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Term Paper

On
Compensation condition of
Junior Executive Ofcers of
Bangladesh
Course Title: Compensation Management
Course Code: HRM 412
ection: 1
Prepared for:
Mr. SSM Sadrul Huda
Assistant Professor
Department of Business Administration
East West ni!ersit"
Prepared B!:
"ame #$
Samsul Hu#
Siddi#ue
2$$%&1&1$&$12
Md. Samsuddin
'(an
2$$)&1&1$&$11
A.S.M. *ousuf 2$$+&1&1$&$%2
Raisul ,slam 2$$+&1&1$&$14
-o.sif Ma(di 2$$+&1&1$&$2%
$ate of u%mission: 2/0%02$12
&etter of 'pproval
1ul" 1%2 2$12
Mr. SSM Sadrul Huda
Assistant Professor
Department of Business Administration
East West ni!ersit"
D(a'a
Su34e5t6 Su3mission of t(e term paper on 7Compensati on 5onditi on of
1unior E8e5uti!e 9:5ers of Banglades(
Dear Sir6
,n t(e response of "our ad!i5e to our group to ma'e a report on
7Compensati on 5onditi on of 1unior E8e5uti!e 9:5ers of
Banglades( under t(e 5ourse HRM4122 .e (a!e done t(e tas' .it( t(e (elp of
di;erent referen5es2 primar" and se5ondar" data and 5on5eptual 'no.ledge.
We (a!e follo.ed standard met(odologi5al formation to ma'e all our <ndings and
e8amined all t(e referen5es to 3ring t(e e8a5t output .(ile preparing t(is term
paper. We (a!e also done a sur!e" and inputted t(ose data on Mi5rosoft E85el.
,t .ill 3e a great pri!ilege for us if "ou 'indl" spend some of "our !alua3le time
(a!ing seen t(e full paper and gi!e "our !alua3le opinion.
Sin5erel" "ours2
Samsul Hu# Siddi#ue Md.Samsuddin '(an A.S.M.
*ousuf
=2$$%&1&1$&$12> 2$$)&1&1$&$11
2$$+&1&1$&$%2
Raisul ,slam -o.sif Ma(di
2$$+&1&1$&$14 2$$+&1&1$&$2%
Ta%le of Content

E?EC-,@E SMMAR*
1.$ ,ntrodu5tion
9rigin
934e5ti!es
S5ope
Aimitations
Met(odolog"
2.$ Cas( 5ompensation
Base
Merit pa"
,n5enti!es
Bene<ts
Relational return
B.$ Results and Cindings
Ca5tor anal"sis
Des5ripti!e statisti5s and 5orrelation
4.$ Con5lusion

EXECUTIVE SUMMERY
These days it is all about attitude and presenting oneself in front of others in a different and
distinct manner. This intention to make a statement of ones own has modified the job selection
and compensation pattern of people in the first paced societies of Bangladesh. This change of
compensation pattern has presented many opportunities for the management who can modify
their offerings. Compensation is more performance-based now, rather than outcome-based. As it
has been the trend for the last fie to si! years, it has also affected the compensation pattern of
the "unior #!ecutie post of Bangladeshi organi$ations.
Compensation %anagement is a ery complicated process. #ach of the indiiduals, groups and
organi$ations hae their own instinct &ualities for choosing 'eople, serices, ideas, or
e!periences. (t had neer been so simple to ealuate "ob description and proide them their
desired Compensation. An employee minds are changing along with the time is moing. (t is not
possible to influence their minds so easily.
'eople cannot do their job without any compensation. )o, eeryone needs compensation for
doing the job. (n the case of choosing job people influence mostly by the compensation. (n the
current economic condition, A "unior #!ecutie will change his job and company, if he gets
better compensation from another job. Because the emotional attachment of people. )ome
#!ecuties do not want to change their organi$ation een if other organi$ation offers them better
compensation.
The "ob market is ery much competitie and the "unior #!ecutie post is ery attractie mostly
to the fresh graduates because this post can be used as the first step to build a successful career.
)o, #en though most of the "unior #!ecuties are not happy with the compensation but they are
happy to get a job in this difficult economic condition.
