Strategic Human Resource Management: Analyzing Pay Structure Report

This report evaluates the organization's current pay structure in comparison to its competitors, addressing how to determine comparable organizations by using best practice reports for compensation. It explores the consequences of an out-of-line pay structure on employee motivation, engagement, and retention, providing examples from companies like Apple and Microsoft. The report emphasizes the impact of pay and incentives on employee performance, highlighting the correlation between competitive pay structures and employee retention. Recommendations include implementing a standard compensation plan, providing appropriate incentives, and fostering a collaborative culture to ensure improved motivation, engagement, retention, and competitive advantages. The report emphasizes the importance of strategic human resource management in fostering a productive and engaged workforce.

Running head: STRATEGIC HUMAN RESOURCE MANAGEMENT
Strategic Human Resource Management
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Table of Contents
1. Determining Organizations for Comparison of Pay Structure...............................................2
2. Consequences of having Out of Line Pay Structure..............................................................2
3. Recommendations:.................................................................................................................3
References:.................................................................................................................................4

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1. Determining Organizations for Comparison of Pay Structure
All organizations face some kind of competition. It is therefore vital to identify
those competitors to maintain a standard pay structure to prevent others from gaining
competitive advantage. Thus, in order to determine the competitor organization, it is
necessary to consider Best Practice Report for Compensation that includes survey of
substantial number of Compensation and HR professionals and business leaders using the
best practice methods (Crawley & Tyler, 2015). This helped in identifying companies with
pay ranges of each of the position and group of jobs. It also helped in identifying
companies that does not follow a pay structure, uses a mixture of job based ranges and
grades.
2. Consequences of having Out of Line Pay Structure
An out of line pay structure in comparison to the competitors will result in
imbalance that will not only have an impact on the organizational culture and employee
motivation towards performance.
However, the impact of pay and incentive on (Hameed, Ramzan & Zubair, 2014):
 Employee Motivation: A better payment and incentive enhances employee
motivation thereby resulting in higher profits, productivity and customer’s service.
For example companies like Apple and Microsoft offering higher pay and incentive
structure comprises of higher level of motivated employees.
 Employee Engagement: Better incentive and payment structure leads to the better
engagement of employee who feels passionate thereby contributing in enhancing
productivity. For example, Corporations where employees remain engaged

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performs better compared to the companies where employee compensation is less
than 200 percent.
 Employee Retention: Standard compensation structure will also contribute towards
retention of employees. For example, in terms of payment and incentive structure,
Apple will have maximum number of retained employee compared to other
countries.
3. Recommendations:
1. Employee motivation can be enhanced by adoption of a standard compensation
plan along with applauding their results
2. Employee retention is possible through a well paid structure and incentive along
with providing an appropriate culture
3. Competitive advantage within the market place is only possible though
communication and collaboration along with a proper pay structure.

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References:
Crawley, F., & Tyler, B. (2015). HAZOP: Guide to best practice. Elsevier.
Hameed, A., Ramzan, M., & Zubair, H. M. K. (2014). Impact of compensation on employee
performance (empirical evidence from banking sector of Pakistan). International Journal of
Business and Social Science, 5(2).