees with the mix of skills vital to its mission.
■ To provide a flexible benefits package that allows employees to choose the appropriate
benefits for their individual situation.
■ To embrace a pay-for-performance system of total compensation
—We reward outstanding performance.
—Base compensation reflects above market average.
—Bonuses reflect performance.
—Primary responsibility for determining pay rests with you and your supervisor based on
achieving goals set forth in your win-win agreement.
■ Market considerations, overall firm profitability, or regulatory demands may cause the firm to
change its compensation and benefits practices. Employees should be aware that their benefits
may change from time to time as a result of firm policy decisions.

9. EXHIBIT
6
–
4:
Sample
Indicators/Measures
of
Success

10. EXHIBIT 10 - 1: The Ritz-Carlton’s Gold Standards
• The Gold Standards (as posted on The Ritz-Carlton Web site,
www.ritzcarlton. com) are the foundation of The Ritz-Carlton Hotel
Company, L.L.C. They encompass the values and philosophy by which the
hotel operates and include the following (with our bracketed comments in
italic).
THE CREDO
• The Ritz-Carlton is a place where the genuine care and comfort of our
guests is our highest mission. We pledge to provide the finest personal
service and facilities for our guests who will always enjoy a warm, relaxed,
yet refined ambience. The Ritz-Carlton experience enlivens the senses,
instills well-being, and fulfills even the unexpressed wishes and needs of our
guests.

11. THE MOTTO
At The Ritz-Carlton Hotel Company, L.L.C., “We are ladies and gentlemen
serving ladies and gentlemen.” This motto exemplifies the anticipatory
service provided by all staff members.
THE THREE STEPS OF SERVICE
1. A warm and sincere greeting. Use the guest’s name.
2. Anticipation and fulfillment of each guest’s needs.
3. Fond farewell. Give a warm good-bye and use the guest’s name. [There is
no confusion about how service should show up in behavior.]
SERVICE VALUES
1. I build strong relationships and create Ritz-Carlton guests for life.
2. I am always responsive to the expressed and unexpressed wishes and
needs of our guests.
3. I am empowered to create unique, memorable and personal experiences
for our guests.

12. 4. I understand my role in achieving the Key Success Factors and creating
The Ritz-Carlton Mystique.
5. I continuously seek opportunities to innovate and improve The Ritz-
Carlton experience.
6. I own and immediately resolve guest problems.
7. I create a work environment of teamwork and lateral service so that
the needs of our guests and each other are met.
8. I have the opportunity to continuously learn and grow.
9. I am involved in the planning of the work that affects me.
10. I am proud of my professional appearance, language and behavior.
11. I protect the privacy and security of our guests, my fellow employees
and the company’s confidential information and assets.
12. I am responsible for uncompromising levels of cleanliness and
creating a safe and accident-free environment.

13. [These service values, no doubt, build pride in The Ritz-Carlton, and they
would serve any accounting or consulting firm well. The lesson? Ask yourself
if your firm has values that are clearly stated and easy to understand. Just as
these service values provide guidance to Ritz-Carlton employees about how
to treat hotel guests and one another, your values should do the same.]
THE EMPLOYEE PROMISE
At The Ritz-Carlton, our Ladies and Gentlemen are the most important
resource in our service commitment to our guests. By applying the principles
of trust, honesty, respect, integrity and commitment, we nurture and
maximize talent to the benefit of each individual and the company. The Ritz-
Carlton fosters a work environment where diversity is valued, quality of life is
enhanced, individual aspirations are fulfilled, and The Ritz-Carlton Mystique is
strengthen
[The Employee Promise represents the mutual contract between employees
and the hotel.]

14. EXHIBIT 10–2: Setting Performance Goals (Sample Form)
Employee Name: _____________________________ Title: ______________
Leader Name: ________________________
When it comes to performance goals for this year, what would you like to
accomplish?
1. _____________________________________________________________
2. _____________________________________________________________
3. _____________________________________________________________
Please rewrite your goals to ensure they are performance targets (that is,
SMART goals: specific, measurable, achievable, relevant, and time-bound).

16. EXHIBIT 11–2: Sample Excerpt of a Competency Table

17. EXHIBIT 11–3 AICPA Competencies

18. EXHIBIT 11–4 Canadian Institute of Chartered Accountants
Competencies

19. EXHIBIT 12–1 Sample Tiered Pay for Performance System

20. EXHIBIT 12–4 Sample Firm-Wide Balanced Scorecard

21. Exhibit 12–5 Sample Owner Balanced Scorecard

22. EXHIBIT 12–6 Sample Manager Balanced Scorecard