1.0 INTRODUCTION
1.1 Origin:
)tudents of *epartment of Business Administration need to do some practical courses where
+,%-./ is one of them. +ere the factors influencing the buyers decision is the main objectie to
learn.
This report has been prepared to gain a practical knowledge about Compensation %anagement. (t
is undertaken as a realistic re&uirement for the 0Compensation %anagement1 2+,%-./3 course
of Business Administration program. The report is about the 0compensation condition of "unior
#!ecutie 4fficers of Bangladesh.1 4ur report is a comprehensie study that wraps all important
features of compensation strategy of Compensation %anagement And our fie-member group
has prepared the report in accordance with the instructions of our course instructor, %r. ))%
)adrul +uda, Assistant 'rofessor, *epartment of Business Administration, #ast 5est 6niersity.
1.2 Objectives:
r!"# !bjective
4ur broad objectie is to gather knowledge about the current compensation condition of "unior
#!ecutie officers in Bangladesh. 7or this reason we went to eery possible place to obtain the
objectie.
S$eci%ic Objectives
To attain the broad objectie following specific objecties were pursued8
To know briefly about the Compensation strategy of different organi$ation.
To identify the e!ternal influences on the compensation strategy.
To find the internal influence that affects the compensation strategy.
To find out the current compensation position of junior e!ecutie officers in the
market.
To suggest better, effectie compensation strategy for "unior #!ecutie officers.
To know different indiiduals how they make a job changing decision.
1.& Sc!$e:
To analy$e the current compensation condition of Bangladeshi "unior #!ecutie 4fficers 5e
hae completed the surey and made this report. (t is a comprehensie report based on
&uestionnaire surey, data calculation, spread sheet analysis, peoples perception, and opinion.
7rom this analysis, we will be able to know the different theory they hae used, the effectie
outcomes of those theory and the recommendation for further processing.
1.' (i)it"ti!ns:
*ata accessibility is one of the concerns for this report.
(nformation and data regarding company is ery much confidential.
9ack of knowledge of people whom we did surey.
The &uestionnaire pattern was not understood by many #mployees. )o, they did not
respond properly.
*ata collection process was irregular.
4ur preailing knowledge is not well enough to articulate the information.
'roision of less time is also a major factor.
1.* Met+!#!,!g-:
S!.rce !% in%!r)"ti!n:
The data we hae presented in the term paper collected from arious sources are mentioned
below8
D"t" S!.rce: The source was collected through the surey. 5e diided our group
into some parts and send them in arious places to surey. 5e collected information by doing
face to face conersation with the "unior #!ecutie 4fficers of different organi$ation.
T"rget /!$.,"ti!n
"unior #!ecutie 4fficer, /: years of age and oer residing in *haka.
S")$,ing Met+!#
This is a sample surey with a conenient sampling which is multistage stratified and clustered
area sample of the junior e!ecutie officers.
D"t" S!.rces
*ata collection for this reference period8 "uly, /;./. ,esponding to this surey is oluntary. *ata
are collected directly through structured &uestionnaire from surey respondents.
Err!r Detecti!n
S")$,ing Err!rs8 The estimates are based on a sample of only /< people. The resulting
sampling errors ary according to a number of factors the most important of which is the si$e of
the estimate.
N!n0s")$,ing Err!rs8 The non-sampling errors range from the respondent misunderstanding
the &uestion to errors introduced during processing. %echanisms to minimi$e these errors are in
place although the final estimates are still affected to some degree.
1n",-sis !% In%!r)"ti!n:
To prepare this report, standard methods, of report writing hae been used. )tatistical tool
through %) #!cel was used to analy$e the collected data. Aerage, weighted aerage were used
here.
/resent"ti!n !% In%!r)"ti!n:
Collected and calculated information is presented in graphical forms. The results of this
information hae been the inention of a database that enables to monitor and e!amine trends.
C"s+ c!)$ens"ti!n : "se
Base wage is the cash compensation that an employer pays for the work performed. Base wage
tends to reflect the alue of the work or skills and generally ignores differences attributable to
indiidual employees.
C"s+ c!)$ens"ti!n : Merit $"-
'eriodic adjustments to base wages may be made on the basis of changes in what other
employers are paying for the same work. %erit increases are gien as increments to the base pay
in recognition of past work behaior.
