Compensation Plan For Investsur Company Essay.

1. Present a compensation plan/system for the company. I would go to the UCD library and search any book on HRM that is available there online and take a compensation/pay model. Explain the model and how the model suits the company.
2. Analyse the two contexts where you will implement the model and identify potential institutional and cultural differences.
3. Based on the previous analysis (institutional and cultural), explain how the compensation plan is going to be adapted to the host country, in this case Singapore.

A company can be said to be successful if they have a strong presence in the external market and the profit that they are making from the market. However, it can be said that the employees in an organization are the ones who help in proper functions of the organization. It is important that the employees should be taken care of properly so those are able to feel good in the organization where they are working (Fee 2014). There will be tough times for the company when they are opening a new business any new location. They have to adjust the employees who are working for the company (Armstrong and Taylor 2014). The problem even deepens when multiple offices are present in countries that are entirely different in culture and the way of work. The employees have entirely different outlook for work and they are not able to understand the way the other offices are working (Brewster, Mayrhofer and Morley 2016). The employees work in a work culture and they are not able to gel with news of the company in other countries (Sparrow, Brewster and Chung 2016). The cultural differences are not only visible their ways of working but it is reflected in the pay scale or the factors that decide their pay scale (Storey 2014).

Investsur is an investment company, which had its main office at Ireland. They are opening their new business in Singapore. To extend their business, they are recruiting 200 employees for their offices in Ireland as well as Singapore. The company that is working with the employees in Ireland will face issues while working with the employees in Singapore. The level of competitiveness and the way of working will vary among the employees in other countries. The report will look into the pay model that could be applied to understand the pay system that would be helpful to handle the employees in Ireland as well as Singapore. The issues that will rise while implementing the pay systems will be discussed in the report. A compensation plan that could be applied in the host country so that it is able to handle the employees both in Ireland as well as Singapore will be suggested.

The pay model that has been introduced in the book, ‘Private Pay For Public Work- Performance-related Pay For Public Sector Managers’ has been adapted from the payment system is used in the government pay system. The performance-pay scheme or model could be applied to the middle or the junior level managers who are working in an organization. Based on their performance, they are being appraised in the organization (Xing and Liu 2016). However, the model would be default to apply for the managers who are working in the senior positions, as there will not be any appraiser, who will be evaluating the performance of the managers in the senior positions (Leggett 2007). In many cities, the performance based pay model is not accepted as it done by the managers who belong outside the workplace (Gill and Wong 1998). They are not aware of the issues that are going inside the office and just going through the performance of the employees, they decide the pay that should be received by the employees.

Implementation

The pay model will be feasible if the appraiser is one of the members of the organization. The appraiser will rate the employees based on the performance and then the pay scale of the employees will be decided by the rating that will be given by the managers. However, if the performance pay model is being applied to the senior managers then the external ministers could have been involved in the appraisal. As the manager might not be directly involved for any kind of work directly, hence, the external people could be involved in the process. They will look after the overall operations of the organization.

The performance pay model can be applied in the organization by comparing other departments that are working. If the employee of one department are working well, then the appraiser can compare the work of the employees with the another department. If not all the departments are being able to perform well in the similar manner then it would be understood that the fault is not of the employees and the organization is not performing well. The performance pay model also talks about the fact that a senior committee should review every aspect once the appraisal is being done. The review should be done for all the employees in the organization. Review of the rating as well as the pay should also reviewed by the senior management.

The pay model is mainly based on the fact that the performance of the employees will help them getting proper pay. However, while implementing the pay model in Singapore, Investur will face issues as the level of competitiveness will be different from the employees in Ireland and Singapore. As per a study, the level of competitiveness among the employees of Singapore and Ireland hugely differs. When on one hand, the level of competitiveness among the employees in Singapore among the employee ranks number two in the world. On the other hand, Ireland ranks number 24 in the world when it comes to the level of competitiveness (Guidemesingapore.com 2017).  The difference in the level of competitiveness is mainly based on the difference in the perception of the people in the western countries and the Asian countries. People in the West believe in working and resting. They feel that rest is an important part of job and one should give considerable amount of time to rest as he or she gives for work. However, the people in Singapore have a different concept. They do not believe in taking rest and contribute maximum time for work. They take minimal amount of rest and feel that the more rest that they will take it will affect their productivity. Thus, Investur will face issues while implementing the pay model. The pay model depends on the performance of the employees. As the similar company is operating in different locations, it would not be able to apply different set of rules. As the employees in Singapore are competitive, they will be getting better benefits and pay than the employees who are working in Ireland. Eventually, there will be a commotions among the employees in two different nation who are doing the same job and under the same company but will be eligible for different pays dude to the institutional differences between the countries.

