THE UNDERLYING ISSUE BEHIND RUSSIA’S PREVAILING COMPENSATION SYSTEM: AN ANALYSIS OF THE CURRENT RUSSIAN COMPENSATION SYSTEM
A Term Paper Presented to the Faculty of European University In Partial Fulfillment of The Requirements for Human Resource Management
By: Osanna Nazaretyan 14 March 2011
Promoter: Prof. Tina Huesing
THE UNDERLYING ISSUE BEHIND RUSSIA’S PREVAILING COMPENSATION SYSTEM
Table of contents
Abstract Introduction Which are the major challenges in the prevailing compensation system in the Russian Tourism industry? The Theories of Motivation Herzberg’s Two Factor Theory Expectancy Theory by Victor Vroom Conclusions – Recommendations References 5 6 6 8 11 13 3 4
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(This is coming as a bi-product of long communist political setup in the country) (Berger O. Nancy, 2000).
Nazaretyan Osanna, EU Munich, HRM
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THE UNDERLYING ISSUE BEHIND RUSSIA’S PREVAILING COMPENSATION SYSTEM
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Performance and Membership Pay: Will the compensation
emphasize in the performance or in the membership one has with the company? Unfortunately, in the Russian Tourism industry it is more dependent on the membership with the company than the actual performance of individuals (Puffer and Shekshnia, 1997). 3) Job and Individual Pay: Is the pay dependent on the quality and quantity of job an employee is doing, or on the skill set the employee has, that he brings along with him to the company? According to my experience, in Tourism industry the pay is based on the performance of an employee, not on the skills. 4) Open and Secret Pay: Will the employees have access to information about other workers compensation levels and how are compensation decisions been made (open), or will this stay hidden from the employees (secret). As being confirmed from my colleagues - in the Russian Tourism industry a mix of both, open as well as secret pay system, is practiced.
Which are the major challenges in the prevailing compensation system in the Russian
Gómez-Mejía, L. R., Balkin, D. B., & Cardy, R. L. (2016). Managing human resources (7th ed.). Harlow: Pearson.
The Russian state has been characterized by its strong heritage of powerful, autocratic leadership. This domination by small ruling elite has been seen throughout Russia's history and has transferred into its economic history. Throughout the Russian czarist period, to the legacy of seventy years of communism; Russia has been a country marked by strong central state planning, a strict command economy and an overall weak market infrastructure (Goldman, 2003). Self-interest, manipulation and corruption have all been present in the Russian economy, and have greatly helped the few as opposed to the many. To this day, Russia still struggles with creating a competitive and fair market.
Boxall, P and Purcell, J (2011), The Goals of Human Resource Management, Strategy and Human Resource Management, 3rd Edition, Palgrave Macmillan, New York, pp. 1-36.
2. Leatherbarrow, C., Fletcher, J. & Currie, D. (2010) Introduction to Human Resource Management. 2nd Edition. London: CIPD
Gerhart, B., Hollenbeck, J., Noe, R., & Wright, P. (2009). Fundamentals of human resource management (3rd ed.). New York, NY: McGraw-Hill.
Oligarchy as it is known in Aristotle’s politics; is a government run by a small group of people, ‘elites’. However, the oligarchy which this essay addresses is currently referred to in Russia as “a very wealthy and politically well-connected businessman...one who is the main owner of a conglomerate of enterprises and has close ties with the president” (Aslund and Dabrowski, 2007; 144). In the 1990s Russia’s economic reforms are said to have created the rise of a small group of oligarchs who gained an overwhelming amount of power and control. By 1997, this small group of previously unknown businessmen and bankers, often with gangster ties, had acquired control of many of the key parts of the Russian economy. Why did they emerge? It is argued by David Satter that three processes facilitated the emergence of the oligarchs. The first was hyperinflation and the social, economic and political consequences. The second was the process of privatisation, and finally the third was criminalisation (Satter, 2003). However, were these powerful oligarchs just a phase during the transition from Soviet to Post-Soviet Russia? Even with Putin’s efforts and declaration to distance the oligarchs from politics and power, and start a war against them exemplified by the Khodorkovsky affair, are oligarchs still significantly powerful in contemporary Russia? What is the role they play in Russia? It seems that the power of those original oligarchs of the 1990s has decreased or been concealed in
The economic environment in nowadays dynamic, it is fairly important for organisations and managers to recognise the curtail of Human Resource Management. It is clear that Human Resource Management (HRM) has become one of the most recommend management strategy in the modern business (Leopold and Harris, 2009). Human Resource Management is a technique process of managing people in the workplace to enable and enhance organization performance (Leopold and Harris, 2009). This theory involved the responsible to attracting, selecting, training and managing people which make employees become more valuable to the organisations. It invests effect in learning and development at work. Also to communicate with all employees at each level to reward successful employee relations (Wilton, 2011). Human Resource Management plays a very important role in the operation strategy and management concerns in work organisations of all kinds (Leopold and Harris, 2009). In aim to justify this statement by evaluate the benefit and importance of Human Resource Management in contemporary work organisations. This essay will focus on analysis the advantages of use Human Resource Management in business also underline by explain more detail about the different HRM strategy brings benefits and give competitive advantages impact to the organisation success. Then summarise by a general conclusion on the importance of HRM in contemporary work organisations.
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The main objective of the company is not only to attract but also to retain staff who are interested to work in the hotel business for the five-star level of high service, taking into account the wishes of clients, and which offers an innovative, dynamic environment and reflects the culture of the local country. To achieve this, Hyatt strives to be a company listening to well-informed and concerned people. Hyatt provides plenty of opportunities at all levels for their employees, which are accompanied by numerous development
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Alexander, M., 2003. A handbook of Human Resource Management Practice. 9th ed. London: Kogan Page
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