7. Designing Pay Levels, Mix, and Pay Structures (Ch 8) Part 2(1).pptx

7. Designing Pay Levels, Mix, and Pay Structures (Ch 8) Part 2(1).pptx

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DESIGNING PAY LEVELS, MIX, AND PAY STRUCTURES PART 2 Chapter 8
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Road Map 1. Specify the employer’s competitive pay policy 2. Define the purpose of the survey 3. Select relevant market competitors 4. Design the survey 5. Interpret survey results and construct the market line 6. Construct the pay policy line that reflects external policy 7. Balance competitiveness with internal alignment (ranges, flat rates, and/or bands)
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5. Interpret the Results - Executive Compensation at Lincoln Electric, 2015 Verify the data First step is to check the accuracy of the job matches, and then check for anomalies, age of data, and the nature of the organizations. Accuracy of match Job similar but not identical? (conversion/survey leveling) Anomalies Does any one company dominate? Do all employers show similar patterns? Any outliers ?
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5. Interpret the Results - Executive Compensation at Lincoln Electric, 2015 Statistical Analysis Looking at three things: Frequency distribution Look for unusual shapes to identify problems with job matches, widely dispersed pay rates, or employers with widely divergent pay policies Central tendency Reduces large amount of data into a single number Variation Distribution of rates around a measure of central tendency
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Frequency Distributions - Executive Compensation at Lincoln Electric, 2015
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Central Tendency - Executive Compensation at Lincoln Electric, 2015
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Variation - Executive Compensation at
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