Compensation Design determines the contribution of specific, properly executed activities to the achievement of organizationally desirable outcomes. The value of the accomplishment, not the level of activity, is used to establish the nature and amount of compensation. Ultimately, compensation design should foster a productive and equitable, long-term relationship among members, and between each member and the organization.
The process begins by identifying desired outcomes for the organization, or operating unit. Importance and value are attached to the results people achieve with reference to the needs of the organization. Compensation is based on the achievement of results that are critical to organizational success.
The Compensation Design process will enable you to:
· Determine the critical goals for your organization
· Translate critical goals into realistic performance expectations
· Establish specific performance responsibilities
· Develop accurate performance measures
· Compensate employees for results and value received.
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