Corporate Fairness And External Competitiveness At Gore 's Compensation Plan

Decent Essays

As the company ranked fifth on Fortune’s list “100 Best Companies to Work For” in 2006, W.L. Gore & Associates (Gore) uses innovation and team approach to encourage workforce from the top to the bottom. This helps the company being in a row in this list in the eighth year (Lepak & Gowan, 2010). Especially the Gore’s compensation plan, it divides into two practices: internal fairness and external competitiveness. These two practices help to enhance internal workforce and increase competitive advantages in the industry. Compensation Practices at Gore For Gore’s compensation plan, there are two objectives: increase internal fairness and external competitiveness. Gore uses job ranking for internal fairness. According to Lepak & Gowan (2010), job ranking is a type of job evaluation which involves reviewing job descriptions and listing the jobs from highest to lowest in worth to the company. For increasing external competitiveness, Gore uses job pricing to review employees’ salaries on comparable jobs from other companies in the same industry. In Lepak & Gowan (2010), it defines job pricing is the systematic process of assigning monetary rates to jobs so that a firm’s internal wages are aligned with the external wages in the marketplace. Pros of Job Ranking and Job Pricing Job ranking approach is the easiest and fastest way to identify good performers and poor performers in the company. By eliminating the poor performers and promoting or rewarding good performers, it can improve

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