Nowadays, to stay competitive, corporations feel a need to upgrade the existing business strategies continuously, thus self-adjusting to the market environment. The companies, to stand out and accustom to the market shifts, tend to transform and adapt in every field of their expertise. In modern strict business surrounding, executives face numerous challenges in organizational activity, having managers dealing with workers’ motivation. The studies showed the considerable aspect of employee encouragement is the financial reward and several benefits the employer can offer. Meanwhile, the effect of the compensation and benefits remain the major topic of scholar discussion, as, although the non-financial leverages affect the loyalty and productivity even more, their implementation can sufficiently result in the employees’ retention.
Actual Compensation Challenges
Globalization touches on various aspects of a business and thus drives major organizational changes. In the case of employee relations, the companies, due to global processes, are becoming rather providers of goods for the subordinates, who, as customers, may choose another job supplier anytime. In such a situation, compensation and benefits management plays a crucial role in deterring subordinates from switching the workplaces. According to the study, retention of talented employees is modern corporations’ major concern, and the managing seniors are developing strategies of employees’ improvement and recruiting experts to ensure long-term resource advantage (Oladapo 20). The study’s findings are that, along with supportive surrounding and possibility to combine professional and private life, the decisive retaining measure is providing decent compensation and benefits for the employees (Oladapo 22). Moreover, the issue of financial inequity becomes urgent, as the wages can be easily monitored by employees, who can compare the compensations in the labor market and leave the job for better prospects (Oladapo 23). Considering the broad perspective, the companies face the challenge of employee turnovers, partially provoked by compensation and benefits dissatisfactory.
Compensation Improvement Strategies
As with any other field of a corporation’s activity, the labor management, including that of employees’ compensations regulation, should define the strategies for implementing changes. The studies on the matter provide substantial resolutions on how to improve the compensation procedures so that the top talents and valuable employees remain devoted to their employer. One research states that the retaining issue is solved by common efforts of HR, compensation, and benefits specialists (Oladapo 23). Among the compensation professionals’ tools, there is market equity analysis, enrolling incentive pays and several bonuses, and providing stock options for the workers (Oladapo 23). Another study also sought for compensation improvement strategies and formed several areas of precise attention. These are compensation structure, procedures, types, and fairness and equity (Bryant and Allen 171). For example, within the structure, dispersion between the highest and the lowest wages results in turnover rate of both managers and employees; the procedures and the sense of compensation equity can build a supportive image of the company; the types imply certain differentiation of payments and bonuses, including providing stocks to the workers (Bryant and Allen 171). The areas of upgrading the compensation system provide a variety of alternative actions, but the changes should be thorough, as they can lead either to employees’ loyalty, or the turnover.
Benefits Improvement Strategies
Along with the compensation, the appealing system of benefits can also encourage subordinates to stay in the firm. The various benefits provided by employers are health or life insurance, retirement packages, or paid vacations. When searching for new solutions, benefits professionals refer to flexible plans that combine both long- and short-term to keep the employees both secured and motivated (Oladapo 23). The study (Bryant and Allen 171) demonstrates that long-term benefits, such as employee stock ownership plans and retirement packages can positively result in the workers’ attitude towards their workplace. The benefits create employees’ sense of organizational support, as they provide a sustainable security guaranty, while financial rewards are rather tactical motives.
Other Factors of Employees’ Loyalty
Despite the fact that financial motivation is a considerable argument of the subordinates’ turnover decision, compensation and benefits are not the only motives that the workers consider, and are not the major. One study questions the priority of monetary motivation over other aspects, referring to professional growth opportunities and providing valuable input for the society (Scitus Academics LLC 350). Other studies, despite the compensation analysis, state that the top talent retention strategy based on wage improvement are inferior and need to be complemented by other structural changes (Bryant and Allen 171), (Oladapo 19). The researches imply the usage of talent management (Oladapo 19) and motives that increase employees’ sense of fairness, value, and support instead (Bryant and Allen 171). Considering the facts above, HR and management professionals should search for options to satisfy the monetary demands of their subordinates but, at the same time, conduct a complex strategic planning that covers not only employees’ compensation but also their non-financial needs.
Conclusion
Summarizing, modern processes in a business environment result in strict competition and dictate that the corporations’ seek for ways of differentiating, also when dealing with the employees. The retention of the talented and valued personnel is an urgent topic of companies’ activity, as the competition affects staff turnovers for better monetary rewards and job prospects. Thus, the main ways of compensation and benefits improvement are structural, procedural changes, upgrades in types and equity of the payments, providing long-term motivators via beneficial package. As the experience demonstrates, the compensation strategy, when isolated from other aspects of the workforce’s motivation, can be insufficient, or even malicious concerning the turnover rates. The expert managers need to form a composite strategy that covers financial, social, and professional motivation, as it can result in an ultimate competitive change.
Works Cited
Bryant, Phil, and David Allen. “Compensation, Benefits and Employee Turnover HR Strategies for Retaining Top Talent.” Compensation & Benefits Review, vol. 45, no. 3, 2013, pp. 171–175.
Horwitz, Frank, editor. Handbook of Human Resource Management in Emerging Markets. SCITUS ACADEMICS LLC, 2018.
Oladapo, Victor. “The Impact of Talent Management on Retention.” Journal of Business Studies Quarterly, vol. 5, no. 3, 2014, pp. 19-36.