CHAPTER 9

1. Tomax Corporation has 400 employees and wishes to develop a compensation policy to correspond to its dynamic business strategy. The company wishes to employ a highly competitive workforce capable of responding to a competitive business environment. Suggest different compensation objectives to match Tomax’s business goals. 7 points
Compensation program establishment needs to consider specific goals such as employee retention, distribution of compensation, and adherence to a budget. Compensation should reward employees for past and motivate for future performance. In order to motivate employees they need to be rewarded with a keep the employees motivated their compensation scheme needs to be competitive. The objectives to match Tomax’s business goals are:
-attracting new employees through offering a pay package that is considered to value the work
-complying with regulations will be done through adoption of the policy that avoids unnecessary court issues which constrain the money of shareholders
-open and understandable pay practice will be done through creating a positive atmosphere free from demotivation while the policy adapted will be easily understandable and clear for all
-promoting pay for performance standards will be done through creation of a rewarding policy that will motivate employees to go out of their way to pursue organization’s goals.
-achieve internal and external pay balance will be achieved through a pay policy that is in harmony with same sector organizations
-entrenching fair employee treatment will be achieved through the sense of value and belonging that employees have when being offered with benefit and prerequisites.

2. Since employees may differ in terms of their job performance, would it not be more feasible to determine the wage rate for each employee on the basis of his or her relative worth to the organization? Explain. 8 points
Deterninig the wage rate based on the relative worth of the employee to the organization may be diffiqult when it comes to quantifying the contributions from specific workers especially

Value Based Management Explain what your fictitious company must d...