HRM/531 Human Capital Management University of Phoenix February 01, 2010 Career development plan part- IV Compensation February 1, 2010 To: Human Resources Manager From: Chandan Gulati Re: Compensation Proposal for Sales Team. The purpose of this proposal is the new compensation plan for our sales team. The new compensation plan should be such that it benefits the company and the employees. “Compensation includes both financial and non financial rewards. Financial rewards include direct payments plus indirect payments in the form of employee benefits.
Nonfinancial rewards include everything in work environment that enhances a worker’s sense of self respect and esteem by others, opportunities for training and personal development, effective supervision. ”(Cascio, p- 418) . The compensation should be sufficient enough to satisfy basic needs of the employees. Employee equity is very important in terms of internal, external and individual equity. Employee equity is important to enhance optimum performance. We have merged with EnviroTech and their employee profiles shows that every outside sales representative was given a base pay and they were eligible for sales bonus program as well.
The sales representatives of InterClean were just paid straight commission. I believe that outside sales representatives of both the companies have different attitudes towards their work. We have a team consisting of employees from both the companies. “Jim martin who is the vice president of sales” (employee profile) deserves the best compensation which is comparable to the industry standards. He is the backbone of the sales team. He is the one who will motivate the team to do their best. Our “sales manager Tom Gonzalez” (employee profile) has been selected from EnviroTech.
We have to make sure that his compensation is more than what he used to get in EnviroTech. He is innovative, highly experienced and customer focused. We need to retain such employees to proceed successfully after this merger. The team of our outside sales representatives is very efficient. We should provide every sales representative with the base pay and sales bonus at the end of the year instead of paying them straight commission. If we don’t provide a base pay we may not be able to retain some of the most experienced and efficient employees.
Along with base commission we can also give them spot bonus when they give exceptionally good sales results. Another suggestion is team incentives. Team incentives can encourage the team to work together as a whole to get better results. This pay system will work because the demand of time is to retain the best workforce. We will have to change the old pay structure to get good results. The team of sales representatives is very competent and experienced. They are capable to find a job anywhere in the market. We are providing end of the year sales bonus.
In a few months we can predict the projections of the results of our sales team. This is a long term plan which can keep the sales team motivated to be productive. “Long term performance encompasses qualitative progress as well as quantitative accomplishments. ”(Cascio,p-440). The three components of total rewards package that would motivate employees to reach peak performance are security and health which includes health insurance, disability insurance and pension plans. The second component is the payments for time not worked due to reasons which includes sick days, vacations, holidays and grievances.
The third component is the employee services which include tuition aid, career clothing, child care, short term savings plans, wellness programs and flexible work arrangements. I believe that if we balance these three components we can achieve exceptional results. The proposed compensation plan will help in a better quality of life for the individuals. They will have a sense of security while working in our organization. They will be able to give better results. The employees will be stress free and will focus on their jobs more effectively. The organization will definitely be benefitted.
The best thing will be the retention of efficient workforce for our organization. Healthy and happy employees are certainly more productive for the company. The most important thing is to balance the costs in such a way which is affordable by the company. If the perfect balance is sought the employees and the company will be benefitted. References: Cascio, W. F. (2006). Managing Human Resources: Productivity, Quality of Life, profits (7th Ed) New York Mc Graw Hill. University of Phoenix . Employee Profile. Retrieved from University of Phoenix, HRM/531 Human Capital Management website.