Barcelona and Real Madrid are dominant forces in world soccer as well as domestically in Spain, but what role does reward management play in their success and what can organizations learn from their successful team reward strategies? With organizations increasingly utilizing team work in order to increase company performance and competitive advantage there are some key lessons that they can learn from two of the most successful teams in world sport today.
Key Topics: Team performance; Pay-for-performance; Pay dispersion, Merit pay; Bonuses
Do employees really care about what their peers earn? A German study examined the effect of the compensation level of comparable peers on the job satisfaction of managers in the chemicals industry over a five-year period and found that their job satisfaction levels were indeed affected by peer compensation, both in their own company and in the industry more broadly. The effects were found to differ across a number of key criteria, including gender and age.
Key Topics: Social comparison; Job satisfaction; Compensation; Benchmarking
Effectively managing employee turnover is a primary concern for many companies, as they try to retain their most talented employees. Effective turnover management can be particularly important when it comes to the CEO’s top team, as their departure can often have a significant impact on overall company performance. A study of Standard & Poor’s 500 companies from 1994 to 2008 examined the impact of pay dispersion, pay disparity, and pay level relative to the market on executive turnover, and found that not only did these factors significantly impact turnover but that they interacted in interesting ways to increase or decrease turnover levels.
Key Topics: Executive compensation; Benchmarking; Pay disparity; Pay dispersion; Turnover
As companies continue to strive to fill jobs with the best talent, their search often ends with hiring candidates sourced from outside of the company. A 5-year study of executives at US hi-tech manufacturing companies examined the role that the external labour market plays in gender pay differences. While female executives were found to have higher compensation than comparable men, the results indicate that women hired externally receive less than those hired internally, and as such may be disadvantaged by the external labour market.
Key Topics: Gender pay gap; External labour market; Executive compensation; Promotions; External recruitment
Gender pay gaps continue to persist in many countries, despite direct intervention by governments, regulators, and companies alike. So why does this apparent gender pay inequality continue? A recent German study examined some of the underlying mechanisms relating to perceptions of fair pay and found that both men and women held the belief that lower pay for women was fair. These beliefs appear to be formed and ‘legitimized’ based on people’s experiences of pay inequality in their own occupations and experiencing more value placed on the input of men in the workplace.
Key Topics: Gender pay gap; Fair compensation; Performance evaluation; Pay inequality
In many countries, gender diversity in the workplace is a hot topic and the role of women on corporate boards and compensation committees has come under scrutiny from regulators and legislators. A recent study of US companies examined the effect of compensation committee gender diversity on CEO compensation. Unsurprisingly, women were found to be underrepresented on compensation committees, however of the female members that there were, they were found to be younger and less experienced that their male counterparts. Additionally, greater gender diversity on compensation committees was not found to significantly influence the determination of CEO compensation.
Key Topics: Compensation committee; Gender diversity; Executive compensation; CEO compensation
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