IKEA Employee Compensation Package
Company overview
IKEA is a home furnishing retailer known for its brand and products all across the globe. The company was founded in 1943. Since the foundation of the organization, the company has gone through ups and downs making several changes in its HR policies to be one of the reputed companies among the employees working in this industry. IKEA has a range of more than 9500 products that are sold through its more than 300 stores all around the world (Baraldi, 2008). There are millions of people working directly and indirectly for the company that acts as the backbone of the organization. The company has more than 600 million visitors to its stores and more than 500 million people visit its website every year. Hence, it is important for the company to maintain a proper compensation strategy to motivate its employees and enhance their performance to achieve customer satisfaction. The paper presents a job analysis for the position of a retail store manager and discusses the compensation policy to know how IKEA differs from its rival businesses.
Position
IKEA is one of the leading furniture retailers across the globe. It can be seen through a study that IKEA will open thirty two new stores at different locations in the country. Hence, there is a requirement for new sales executive and retail store managers to begin the operations of the upcoming stores. The fulfillment of the retail sales manager position is a priority concern for the Human Resource manager of the company. The retail managers will be responsible for managing each and every activity in the new stores (Ikea.com, 2016). They will be responsible for promoting sales in their respective stores by applying different methods of sales promotion techniques. Along with that, the retail sales managers will support the recruitment team in choosing new employees who are needed to be employed for commencing the operations of the upcoming stores. The company can choose the new store managers from the external market or else can employ people who are already working in the company. The new retail store managers can be helpful in reducing the burden of the recruitment team in selecting new employees.
Pay Scale
As the position of retail store manager has got the significant responsibility to be performed, IKEA offers massive yearly salary compensation to a store manager. Considering the job responsibility of a retail store manager, the company offers a salary range from $138,800- $189,200 per annum that can be termed as significant for any responsible employee (Ikea.com, 2016). The most of the essential tasks in the retail department have to be figured out by the retail store manager with sheer job responsibility. The salary compensation of such bulk amount can be provided to the store manager so that it can motivate the personal to apply more knowledge and skills to develop the organizational culture for corporate benefits. Additionally, the strong salary compensation of a retail store manager of IKEA can effectively bring the best man to the business to support the organizational structure.
Job description of a Retail Store Manager
The job description and specification of a retail store manager has been presented in the points given below:
The retail store manager must deliver excellent customer service and present professional attitude.
The retail store manager must achieve a high level of sales performance.
The retail store manager must hire talents that meet the needs of the company’s store.
The retail store manager must be an effective trainer and must have the knowledge to effectively counsel the employees and implement development plans for the betterment of the workforce (Ikea.com, 2016).
The retail store manager will manage the employees to execute daily tasks and maximize the sales.
The retail store manager must have the knowledge of financial reports to monitor the store profitability.
The retail store manager must review the operations reports and record them to ensure that the operations are carried by maintaining the company policies.
The retail store manager must maintain the visual standards of the store that includes the signage, merchandise presentation, lighting and general maintenance.
The retail store manager must be effective in solving problems and enhance the productivity of the employees.
The retail store manager is responsible for maintaining the inventories of the store.
Job specification of a Retail Store Manager
The job specification of a retail store manager has been presented below:
The retail store manager must have an experience of working in the retail market for minimum three years.
The retail store manager must have a management degree.
The retail store manager must have an experience of supervising a retail store employees.
The retail store manager must be have age between 30 to 35 years.
Both female and male can apply for the job.
He must be unemployed for more than 1 month to apply for the job.
The retail store manager must have knowledge of furniture products and furniture industry
The retail store manager must be a native English speaker and have computer knowledge.
Monetary and Non-monetary compensation
The IKEA does not only provide a job to its employees but also believes in providing a better life. There are several monetary and non-monetary compensations provided to the employees to make them have a better life with IKEA.
Monetary compensation
The monetary benefits that are offered to a retail store manager are discussed in the points given below:
Rewards: The casual co-workers are rewarded with $50 to spend in the store, part-time co-workers with $75 to spend in the store, and full-time co-workers with up to $100 to spend in the store every year. Along with that, the managers are allowed with $200 to spend in the store while senior managers are given $500.