C"s+ c!)$ens"ti!n : Incentives
(ncenties tie pay increases directly to performance. +oweer (ncrements differ from merit
adjustment. (ncenties do not increase the base wage, and so must be re-earned each pay period.
-otal returns
-otal
Compensation
Relational returns
Cas(
5ompensation
Bene<ts
9ong-Term (ncenties 8
(ncenties may be short or long term. 9ong-term incenties are intended to focus employee
efforts on multiyear result.
ene%its :
A company offers arious benefits to its employees. Benefits include income protection,
work=life balance, and allowances. 7or ma!imum effort of employees a company gies benefits.
Re,"ti!n", Ret.rn:
,elational returns from work as recognition and status, employment security, challenging work,
and opportunities to learn. 4ther relational forms might include personal satisfaction from
successfully facing new challenges.
The 4rgani$ation as a network of ,eturns 8
)ometimes it is useful to think of an organi$ation as a network of returns created by all these
different forms of pay, including total compensation and relational returns. The challenge is to
design this network so that it helps the organi$ation to succeed.
(s the research useful>
+ow useful are the ariables in the study> +ow well are they measured> 'erformance may be
accounting measures such as return on asset or cash flow, financial measures such as earning per
share, operational measures such as scrap rates or detect indicators, or &ualitatie measures such
as customer satisfaction.
*oes the study separate correlation from causation>
4nce we are confident that the ariables are useful and accurately measured. 5e must be sure
that they are actually related. %ost often this is addressed through the use of statistical analysis.
Are there alternatie e!planations>
Consider a hypothetical study that attempts to assess the impact of a performance-based pay
program. The researchers measure performance by assessing &uality, productiity, customer
satisfaction, employee satisfaction, and the facilities performance.
)trategic choices8
4bjecties8
+ow should compensation support the business strategy and be adaptie to the cultural and
regulatory pressures in a global enironment.
(nternal alignment8
Corporate
o34e5ti!es2
Strategi5 plan2
!ision and !alue
Business unit
strategies
Hr strategies
Strategi5
5ompensation
de5isions
Compensation
s"stem
Emplo"ee attitudes
and 3e(a!iors
Competiti!e
ad!antage
So5ial 5ompetiti!e
and regulator"
en!ironment
+ow differently should the different types and leels of skills and work be paid within the
organi$ation>
#!ternal competitieness8
+ow should total compensation be positioned against competitors>
#mployee contribution8
)hould pay increases be based on indiidual and=or team performance, on e!perience and or
continuous learning, on improed skills, on changes in cost of liing, on personal needs.
%anagement8
+ow open and transparent should the pay decisions be to all employees>
Competitie dynamics8
An understanding of the specific industry in which the organi$ation operates and how the
organi$ation plans to compete in that industry.
Culture=?alue8
A pay system reflects the alues that guide an employers behaior and underline its treatment of
employee.

)ocial and political conte!t8
Conte!t refers to a wide range of factors including legal and regulatory re&uirements, cultural
differences, changing workforce demographics, e!pectations, and the like.
#mployee preferences8
The simple fact that employees differ is too easily oerlooked in formulating a compensation
strategy. (ndiidual employees join the organi$ation, make inestment decision, interact with
customers, design new products, assemble components, and so on.
Res.,t "n# 2in#ings:
7actor analysis8
(t is important to test reliability which is a measure of consistency of the data collection.
This helped analy$ing the degree to which the items in each section were congruent with each
other. By considering an alpha @AB alue of ;.: and aboe, inconsistent items in the &uestionnaire
were eliminated and the reliability test was repeated ia factor analysis. Alpha alue more than
;.: is acceptable for further analysis in research. (t is obsered that alpha alue for all ariables
@independent and dependentB was higher than ;.C. Therefore, it was re&uired to run factor
analysis for independent ariables. The reason for such high alue for the other ariable may
hae been due to the consistency in the results for each item, which ranged from neutral @DB to
Agree @-B in most cases. The results of the factor analysis showed that those who are age below
D; are neutral with their pay scale.
