Section 2: External CompetitivenessSection 2 shifts your focus outside of the firm to understand its relationship with the external marketplace. You will use market survey data to compare pay rates of positions inside the firm with those in the marketplace to establish the foundations of market-competitive pay. The analysis of market data also leads you to the determination of appropriate pay-policy mixes for each of its job structures. In this section, you are asked to use CompAnalysis software developed by Howard Weiss at Temple University. In Section 2 of this simulation, you will shift your focus from concentrating on e-sonic?s internal consistency to its external competitiveness. First, you will be introduced to the tools compensation professionals use to allocate total compensation most effectively within job structures.Many employeesare unaware that their total compensation consists of much more than just base pay. Compensation professionals allocate total pay (for example, base pay, benefits, and different types of incentives) to motivate employees in different ways. You will use some of these tools to develop pay policy mixes for each e-sonic job structure. Next, you will consider pay policy level decisions for each job structure.You will then use CompAnalysis (the included software program) to conduct an external market survey. Specific instructions provided with the software program will guide you through the steps involved in the compensation survey exercise. Finally, you will report survey findings, interpreting regression analysis results generated by the software, and provide an explanation of major decisions reached.IMPORTANT:Users of the CompAnalysis software must set the macros to a low level in order for the software to work. If the macros are set on too high of a security level, then the software will be disabled and not work properly. In order to do this, navigate to the “Tools” menu, click “Macros”, then “Security”. Lower the security level, save the spreadsheet, close it completely, and then re-open.Section 2 Outline: Executive Summary Findings1. Determine Appropriate Pay-Policy Mix2. Pay-Policy Level Decisions3. Compensation Surveya) Choose competitors based upon industry, size, and union status.b) Select benchmark jobs for each structure using benchmark job descriptions.c) Reconcile differences using the benchmark job comparison sheet.d) Update salary data for inflation using CPI-U.4. Implementation of Salary Survey Resultsa) Report and interpret results of regression analysis for each job.b) Integrate external and internal structures by creating pay grades and ranges.c) Evaluate and summarize decisions made for each job structure.Requirements of submission: Each section of the final project must follow these formatting guidelines: 5?7 pages, double spacing, 12-point Times New Roman font, one-inch margins, and discipline-appropriate citations.
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CompAnalysis – Software to Support:
Building Strategic Compensation Systems
This software named CompAnalysis accompanies the Building Strategic
Compensation Systems case manual, and it is designed as a tool for
students to analyze pertinent data in two sections of the case.
The External Market Survey feature will be used in Section 2 of the case
manual titled ?Market Competitiveness.? The Merit Pay Planning
feature will be used in Section 3, titled ?Recognition of Individual
You may consult the Software Appendix contained in your casebook
that will illustrate what you will find in the software.
Make your decisions first by following the directions in the casebook
(jot down the pertinent information on paper); then, use the software to
input your choices and analyze the data.
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