Salary Structure

Comp & Ben Series: 3- Pay For Knowledge & Skills”

Organizations look at employees’ productivity through three lenses

       Employees hardly deliver results without interpersonal competence such as communication, team working, leadership, quality…etc. Organizations look at employees’ productivity through three lenses. How they achieve results “Competencies,” What outcome they obtain “Objectives,” How they improve themselves and consequently their workplace (Acquire necessary Knowledge, Skills, and Attitude “KSA”). If the organization’s industry focuses on results, projects, and objectives, then management by objectives will be a good fit for its strategy. Industries such as real estate, construction, projects …etc may embark on pay for performance “Meritocracy” as the primary compensation practice to motivate employees while attaining results.

          We live in a universe where everything moves. If you throw an object in space, then it will never stop and might orbit a bigger planet. In poems, life does not end unless the ocean waves will. Everything moves with time. Evolution is constant. If we take the same concept to business, then we can replicate it by introducing the third dimension of KSA (knowledge, Skills, Attitude) to the existing two other ones: Objectives and Competencies. It provides a simple explanation of how employees develop themselves and their work business environment by acquiring knowledge and applying it to their job. Employees can stay for years doing the same job unless they accumulate knowledge, learn skills, and improve their attitude. By using what they gained, then they can move continuously up the career universe without stopping.

       Industries focusing on innovation, knowledge, and personal skills pay for the person rather than performance. Organizations which base their core operations on knowledge accumulation such as Art, animation, graphic design, architecture, programming, coding, artificial intelligence, robots, software development.etc., value knowledge and skills more than anything else. Most of the times, it is reflected in the companies’ book financial value under “Good Well” item which consists of intangible assets such as human capital (Knowledge Accumulated) which investors are willing to pay for as a premium

      Finally, the Compensation & Benefits specialist must understand the organization’s type, industry, and core activities, to propose the right policy whether it is going to be based on meritocracy, pay for person (knowledge, Skills, Attitude), or both. It is a prerequisite to come up with this decision to move to the second step which will be: Job evaluation technique.

(To be continued….)


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