Compensation Strategy Report: Henderson Printing Case Study

This report delves into the compensation strategy employed by Henderson Printing, highlighting the shortcomings of its current managerial approach, which relies heavily on the owner's subjective judgment. The report analyzes the existing performance pay elements and proposes a comprehensive workers' compensation mix, including base pay, indirect pay, and performance-based incentives. It emphasizes the importance of measuring the effectiveness of the compensation mix through employee reactions and behavioral changes. Furthermore, the report addresses legislative acts of employment, profit sharing, and the challenges associated with compensation, offering recommendations for Georgette, the owner's daughter, to improve employee satisfaction, motivation, and productivity. The report emphasizes the need for a structured and equitable compensation system to ensure fair treatment and foster a positive work environment.

Running head: compensation strategy.
Compensation strategy
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Compensation strategy
Table of Contents
Introduction......................................................................................................................................3
Managerial strategy.........................................................................................................................3
Performances pay elements that Georgette should maintain...........................................................4
Workers compensation mix.............................................................................................................5
Measure of effectiveness of a compensation mix............................................................................7
Legislative acts of employment.......................................................................................................8
Profit sharing...................................................................................................................................8
Compensation challenges and how to deal with them.....................................................................9
Conclusion.......................................................................................................................................9
Reference.......................................................................................................................................10

Compensation strategy
Introduction.
For any business to survive, it has to embrace a concrete record of work, employees, sales and all
matter pertaining the business. Failing to have this clear documentation creates high chances of
failure of the business. In a company that don’t have employees record, the employer encounter
issues like; the employer cannot retrieve any information about the employee in terms of skills
he posses, level of education and the duration the employee have been working in the
organization. It therefore becomes difficult for the employer to know who deserve what amount
of compensation bringing in misunderstanding between employer and the employees.
Managerial strategy.
This refers to the type of management employed to set the objectives of a business and the means
that will be used to achieve this goals. Henderson printing applies a human relation managerial
strategy where no formal workers, work and employer relation exist. Henderson is the manager
with no help of a well structured administration, he focuses only in production and compensation
is not well legalized and decision on compensation is made by the employer based on how you
relate. This system is not effective as Henderson makes payments that vary from one employee
to another without a well defined guideline, in this case his emotions or what he can remember
about you is the main determinant. Otherwise he will use an alphabetically arranged list of
employees to make decisions on what amount of compensation each should get. The employees
receive less satisfaction from this kind of compensation especially when Henderson can’t relate
your name with the face or remember something cheerful about you or you are a new employee,
due to this reason the compensation that each get have very little match with his skills or the
level of education and therefore most of these employees raise with him on compensation of
which it depends with his mood at that particular time. This kind of compensation has destroyed

Compensation strategy
an employees’ morale to work leading to formation of unions especially when he remember that
the boss don’t know him or if he is newly employed or they had fallout with the boss sometime
back.
Performances pay elements that Georgette should maintain.
Compensation element Pro cons
Base pay All workers feel equally
appreciated on their
contribution toward the
business progress.
Hardworking workers feel
unrecognized and not
appreciated lowering their
morale
Lack of competition in
performance
Favorer old employees
Indirect pay
It’s a step to betterment.
It difficult to maintain
everyone happy
Increases social security. Expensive to run by the
managementHealth and wealthy
maintenance
No favoritism to seniors Subjectivity and multitasking
resulting to errorsImproves working culture

Compensation strategy
Performance pay Difficulty of legalization and
authentication.Creates motivation
Increases productivity
Sick off should be given to those who are infected, this is because it is beyond human control
and no one should lose his job for falling sick, however this should only be done for a particular
amount of time (Dollah,Mustaqimah,2016). Georgette should also continue giving merit bonuses
to the workers contributing towards the profit made by the business, this helps to boost their
morale at work. Payment based on employees having lost their relative or has family members to
support or the family has grown in size either by adoption or birth should be abandoned as all
this do not count toward the business progress. Bonuses award should be formalized instead of
going through workers list arranged in alphabetical order and giving award on consideration of
what you can remember about the employee. As a consultant I would urge Georgette to initiate a
program of awarding workers with tangible goods for life like food, clothing and houses to
cultivate their motivation. Also it is healthy to give award of achievement in terms added
responsibility to create a sense of pride and accomplishment to workers thus boosting their
morale. These awards however have to be competitive and meet the regulation of the rule of law
of the governing council; also the procedure of awarding should have just and fair procedures
well communicated and equity awards.

Compensation strategy
Workers compensation mix.
Compensation of a worker is the reward he gets in return of what he offers to any organization
and should be looked into with a lot of concern. Therefore there is a need to establish a solid
strategy to rewarding workers in a just manner in order to get them satisfied and plough an
amount to maintain the running of organization and still make a profit.
Any successful workers compensation should include the base pay, indirect pay as well as the
performance pay of every worker. Base pay is being the initial compensation of a worker to the
services offered must form the biggest percentage of total earning as this remain being the little
amount of compensation he expect in exclusion of incentives and pensions (Berger, 2009) Most
workers consider this reward with a lot of concern especially when you are about to get into
employment contract with the employer. This reward however is arrived at by the employer
through evaluation of several factors, level of education, skills and experience to the type of
work in question carries the day but this does not mean that those with high level of education
and long time working experience should expect extremely high compensation as the worker still
have to consider the current market pay and the duration of working time in a day. To my
understanding this compensation type should constitute 75% of the total expected compensation
of the worker. This will help create a good morale of worker towards work at the very first days
of employment and prevent him from joining unions even possibly before the first pay.
In every organization, it happens by default that there is given group of workers who goes an
extra mile to ensure that the company attains its goals. This category of works should be
motivated to keep the spirit high and encourage the others to copy the working habit of the best
workers in the organization. This category of workers is the type of workers who work for the
organization on over time and those that have the best performance in terms of quality

