Career Development Plan Part 5 – Compensation Essay
Their only a couple more stages left in forming the career development plan. This letter will explain the new compensation plan for the sales team at InterClean. It will outline the new compensation plan and describe how it will help motivate employee performance, describe our total rewards program, and explain how this program will benefit the individual and InterClean. Compensation Plan The new compensation for the sales team will include both financial and non financial benefits.
An organizational reward system includes anything an employee values and desires that an employer is able and willing to offer in exchange for employee contributions more specifically such compensation includes both financial and non financial rewards. ” (Cascio, 2005) Financial rewards include direct payments to salary as well as indirect payments to salary such as employee bonuses. Non financial rewards include day to day work environment appearances that enhance an employee sense of self respect. For example, training opportunities and involvement in decision making.
The new compensation plan will be a market – based pay structure for the employees. When an employee understands their specific detail of their job description it is a key tool in the destination of their pay system. We have already identified the important characteristics of each job; next step is to determine how much InterClean is willing to pay for such a skill. Each sales team member will have a set base salary of $35,000. From this salary a commission incentive program will help motivate each employee to perform at their highest level of achievement.
An incentive programs goal is to tie pay increase to each employee’s level of job performance. When a sales commission program is involved with pay it will increase the employee’s drive to earn a abundant amount above the base salary through performance. The commission incentive program is based 100% on base salary plus a 10% commission rate for monthly sales. Employee’s willing to take the extra step will have countless earning capabilities to make more money, while other employees can be comfortable at the set base salary.
Another portion of the compensation plan will include quarterly bonuses based upon performance measures. InterClean must reach a minimal target of $900,000 per quarter in total transaction for this portion to take place. Once Interclean has reached its quarterly goal each employee will receive a 5% performance bonus. Working with a market-based pay system will provide competitive wages for our sales team. With a base salary, quarterly bonuses, and commission InterClean employee’s will have the drive to success. A commission incentive program will have a generous structure that will motivate performance on each employee.
When a company does provide such a program the employees go out of their way to increase their salary and escalate productivity. Providing the right amount of base salary plus the right amount of commission, InterClean will appeal to and retain the top employee’s without jeopardizing any relationships with their other employee’s. Total Rewards Package The three most influential components of a total reward package that will motivate employees to reach their peak performance are benefits, work life balance, and compensation.
Benefits make up more than half for any companies total reward package. Benefits are what attract the employees, keep the employees at the company, and motivate each employee for more success. Next important component is making sure the employees have a balance work life schedule. Flexible scheduling, childcare, and tuition reimbursement are some rewards that define this package. Employees can work at home as well when arranged between them and their manager.
Statistics show that when an employee is happy outside of work, they will do better in work. The last component for the total rewards package is compensation. Benefits might attract the employee but compensation is what brings in the employee. The right amount of compensation will bring in the perfect sales team. Compensation plan’s benefits The new compensation plan will provide benefits to all employees as well as to the company. The company will benefit through increase revenues, and the employees will benefit through the total rewards package.
Employees have a chance to increase their salary through commission and hit quarterly bonuses as a team. This allows employees to work in a team environment and bring positive benefits to the company. It is important for InterClean to have a detailed compensation plan for our employees. In this compensation plan employees have the option of increasing their pay or staying at their base salary. At either option, employees win because an employee is in charge of how much revenue they will be making, which leads to happy and motivated employees.