As far as the cultural difference is concerned, the Hofstede model shows that the culture of Ireland is more masculine while the culture of Singapore is more feminine (Geert-hofstede.com 2017). The gender has nothing to do with the culture. More masculinity index means people are competitive and they are always in competition with the each other to achieve the desired success. On the other hand, the people of Singapore believes in helping each other and working together and creating shared values among each other. When on one hand, Ireland scores 68 in the masculinity index, Singapore scores 48 in the masculinity index. The difference in the score shows there is a difference in the way the employees work in the organization. While implementing the pay model, Investsur will face issues if the pay model is mainly based on the performance. The employees will work hard to make their performance better and get better pay, however the judging the parameters of performance will be different for the countries. When on one hand, the employee in Ireland will think that once they will perform to make their individual performance better they will be paid more. On the contrary, the employees at Singapore will think once they will be able to work in a team and perform well, they will be judged on that basis. As the employees will have different locations of work, implementation of the pay model will be an issue with different parameters.

There is a huge difference between Ireland and Singapore as far as the individualism is concerned. When on one hand, Ireland, scores 70 in the individualism index, Singapore just scores 20 in the individualism index. As the name suggests individualism, it is based on the way the employees think of working in an organization. The employees in Ireland mainly depend on themselves and they are interested in making the individual performance better. They do not look for the performance of the team. If they will be asked to perform, they will mainly think about enhancing individual performances. They will not think about the team or the enhancement of the business of the organization. Thus, the company might face issues while they will be planning for the competition of the employees in Singapore and the employees in Ireland.

The implementation of the compensation plan will be helpful as the employees in Singapore are competitive enough. They work hard and they are always ready to work in a team (Storey 2014). However, there can be issues that might rise from the different styles of working and the cultural differences in Ireland and Singapore, yet the following compensation plan could be helpful in giving the proper pay to the employees.

As the table suggests that the compensation plan depends  upon the position of the employees in an organization. The commission that they are getting will depend upon the sales of the company (Purce 2014). However, from the boards of directors, until the junior most employee, the sale structure of the company decides the pay scale of the employees. The senior most employees should look after the works of the junior employees as the compensation of the senior employees will depend upon the types the works that are being delivered by the junior employees (Renwick, Redman and Maguire 2013). When in an organization, the problem solving capacity of the senior employees will be judged while giving the compensation (Jackson, Schuler and Jiang 2014).

The table that has been suggested for the compensation for the employees in Singapore and in Ireland will be perfect in spite of the difference in the nations and cultures. The compensation plan will not take into consideration the level of contributions or there would no fix any amount for the employees (Budhwar and Debrah 2013). The compensation plan is based on the amount of contribution an employee is giving to the organizations. The money will be paid based in the current position of the company and the amount of sales that is happening in the organization (Alfes et al. 2013). If the employees are working more, then they would be paid more, if they working less, they will be paid accordingly. As the payment will be done in the currency of the country, the employees will also be satisfied with the pay.

However, problems might arise if any of the employees will have to be transferred from one country to another. The change in the country will result in the change in the currency and that would affect the value of the money that the person has been getting (Riley 2014). However, there will be different compensation system for the employees who are being transferred from one location to another. As the employee is shifting the job location, the employees will be eligible to get different benefits that the other employees are not getting (Armstrong and Taylor 2017). Problems would not rise in this case as re co-employees as they will understand the issues with then transfers (Alusa and Kariuki 2015).

