How to Design a Fair Compensation System for Agile Companies

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Employee Compensation (Pay Structure) > Forum > How to Design a Fair Compensation System for Agile Companies

How to Design a Fair Compensation System for Agile Companies
Hong Sun, Management Consultant, Canada, Premium Member
In his book Management 3.0 workout, Jurgen Appelo argues that in agile (innovative) companies, people should not be paid according to the time they spend in work or only the results of their work. Rather they should be compensated based on two types of effort they put in work: 1. The effort of pursuing new things that add value through experimentation (innovation), and 2. The effort of following good practices that are already known (deliberate practices) In order to measure these efforts, we must rely more than before on peer pressure since coworkers are fine observers of each otherís behavior. A compensation plan should have two parts: a salary formula and a merit/bonus system. Salaries are predictable stable monthly income, while merits money is unpredictable in line with the varying business environment.
  1. Part oneóDesign a Salary Formula:
    • Step one: Group people into broad categories (C). Categories are defined by the strategic value the group (...) Read more? Sign up for free

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Employee Compensation (Pay Structure)
Summary
Forum
Universal Compensable Factors, Hay Factors and Dimensions
🔥Six Rules for Designing Rewards (Appelo)
How to Design a Fair Compensation System for Agile Companies


Employee Compensation (Pay Structure)
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