*escriptie )tatistics and correlation8
The result showed that satisfaction with pay scale is significantly correlated with age and the
salary range of the employees. +ence, theory . is accepted. The result indicated that employee
satisfaction is correlated with the benefits that the company proided. +ypothesis / is accepted.
The result found that the compensation package of accompany is not market competitie. %ost
of the employees are agreeing with these particulars and also the salary administration of
company is not ary good. %ost of the employees are prefer cash compensation than benefits.
And also agree with the particulars of findings suitable job is difficult in market. 'articular C says
that if better salary is proided employee is ready to sacrifice e!isting company. There are some
employees who are below D; hae the tendency of switching company but aboe D; this kind of
tendency is obsolete. And also employees hae dilemma in receiing salary on time. And
disagree with the concept of joining people for compensation package.
P
a
r
t
i
5
u
l
a
r
s
B
e
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o
.
B
$
B
$
&
4
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o
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B

"
e
a
r
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e

D
2
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2
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$
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&
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Eo of emplo"ee0Weig(t Eo of emplo"ee 0Weig(t Eo of emplo"ee 0Weig(t
, am
(app" .it(
m" pa"
s5ale
% + / 4 / % 4 + D ) %
B 2 4 D B 4 D 1 D 2 B
Bene<ts
option are
satisfa5tor"
/ 4 + % + / % 4 ) 4 %
B 4 2 1 D B 4 2 1 D B
Compensat
ion
pa5'age is
mar'et
5ompetiti!
+ / % 4 % + / 4 / 4 +
4 D B 1 2 D 4 B 1 D B
e
Salar"
admin is
!ar" good
% + / 4 D ) % 4 + / %
4 D 2 B 1 D 2 B 4 2 B
E8press
dissatisfa5t
ion to
superior.
) 4 % D % + / 4 + % 4
D B 1 2 B D 4 1 2 B D
Prefer 5as(
5ompensati
on t(an
3ene<ts
+ / 4 / / 4 + % % + /
D 2 B 1 4 D B 2 1 D B
Cinding
suita3le 4o3
is di:5ult
+ / 4 + ) 4 % D + % 4
D 1 B 4 2 D 1 4 B D 1
Better
salar"
&lea!e
5ompan"
+ / 4 + ) 4 % D + % 4
D 2 B 1 4 D 2 D 2 2 1
Age Duration of .or' Salar" range
P
a
r
t
i
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u
l
a
r
s
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e
l
o
.
B
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&
4
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&
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e
a
r
s
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$
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&
B
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B
$
&
D
$
Weig(t Weig(t Weig(t
Re5ei!e
salar" on
time
4 + % % + / 4 + ) 4 %
B D 2 B 4 1 D B 1 D 2
Re5ommen + % 4 / + / 4 / % + /
d ot(er
people to
4oin
3e5ause of
5ompensati
on pa5'age
B D 2 / B 1 D B 4 2 4
C,F6 Weig(t a55ording to Age2 Duration of Wor' and Salar" range of emplo"ees.
7rom the statistical analysis it is shown that for the junior e!ecutie employee in Bangladesh
basic pay scale is important for them and is not satisfied about benefits option. They are also
disagreeing whether compensation package is market competitie or not. *ata also showed that
negatie impression of salary administration. #!pressing dissatisfaction about compensation is
also showing the negatie e!pression among employees. (n junior e!ecutie leel it is more
important cash compensation than benefits.
They also concern about the findings of suitable jobs in more difficult in present market. And
obiously will leae company if get a better salary option. And hae objection about receiing
salary on time. They are also not agreeing with the concept of recommending other people to join
the company because of the compensation package.
C!nc,.si!n:
(n Bangladesh, "unior #!ecutie post is a ery attractie one for the fresh BBA and %BA
graduate. %ost of the junior e!ecuties those we hae sureyed hae gien negatie answers
about the compensation strategy and oerall condition of the job but at least they are happy to get
a job in this difficult economic condition. Another thing is that these "unior #!ecuties will be
able to show their job e!perience when they will apply for other jobs. This post proides a ery
good opportunity for the e!ecuties to get promotion and job enrichment. After doing the surey
and talking with the e!ecuties we think that the companies should gie much emphasis in this
post to generate job satisfaction of the employees.