Compensation strategy
productivity. Whether production is done in groups or individual, this kind of reward should be
done on individual basis with well defined and communicated measures because the achievement
started at the personal level and should constitute of 15% of workers compensation in order to
create a performance competition that will lead to quality of the organization.
As much as base pay and performance compensation are important, also indirect pay. The morale
of a worker to work in health hazard environment should be initiated with this particular kind of
compensation. Also workers feel well catered for when assured of retirement benefit and
therefore concentrate with company’s work rather than extra activities to cater for their needs
after retirement. Heath and wealth are like brothers and therefore any organization needs to cater
for its workers health at all cost to maintain a regular report to work where quality and quantity
production is achieved. All these can be attained by giving pension to workers, establishing a
health facility where workers can get first aid services in case of accident in the line of duty,
giving out gifts goods for life like food clothing and shelter or bonuses during festive seasons,
sick offs and leaves. This kind of compensation should amount to 10%, it will help maintain the
presence of workers at work in cases where lack of the above services would result to
absenteeism, and this will also increase the morale of workers to work.
Measure of effectiveness of a compensation mix.
The effectiveness of the above compensation mix to Henderson printing can be determined by
observing the reaction of workers and the new behavioral change at work (Vyas, Singh, 2015.
When workers are not satisfied with what they get in return they tend to exercise abnormal
absenteeism to work because they don’t have the morale to work, in most cases this is
accompanied with formation of unions in the organization, this unions’ objectives to plan on

Compensation strategy
compensation negotiation with the employer and if it fail they plan on protest on pay rise. If
these cases seem not to exist anymore in Henderson printing, then the mix can be certified to be
effective.
Legislative acts of employment.
This refers to the laws governing an organizations employee’s employer’s relationship. In
Henderson Printing this rules are not put into application. The law that protects employees
against discrimination is violated during payment where if the owner of the business remembers
something bad about you or does not match your face and name you end up getting a little
amount of compensation regardless of your skills and performance (Xiaoguang, Wei, Huo,
2014). Discrimination also is evident in that majority of the workers in this organization are
family members of the owner suggesting that if you are not of Henderson linage then you stand
low chances of securing a working opportunity in this company. The low of minimum wage is
also broken and a worker does not know what amount he stand to earn after a given period of
working in this organization and this remains to be determined by the employer only.
Profit sharing.
This is a payment plan where an organization share the profit earned with the employees in a
defined formula after a particular period of time. In the sharing process everyone is considered as
an individual, therefore this type of reward tends to greatly benefit executive individuals who
carry large shares than regular workers with a big percentage. This kind of compensation is not
conducive in to practice in Henderson printing as the sales are expected to drop after a particular
period of time because the market of its product is only concentrated in Halifax, therefore there
is expected drop in profit unless the business expands its market. Since profit sharing in long run

Compensation strategy
is viewed as a right by workers, its reduction may cause inconveniences to works (Mistar,
Zuhairi, 2016). This kind of compensation also excludes minor employees on knowing what the
progress of the organization as the duty is only for the executive.
Compensation challenges and how to deal with them.
The biggest daring challenge of any entrepreneur is bearing risk. Henderson company is an
example of a company that has incurred loss by the time it’s about to be inherited by Henderson
daughter; Georgette (Santos, Araújo, Barbosa Santos, Pereira Silva, Vilela, 2017. All the same
this should not lead to delayed employees payment after the transition of possession, instead
Georgette should first establish a well defined accounts keeping record with the help of an
accountant and seek for an alternative source of funding from the government bank or friend and
pay the employees to maintain a good working relationship. Employee’s compensation should
not be delayed at any cost.
Conclusion.
To sum up, it is important to establish a well defined workers work relation where workers know
what is expected of him and what is the compensation on the same. Also its good to keep in mind
that human being need motivation to keep moving and therefore workers should be given their
compensation on time and in equitable and just amount to boost their morale rather than
exploiting them.

Compensation strategy
Reference.
Berger, L. A. (2009). The Compesation Handbook: A state-of-the-Art guide to compesation
strategy and Design.
Dollah, S., & Mustaqimah, M. (2016). The Attitude of Hotel Department Students towards
Learning English in Relation to their Learning Strategies and Achievement in Indonesian
Context. The Asian EFL Journal Proffesional Teaching Articles October 2016 Issue 95,
1-124.
Haryadi, S., Sanny, L., & Antonius, V. (2012). Effect of Compesation and Conflict Management
on Employee Retention and Its Impact to Employee Performance at Pacific Jaya Niaga
Company. Jurnal Manajemen DeReMa, 7(2), 33-46.
Mistar, J., & Zuhairi, A. (2016). Strategies of Maintaining English Proficiency by Indonesian
Lecturer of Non-English Department: a retrospective study. AL BUHUTS, 16(2).
Santos Bomfim, E., Brasil de Araújo, I., Barbosa Santos, A. G., Pereira Silva, A., Alves Vilela,
A. B., & donha yarid, s. (2017). nurse activity on educational practices in the family
health strategy. Journal of Nursing UFPE/Revista de Enfermagem UFPE, 3.
Vyas, R., & Singh, S. (2015). Reference Current Estimation by pq Theory for Harmonic
Compesation of Unbalanced & Nonlinear Loads.