INSEAD Library

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Compensation management in a knowledge based world Preface xi PART I: MACROECONOMIC COMPENSATION CONCEPTS CHAPTER 1 Compensation in a Knowledge-Based Global Economy 3 Capitalism and Knowledge in a Global Economy 4 Compensation and Organizational Strategy 5 Integrating Knowledge and Skill Requirements, Organization Compensation, and Employee Income 6 Lifestyle and Compensation 6 Pay and Social Class 7 Summary 15 Review Questions 15 CHAPTER 2 The Reward System: Compensation and Noncompensation Dimensions 16 The Reward System 17 17 Compensation System Compensation Dimensions 19 Noncompensation System 23 Summary 27 Review Questions 27 CHAPTER 3 The World of Pay and Compensation The Compensation Program 28 Determining Rates of Pay 30 Jobs and Pay in the United States A World in Transition 43 Summary 43 Review Questions 44 Appendix 3A: Economic Theories 28 37 44 CHAPTER 4 Organizational Structure: Strategic and Tactical 57 Compensation Issues Development of an Organization 58 Employees-A Critical Resource 61 Division of Labor 62 Creating an Organizational Hierarchy Board of Directors 66 Senior Management 68 Operating Managers 72 Sales Personnel 73 Professionals 76 Operative Employees 78 Pay Relationships: A Fairness Issue Summary 91 Review Questions 91 CHAPTER 5 Legislation and Compensation 92 The Legislative Process 94 Wage and Hour Legislation 95 Employee Pension and Welfare (Benefits) Legislation Tax Treatment Legislation 109 114 Antidiscrimination in Employment Legislation Wage and Price Control Legislation 123 Legislation Affecting Public Employees 124 Summary 125 Review Questions 126 101 PART 1 : MICROECONOMIC COMPENSATION CONCEPTS 1 CHAPTER 6 Job Analysis 129 Preliminary Considerations 131 131 Planning a Job Analysis Program Gaining Employee Acceptance and Cooperation 139 Collecting and Describing Job Data 140 Reviewing and Revising Job Facts 155 Designing a Custom-Made Job Analysis Questionnaire 155 158 Guidelines for Conducting a Job Analysis lnterview Other Job Analysis Methodologies 159 Summary 160 Review Questions 160 Appendix 6A: Other Job Analysis Methodologies 161 CHAPTER 7 Job Description 168 Broad, Generic Job (Class) Descriptions versus Narrow, Specific Job (Position) Descriptions 170 A Job Contract 170 Planning, Operations, and Control 171 Elements of the Job Description 174 Other Kinds of Information Used in Describing Jobs 190 Other Ways of Describing Job Facts 193 Revising Job Descriptions 196 Using the Computer 198 Summary 203 Review Questions 204 CHAPTER 8 Job Evaluation 205 Job Requirements and Pay 206 Job Evaluation Issues 207 The Intraoccupational and Interoccupational Method of Job Classification 208 Whole Job Ranking 2 10 Position (Job) Classification-Predetermined Grading Approach A Market Pricing Approach 214 The Maturity Curve Method 216 The Development and Use of Compensable Factors 217 Weighting and Rating of Compensable Factors 230 Job Evaluation and Comparable Worth 236 Summary 240 Review Questions 241 Appendix 8A: Paired-Comparison Procedures 241 Appendix 8B: Other Job Evaluation Methods 244 Appendix 8C: Using Multiple Regression Analysis in Questionnaire-Based Job Evaluation 251 211 CHAPTER 9 Job Evaluation: Two Point-Factor Methods Combining Point-Factor and Factor-Comparison Methods Job Evaluation Committee 258 Using FES to Determine Job Worth 263 Using the Hay Plan to Determine Job Worth 284 257 256 Comparing FES and Hay Summary 302 Review Questions 302 299 CHAPTER 10 Surveying Market Pay and Compensation Practices Critical Pay Survey Problems 305 Determining the Need for a Survey 308 Preparing for the Survey 312 Identifying Survey Methods 317 Designing the Survey 327 Performing a Statistical Analysis of the Data Using Third-Party Surveys 337 Sources of Third-Party Data 338 Summary 342 Review Questions 343 304 333 CHAPTER 11 Designing a Base Pay Structure 344 Pay Structure Architecture 345 Interlocking Multiple Pay Structures 370 The Expanding or Fan-Type Pay Structure: An Optional Approach 371 Architectural Design Hints 375 Pay Sectors and Levels of Education, Experience, and Training 376 Spreadsheet Software 377 Summary 377 Review Questions 378 Appendix 11A:The Least-Squares Method for Determining Line of Best Fit (Trend Line) 379 CHAPTER 12 Team-Based Pay in a Knowledge-Based World Kinds of Teams 383 Use of Skill-, Knowledge-, and Competency-Based Pay Summary 404 Review Questions 404 References 404 388 382 PART 1 1 MICRO- AND MACROECONOMIC COMPENSATION CONCEPTS 1: CHAPTER 13 Measuring and Paying for Performance 407 408 Pay for Performance in a Knowledge-Oriented, Service-Sector Economy Application of Motivation Theories 409 Merit Pay 418 Performance Appraisal: Issues and Opportunities 420 427 Performance Appraisal: A Cost-Effectiveness Analysis Designing a Job Content-Based Performance Appraisal Program 429 Other Critical Performance Appraisal-Related Issues 435 Summary 440 Review Questions 441 Appendix 13A: Ranking and Rating Instruments and Formats 441 Appendix 13B:Validity and Reliability 443 CHAPTER 14 Short-Term Incentives 446 Premiums and Differentials 447 Pay for Units Produced 451 Individual-Based Bonuses and Awards 452 Aggregating Employees for Incentive Opportunities 458 Organizationwide Short-Term Incentives 462 Summary 473 Review Questions 473 Appendix 14A: Setting Standards and Designing Incentives 474 for an Tndustrial Economy Appendix 14B:Two Other Kinds of Gainsharing Plans 479 CHAPTER 15 Long-Term Incentives and Wealth Building 483 Wealth and Work in the United States 484 Tax Legislation 485 Designing a Long-Term Incentive and Deferred Compensation Plan Qualified Deferred Compensation Arrangements 489 Summary 502 Review Questions 502 486 CHAPTER 16 Executive and International Compensation Executive Compensation 504 Capital Accumulation 511 Maximizing Executive Compensation Opportunities 514 International Compensation 519 Summary 523 Review Questions 524 524 Appendix 16A:Tax Legislation-Related Terms 503 Appendix 16B: Stock and Stock Equivalent Acquisition Plans Appendix 16C: Special Corporate Insurance Programs 538 530 CHAPTER 17 Benefits and Services 541 Benefits Administration 546 Employee Benefits 548 Employee Services 572 Funding Benefits Through a VEBA 583 Costing Benefits 584 Flexible CompensationIBenefits Plan (Cafeteria Plans) Summary 595 Review Questions 596 585 CHAPTER 18 Pay Delivery Administration Tying It All Together 598 The Budget Process 600 Administration of Pay 602 Quality of Work Life and Pay Administration Other Compensation Administration Tssues Due Process 633 Summary 637 Review Questions 638 597 624 626 Action Words Glossary of Terms 639 649 669 Compensation Administration 649 Employee Welfare and Pension Benefits Legislative-Related Terms 674 Name Index Subject Index 677 679