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Compen-7

1. Can you explain what the strategies external competitiveness of


condensation strategy?
2. What meaning of labor market factors to establish or decide competitive
compensation?
3. Why the companies when to decide compensation managers determine
product market factors and ability to pay?
4. What consequences of pay level and mix decision in compensation
competition?
Answer
1. External competitiveness refers to pay relationships among organizations - an
organizations pay relative to its competitors. Pay level refers to the average of
the array of rates paid by an employer: (base + bonuses + benefits + value of
stocks) / number of employees. Pay forms are the various types of payments, or
pay mix, that make up total compensation.
2. -Employers always seek to maximize profits
-People are homogeneous and therefore interchangeable
-Pay rates reflect all costs associated with employment
-Markets faced by employers are competitive
3. The company has ability to pay the compensation depend on the condition of
the company. Whether the company could earn much money or not. If the
company is in a good condition, of course, the workers can get more
compensation. and it also show that the company can doing good marketing to
sell their products.
4. -Efficiency
-Fairness
-Compliance