M Company's Performance Salary System Optimization Based On Position Value

With the fast growth of economy and the rapid progress in science and technology,ours is a time of fierce competition of survival for enterprises.The competition between enterprises is essentially a competition of talents and the core competence of a company depends largely on its human resources(HR)management level.Compensation management is at the core of HR management.The rationality in the top-level design of salary structure is decisive for compensation incentive as well as for the career development of employees.Undoubtedly,compensation incentive plays a pivotal role in improving the employees' motivation.Company M is a state-owned enterprises in the business of telecommunications.With over 1,000 staff on the payroll,the company faces more and more problems in its salary distribution system,especially in terms of equality in payment.To be specific,with a system that gives priority to seniority rather than contribution,the payment level of employee hinges more on rank and post,and people cannot get equal payment from the same job.The company lacks a scientific set of evaluation tools and criteria to measure the value of different posts and to provide a relatively fixed standard for making salary offers to its employees.Moreover,under the supervision of parent companies,the company has limited authority to decide the setting of ranks and posts,and there is no effective mechanism to transferring staff between lower and higher ranks corresponding to their performance,which has severely impeded the promotion of employees of lower ranks that accounts for 65% of the staff.As result,employees who cannot get progress in rank or rise in payment for a long time have little motivation for work and consequently the dimission rate of the company is on the rise in recent years.Based on compensation management and motivation theories,this study begins with an enumeration of the present status of and problems in the compensation management of Company M,with analysis of the causes of the problems.Then evaluation is given to different posts within the company based on the Hay Group evaluation system.A performance-based compensation system is designed and presented that is in keeping with the current situation of the company.The proposed compensation system is based on post-rank salary system and a post-value-oriented distribution principle.The ultimate goal of the new compensation system is to improve its competitiveness and fairness and to give full play to its role as an incentive to stimulate the employees and accomplish the company's business objectives.