After the basic compensation has been decided, Investsur can then decide other areas of compensation that should be presented in organization and the will help in connecting the employees with the organization.

• Overtime and hourly wage

At times, during the time of pressure, the company might require employees to work extra (Nickson 2013). The company will pay the employees for the extra work that they are doing. The payment will depend on the amount of work that they are doing and the amount of time they are working apart from their normal working hours (Aswathappa 2013). The amount of money would not be fixed and it will vary depending on the urgency of the task. The employees will be paid as per the currency of the country, there will be no discrimination among the employees based on the compensation (Kramar 2014).

• Retirement savings

Every employee should save on the retirement and the organization should be the perfect place to help the employees save post retirement (Hoque 2013). Certain amount of money is being deducted and the company is giving a certain amount of money, which contribute for the savings post retirement of the employees (Marler and Fisher 2013). The contributions of the employee and the employer will be based on the amount of pay the employees are receiving from the employer (Jabbour et al. 2013).

• Annual incentives

The employees should be given annual incentives based on the performance of the employers (Messersmith and Wales 2013). The annual incentives will be given based on the amount that they are getting on regular basis. In place of giving a fixed amount to the employees, the company could be calculated on the percentage of amount of the percentage that they are receiving annually. Thus, the amount of incentives will be based on the amount they are receiving annually from the company and hence, it will vary accordingly. The employees will also no have no issues as they will be getting paid based on an amount that they have agreed on an amount when they entered the job (Sanders and Yang 2015).

Conclusion

After going through the case study of Investsur, it can be said that the employer will face issues while recruiting the employees for the Singapore office and the Ireland office. The main reason behind such issues is the cultural and institutional differences between the countries. Ireland works in a westernized culture while Singapore works in an Asian culture. The employees working at Singapore believe that if they take more rest, they will end up becoming lazy. Singapore ranked number 2 among other countries in the world. On the contrary, Ireland ranks number 24 when it comes to competitiveness. The employees in Ireland believe that they should take rest as well as work. As the employees at Singapore are more active, hence they produce more for the country. Culturally Singapore and Ireland differs a lot when it comes to the management of the employees. As per the Hofstede Model, the masculinity index as well as the individualism index is more in Ireland. The index support the fact that the people in Ireland believes in power and rather giving value to the co-employees, they are concentrates on getting the individual power. Hence, they will be asked to perform they will mainly concentrate on individual performances. On the contrary, Singapore believes in shared values and teamwork. They feel that working with the co-workers will help them to get the necessary success in the organization. when the time will come to pay the employees in two different countries, the employer will face a tough time to decide on the pay for the employees in two different locations. The pay model from the book, ‘Private Pay For Public Work- Performance-related Pay for Public Sector Managers’, is mainly based on the fact that the employees should be paid bawd on their performance. When on one hand, the competitiveness among the employees in Singapore will be more, the competitiveness the employees in Ireland is not up to the mark. Thus, if the employees are being paid based on their performance, there will be discrepancy in the pay scale. However, the compensation plan that has been suggested is aligned with the pay model. As per the compensation plan, the employees will be paid based on their performance as per the standard of the country. the performance of the employees will give an idea about the amount of business the company will make. The amount of business will decide the payment that that the employees will get in the organization; as a result, there would not be any discrepancy in the payment system. The salary of the employees will be fixed, the incentives will vary as per the amount of business. In addition to the salary and the incentives, the employees will receive other compensations like the savings for the retirement, the regular incentives and payment for the overtime that the employees will do in the office.

Even though, the payment model and the compensation plan are expected to be effective for Invetsur, yet it can be recommended that the employees should be paid as per the standard of the country. If any of the employee needs to be transferred to another country, the pay scale will also change accordingly. In this way, the confusion will be less and the employees will hold any grudge against the company. The compensation plan and the pay model is justified is up to the business the company is making and in that particular location. They are not fixing any amount for the employees. If the employees work hard, their pat scale will accordingly. The employers will also not be answerable, as the payment will be based on the work they are delivering to the company. The variations in the competitiveness among the employees will also not be an issue as the payment will differ based on the amount of work that is being delivered by the employees.

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