Human Resource Management
Chapter 10
Reflection
The two case studies below are both on employee benefits. The first case study is about whether compensation packages for company CEOs and corporate executives. As evidenced by the case, using stock and cash incentives can motivate company leaders to steer their companies to greater success. The second case study is about reward systems for sales executives. The company in question chooses to have its sales representative work in groups and to pay members of each team equally from pooled commissions, regardless of who works the most. The case reveals the weaknesses or limitations of this approach.
Case Study 1
Question 1
Companies use different standards to determine or to calculate packages for their corporate executives and CEOs. Therefore, corporate executives and CEOs deserve the big packages that they get, provided they meet the set standards.
Question 2
I do not agree with Drucker. I believe that compensations should be based on individual achievements and abilities and should not be tied down by other employee’s pay. If this was to happen, then what would be the need to pushing ourselves beyond limits if our compensations will be tied down by other people’s pay? It is illogical and unfair to use other the hourly pay of other workers as the basis for calculating compensations.
Question 3
Yes, it is possible that the Act will influence the future size of the bonuses. Corporate audits involve executive pays too, and the SEC requires executive compensation packages listed under the NASQAD and NYSE to be disclosed.
Case Study 2
Question 1
Yes, the survey results clearly illustrate complaints from the team members, especially on the current system of giving incentives. Some representatives, for instance, have complained that other sales representatives are only “free-riding” and benefitting from the hard works of others. The survey results also indicate that one-third of them have requested a return to the individual system of giving incentives.
Question 2
I do not think that it is fair for members of one team to be paid equally because it is not possible that their contributions were equal. While working in teams yields better results for the company, I still think that the reward system should be individual based. I will, therefore, recommend a rating system for members of all teams so that rewards are calculated on the basis of contributions. This way, team members will get rewards equivalent to their input.