Management Compensation - Research Paper Example

Extract of sample
Management Compensation

Compensation is an essential component of human resource management, which aids in motivation of employees, besides enhancing organizational effectiveness. Types of Management Compensation Management compensation encompasses both intrinsic and extrinsic components in the form of monetary benefits and non-monetary benefits such as paid holiday. Compensation incorporates salary, as well as other rewards and allowances given to employees in return for their outstanding services. Compensation can be depicted as representing base pay, long-term incentives, bonuses, stock options, and benefits (Davis and Edge 2). The goal based incentive (stock options, bonuses, and long-term incentives) is fashioned at aligning the corporation’s interests (financial success) with those of top managers. Description Management compensation is an effective means of enhancing the productivity of the employees and ensuring that deserving employees feel appreciated for their efforts. Some companies utilize management compensation as a tool for fostering a performance-oriented culture where the employees focus on the company’s overall strategic goals. Management compensation is meant to motivate the employees, especially the top management within a company. The motivation of management compensation is to align the employee performance with the business goals, besides enhancing employee satisfaction and retention. ...Show more

Summary

Author Tutor Course Date Management Compensation Introduction Management compensation encompasses all forms of financial returns and other benefits that employees receive in their tenure of employment in return for their enviable contribution to the organization…
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