Direct Compensation vs. Benefits

Maslow’s Hierarchy of needs was introduced in the mid-1940’s by Abraham Maslow; it is one of the most popular theories of work motivation to this day. the theory was originally used specifically in a psychological setting, but was made more popular by Douglas McGregor in the late 1960’s and began to be used by not only psychologists but managers as well (Steers & Porter, 1983). The hierarchy is based on the fact that human beings have needs, Maslow took these needs and separated them into five categories: physiological needs, safety, belongingness or social needs,

Frederick Taylor’s fundamental thoughts on scientific management dated back to early 1880s when he was employed at Midvale Steel Company and observed his coworkers “soldiering” at work. In the following two decades, he moved around different companies while developing his management theory

This report examines 3 different compensation systems that our company can develop and enforce within our company for our employees. Compensation is the most important and rewarding factor for employees, so a thorough and thoughtful approach should be taken as we think about changing the way in which this company rewards it's employees for the work they do for us each and every day.

Compensation refers to the payment or award given to an employee for the value of their work during employment. Compensation is awarded in many forms, direct or indirectly are a great example. It can be used as a strategic tool to either motivate and empower employees or be used as a bargaining tool by employees when deciding where they will apply their skills and knowledge.

Pay and reward systems exist in the form of pay, bonuses and benefits, financial and non-financial and designed to improve performance, increase motivation, staff retention and increase profitability. Appreciation and gratitude is widely received as reward and the opportunity for training and development for career progression.

Scientific management or "Taylorism" is an approach to job design, developed by Frederick Taylor (1856-1915) during the Second World War. With the industrial revolution came a fast growing pool of people, seeking jobs, that required a new approach of management. Scientific management was the first management theory, applied internationally. It believes in the rational use of resources for utmost output, hence motivating workers to earn more money. Taylor believed that the incompetence of managers was the major obstacle on the way of productivity increase of human labour. Consequently, this idea led to the need of change of management principles. On the base of research, involving analysing controlled experiments under various working

The intent of this assignment is to develop a user-friendly tool that may be applied in the workplace to document Compensation processes and to guide a practitioner in completing the critical steps of each process. The purpose of this assignment is to assist in describing each component of a compensation management system, to develop a practitioner's guide for several of the key compensation management tasks covered in HR511 Total Rewards.

A well-articulated compensation philosophy drives organizational success by aligning pay and other rewards with business strategy. It provides the foundation for plan design and administration and anchors current and future plans to the company's culture and values (Kaplan, 2006, p.32). Recognizing and rewarding achievement is the cornerstone of the company A’s compensation philosophy. The mission of the company is to attract, select, place and promote all individuals based on their qualifications. The company believes that performance-based compensation helps attract, develop and retain talented professionals. In addition to base pay which based upon local market conditions and targeted to be above market, the company provides the following types of potential compensation to reward performance:

Frederick W. Taylor was ahead of his time for his concept of Scientific management. It was a revolutionary way of running a business, that swept all over the globe, and his ideas were applicable to many different industries. Substituting disorder and conflict for a new untested method of control, cooperation, and science. Taylor understood there were no incentives for working harder. Knowing this, he payed workers based on output, allowing workers to make more money on any given day. It seemed like everyone would enjoy and prosper under this system, but that was not the case. Workers liked the opportunity to make more money in this system but many of them resisted this new idea. Being under constant supervision made work much harder for them.

These theories were proven relevant by their popularity (Brooks, 20) “Taylor’s thinking preceded the widespread adoption of mass production techniques, possibly best demonstrated by the early 1920’s motor manufacturers, most significantly Henry Ford in the USA.” Production lines were sequential and followed a strict rule of the “one best way” which may be because the new industry and workers did not have a large amount of knowledge or expertise on how their jobs should be done.

He believed that these employees were easily replaceable for less pay. These kinds of procedures and ideas created an environment that was ripe for alienation. In an attempt to satisfy workers, “In return for a workers lost dignity, freedom, power and skill, Taylor promised higher pay” (Hoopes 48). Taylor also created the “differential piece rate” (Hoopes 38) which would further alienate workers from each other, claiming it improved production. Overall, Taylor’s theory of scientific management created a good environment for business owners but it only fueled alienation between the workers and the workers and society.

Scientific Management Theory by Frederick W. Taylor – Throughout the industrial world employees are the large part of the organisation and Fundamental interests of employees are necessarily aggressive. So as a manager it is necessary to arrange mutual relations with employees so their interests become identical. In case of any single individual the greatest prosperity can exist only when that individual has reached his highest state of efficiency and that is, when he is turning out his largest daily output (Frederick Winslow Taylor, 2007).

Taylor imagined that workers would be able to make out the relationship between completion of more work in units and the economic rewards been increased. Taylors work as described by (Buchanan and Huczynski, 2004) depicts how theories were to take place at shop floor levels, then how facts were substituted for opinion and guess work. Henri Fayol, his fellow classical writer had a different perception which looked at organisation from top to bottom. The pace setters of classical theories had engineering background hence derived theories with scientific approach. (Buchanan and Huczunski, 2004). (Cole, 2004) talks about how the production environment under the classical theory in America had created difficulties, where labour force were skint, uneducated, and in quest of making economic fortunes. (Lemak, 2004) point out how the classical management has had

Taylor's own name for his approach was scientific management. This sort of task-oriented optimization of work tasks is nearly ubiquitous today in industry, and has made most industrial work menial, repetitive, tedious and depressing; this can be noted, for instance, in assembly lines and fast-food restaurants. Ford's arguments began from his observation that, in general, workers forced to perform repetitive tasks work at the slowest rate that goes unpunished. This slow rate of work (which he called "soldiering", but might nowadays be termed by those in charge as "loafing" or "malingering" or by those on the assembly line as "getting through the day"), he opined, was based on the observation that, when paid the same amount, workers will tend to do the amount of work the slowest among them does: this reflects the idea that workers have a vested interest in their own well-being, and do not benefit from working above the defined rate of work when it will not increase their compensation. He therefore proposed that the work practice that had been developed in most work environments was crafted, intentionally or unintentionally, to be very inefficient in its execution. From this he posited that there was one best method for performing a particular task, and that if it were taught to workers, their productivity would go up.

A.H. Maslow, a famous social scientist, has given a framework that helps to explain the strength of certain needs. According to him, there seems to a hierarchy into which human needs are arranged as shown in Figure.