Compensation Compensation is the rewards that employees receive for doing their jobs (Martocchio, 2013). There are two types of compensation, intrinsic and extrinsic. Intrinsic compensation is the fulfillment of motivation that keeps an employee motivated to work. They are intangible and come from within the person doing the activity. An example of an intrinsic compensation is an employee being involved in the decision making process. Extrinsic compensation is a tangible award given to an employee for accomplishing something. They can be monetary or non-monetary. An example of a monetary extrinsic compensation is an employee’s salary. An example of a non-monetary extrinsic compensation is a certificate of accomplishment (Wu, 2015).
Compensation …show more content…
There are three key components a company should consider when creating their compensation strategy; pay, benefits, and careers. Pay is a key component that will position a company competitively on the market. Typically, higher pay attracts more skilled employees and helps reduce turnover rates. However, a company cannot simply attempt to lead the market in pay since it can be costly. It is important to also base pay on the company’s key values and objectives. Some examples of pay are base pay, overtime pay, short-term incentives, long-term incentives, and cash profit …show more content…
They allow employees to improve their performance and skills. They represent the future value to employees of staying with a company. Many companies offer some specialized career opportunities in order to help retain employees. Some examples of careers are skills enhancements, leadership development, career advancement, promotions process, and employment stability. Having a compensation strategy that includes pay, benefits, and career management helps a company remain competitive and retain employees (“Compensation Strategy,”
Compensation …show more content…
There are three key components a company should consider when creating their compensation strategy; pay, benefits, and careers. Pay is a key component that will position a company competitively on the market. Typically, higher pay attracts more skilled employees and helps reduce turnover rates. However, a company cannot simply attempt to lead the market in pay since it can be costly. It is important to also base pay on the company’s key values and objectives. Some examples of pay are base pay, overtime pay, short-term incentives, long-term incentives, and cash profit …show more content…
They allow employees to improve their performance and skills. They represent the future value to employees of staying with a company. Many companies offer some specialized career opportunities in order to help retain employees. Some examples of careers are skills enhancements, leadership development, career advancement, promotions process, and employment stability. Having a compensation strategy that includes pay, benefits, and career management helps a company remain competitive and retain employees (“Compensation Strategy,”