Long Term Services Awards: For long-term services, the following awards are given:
$500 to spend in stores for a service of minimum 5 year
$1000 to spend in store for a service of minimum 10 years
$1500 travel voucher for a service of minimum 15 years
$3000 travel voucher for a service of minimum 20 years
$5000 contribution into super fund for a service of minimum 25 years
Non-monetary compensation
The non-monetary benefits that are offered to a retail store manager are discussed in the points given below:
Paid Leaves: The permanent workers of the company are provided with paid leaves. In addition to personal leaves and annual leaves, they are also provided with other leaves like Blood donor’s leave, career break, volunteer leave, wellness day leave and co-workers day leave. The company also provides the workers with paid time offs, sick leaves and other paid holidays (Rask, Korsgaard & Lauring, 2010).
Insurance, Health, and Wellness: The workers are provided with health insurance, dental insurance, flexible spending account, health savings account, vision insurance, life insurance, disability insurance, occupation accident insurance, accidental death insurance and many more.
Family and Parenting: IKEA gives its employees a maternity & paternity leave, dependent care, adoption assistance, military leave, family medical leave, extended unpaid leave and fertility assistance.
Financial & Retirement: The Company provides its employees with pension plan, performance bonuses, retirement plan and equity incentive plan.
Perks and Discounts: The employees of IKEA get free lunch and snacks, mobile phone discounts, legal assistance, travel concierge and employee discounts (Rask, Korsgaard & Lauring, 2010).
Professional Supports: The Company also provides job training, professional development program, tuition assistance, and diversity programs to its employees.
Advantage of a strong compensation plan
The advantages of a strong compensation plan for both the employees and employers have been given herein.
Advantage for employees
Identifying the precise job responsibility and efforts of the employees, a high compensation plan can create several reasonable chances within an organization. First of all, the reward compensation mechanism has invariably made a significant impact on the financial performance of the organization. Being motivated by rigid compensation structure of an organization, the employees are eager to work at their highest potentiality to get the bonus or other monetary benefits for their performance. Apart from that, merit-based salary and bonus compensation can create more competition among the organizational workforce to achieve the highest feat as far as performance deliverance is concerned. On the other hand, modern business organizations have developed latest and effective compensation plan as a part of risk management so that maximum profitability can be secured utilizing the potentiality of organizational human resources to the heist extent. On the flip side, employees’ action in the workplace can be undoubtedly influenced by a strong compensation plan. There are significant metrics that can be operated through a specific compensation program within an organization. For instance, in the case of services, if the organizational human resources have been offered bonus and other monetary promises, they can deliver their best shot in the work.
Advantage for employers
The employers of the organization can certainly improve the overall business performance through a strong compensation policy. As a result, the same process can lead to customers’ satisfaction, customers’ support development and customers’ retention. Therefore, the performance of the organization can be eventually benefited from the compensation plan. Meanwhile, a material compensation culture can develop the efficient performance of the human resources in multiple ways. Interestingly, the impact of a strong compensation plan can make a significant impact on the hiring process as best professionals from the talented pools can be included and retained for further organizational perspective.
Conclusion
IKEA uses innovative HR management practices to build a strong organization culture that promotes creativity and diversity. The employee friendly policy of the company makes it one of the best employers in the furnishing retail sector. The HRM policies of the company have helped it to sustain growth in this competitive market. The company has been listed in the top 50 most attractive employers in the world in the year 2010. Along with that, the company has won the title of the “Employer of Choice” in many countries across the globe.
References
Baraldi, E. (2008). Strategy in Industrial Networks: Experiences from IKEA. California Management Review, 50(4), 99-126. http://dx.doi.org/10.2307/41166458
Ikea.com,. (2016). Work areas - IKEA. Retrieved March 2016, from http://www.ikea.com/ms/en_GB/the_ikea_story/working_at_ikea/work_areas.html
Rask, M., Korsgaard, S., & Lauring, J. (2010). When international management meets diversity management: the case of IKEA. EJIM, 4(4), 396. http://dx.doi.org/10.1504/ejim.2010.033609
