Introduction
Risks and benefit with leading the market in overall compensation and benefits
Upholding internal and external equity in compensation and benefits
Internal and external equity is an important component of compensation and benefits system since it assures employees of fairness in base pay and additional benefits. Party Supplies employees are more likely to compare their pay to that of others performing similar roles in other firms and reflect on the fairness and equity. For this case, therefore, the company needs to carry out salary surveys across organizations to determine the average and slightly adjust its rates to be lead the market in overall compensation and benefits. Employees are therefore assured of their worth in the company and the commitment by the management to offer incentives that fulfill socio-economic needs of workers (Adewale, et al., 2014). The firm is, therefore, likely to experience improved innovativeness and creativity, minimal retaliation as well as desired collaboration for sustainable growth and stability.
Attracting, acquiring, motivating and retaining high-quality talents
Unique talents are critical in the modern business environment since it puts Party Supplies in a better position to innovatively come up with new and better ways of doing business. Being a leader in compensation and benefits, therefore, offers the company greater advantage in minimizing threats and weaknesses while maximizing strengths and opportunities through high-quality employees. The system also reduces the risk of employee turnover since it motivates staff to be loyal to the firm thereby reducing the cost, time and effort spent in acquiring, training and developing new workers (Adewale, et al., 2014). Staff turnover adversely affects company's operations and reduces chances of acquiring unique talents hence the need to provide desirable base pay, paid annual leaves, house allowances, sick leaves, health and medical insurance that motivate and play part in retaining best staff.
Abiding by industry’s and legislative requirements
The major objective of Party Supplies compensation and benefits system, therefore, is to attract, motivate and retain high-quality staff who understand the goals of the company and how to innovatively achieve them currently and in the long run. Party Supplies also has to realize that offering average pay locks it out from attracting, acquiring and retaining top talent hence limits growth objectives of the firm (Adewale, et al., 2014). Consequently, the company should seek to eliminate income inequality internally and externally to avoid incidences of high turnover and low productivity as a result of low staff morale. Pay Acts that have in recent years used to test employers’ commitment to effective pay and incentives.
Appropriate compensation and benefits strategy for the firm
Party Supplies compensation and benefits strategy should prove internal and external equity by offering base pay and incentives that are leading in the market. However, while acknowledging the need for better pay and benefits compared to competitors, it is imperative that metrics be based on employees’ knowledge and skills, years of service in the company, the responsibility levels, and the experience they have. The company needs to recognize the fact that choosing to lead in compensation and benefits could raise payroll expenses but also opting not to pursue unique talents like staff with unique market analysis, customer networking and ICT skills could keep it away from competing for market share.
The major objective of Party Supplies compensation and benefits system, therefore, is to attract, motivate and retain high-quality staff who understand the goals of the company and how to innovatively achieve them currently and in the long run. Party Supplies also has to realize that offering average pay locks it out from attracting, acquiring and retaining top talent hence limits growth objectives of the firm (Adewale, et al., 2014). Consequently, the company should seek to eliminate income inequality internally and externally to avoid incidences of high turnover and low productivity as a result of low staff morale. The hourly rates offered by the firm, annual base pay increment, and annual bonuses according to the goals of the company need to be among the priorities when designing and implementing the system. Furthermore, house allowance, medical and health insurance, annual leave and sickness allowances and overtime pay will also form part of the packages as the firm aims to be a leader in compensation and benefits.
Conclusion
Employees need appreciation for them to be motivated and choose to be part of an organization for long. Fairness in pay in relation to those performing similar roles in other firms and in accordance with the relative value of their skills, experiences and job responsibilities is critical for firm's survival in modern dynamic business environments.
References
Adewale, O., Anthonia, A., & Olubusayo, H. (2014). Compensation packages: A strategic tool for employees’ performance and retention. Leonardo Journal of Sciences, 65-84. Retrieved from http://ljs.academicdirect.org/
WorldatWork. (2011). Total Rewards Model: A Framework for Strategies to Attract, Motivate and Retain Employees. New York: WorldatWork. Retrieved from www.worldatwork.org/totalrewards
Xiao, Q., Qi, H., & Lei, X. (2009). Total Reward Strategy: A Human Resources Management Strategy Going with the Trend of the Times. International Journal of Business and Management, 177-184. Retrieved from www.ccsenet.org/journal.html
