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Pay People Right Zingheim & Shuster

Chapter 6 explores the crucial elements of establishing a robust infrastructure for base pay within organizations. It addresses market value determination, benchmarking techniques, and the vital role of surveying to align roles and jobs accurately. Key concepts discussed include job grades, ranges, and broad bands, with an emphasis on adapting to rapid changes in the labor market. The chapter highlights the importance of organizational flexibility, the "one-company" identity, and the necessity of effective budget management for merit pay decisions, ensuring a sustainable and fair compensation strategy.

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Pay People Right Zingheim & Shuster

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  1. Pay People RightZingheim & Shuster Chapter 6 Building Infrastructure for Base Pay

  2. Determining Market Value • Benchmarking • Survey Matches • Slotting Roles and Jobs • Practical Application

  3. Structure for Base Pay • Job Grades • Ranges • Broad Bands • Career Bands

  4. Reasons for Banding • Accommodating/symbolizing rapid change • Supporting “one-company” identity • Delegating pay decisions • Organizational flexibility/flatness • Encouraging development and learning • Emphasizing the person over the job • Internal org mobility • Work design change

  5. The Labor Market and Banding • Role Clusters

  6. The Labor Market and Banding • Job Clusters in Bands

  7. Managing Pay Budgets • In bands, managers have more discretion • Managers allocated pool of funds from which to make merit pay decisions/awards • Budget based on: • CPI • Business results • Market conditions/data

  8. Successful Implementation • Depends on: • Communication • Real potential pay growth • Effective use of titling, promotional opportunity, transfers • Appropriate budgeting

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