Submitted by: Submitted by khurramazhar1408
Views: 10
Words: 613
Pages: 3
Category: Business and Industry
Date Submitted: 01/26/2016 07:37 AM
Q2 ;- what are important external and internal enviormental variables affecting compensation plans ? which are most important ? why?
Number of factors influence compensation plans and they are catagorised in two factors
1 external factor
2 internal factor
Internal factors;
These includes the following
• Ability to pay
• Employee
• Seniority
• Potential
• Job requirements
• Job evaluation
• Organization strategy
Ability to pay
This is one of the most important factor that influence employee compensation plan that most a firm, which is well established and successful and has the ability to pay more than the competitive market rate This way it can attract a superior caliber of individual although the labour unions also demand an increase in compensation on the grounds that the organisation is prosperous and is able to pay.
Employee
employes related factors also influence compensation and It is always rewarded wirh pay increase and as a result it motivates the workers to do better in future and this makes a person perfect by providing valuable learning and rewarded also. Today companies are recruite for 10 to 20 years experience candidates especially for the executive positions the companies presume that experience candidate has leadership skills which influence the other behavior and performance and candidate perform the job without need of training which is time consuming and deals with matter of cost to company.
seniority
today's environment seniority of employee making difference in payment of compensation compared to Junior employees senior employees demands for more salary than fresher because of their hold on related job and its functions n today many companies are demanding senior employees for key positions by given them more pay and even sometimes retired employees are offered with handsome salary for key positions which deals with multitasking in organisation. Trade unions always prefer this objective criterion for pay rises....