Ensuring fairness in pay for employees working similar jobs is referred to as internal equity (Kokemuller, n.d., para. 1). Organizations use job analyses and job evaluations to ensure that compensation structures are fair. Moreover, organizations user e-compensation tools to ensure internal equity. However, there are potential barriers that prevent organizations from realizing the potential of Web-based internal equity tools. First, organizations should select e-compensation tools that integrate with their existing system and compensation plan needs. Moreover, organizations should ensure that the software is web-enabled. According to Gueutal and Stone, “while there are a growing number of software programs in the market that support the design and maintenance of internal equity policies and practices, relatively few are currently both integrated and web-enabled” (Gueutal & Stone, 2005, p. 173). It is imperative that the project team chooses a software vendor that is familiar with its organization and type of industry. Choosing the wrong software provider can result in an inadequate or incompatible software solution. However, to mitigate this risk the project team should send software vendors a request for proposal (RFP). An RFP lists the company’s critical needs of the compensation system (Kavanagh et al., 2012). This allows vendors to align their services …show more content…
E-compensation tools assist companies with the retrieving and processing critical data that ensures internal and external equity. Moreover, HR and functional managers can access critical data at any time through the use of web-based tools. This provides senior leaders the information needed for compensation planning and decision support in e-compensation systems. However, organizations need to manage risks and avoid barriers that prevent organizations from realizing the potential of Web-based tools. Strategies to avoid barriers include integration, training, and ensuring that data received from external web-based sources are accurate and up-to-date. Overall, e-compensation tools give companies the technological advantage to improve efficiency and ensure equitable