Research Project: Managing Total Compensation (9-10 Pages) (Due: Feb. 24th)

Required Documents Attached

Research Project: Managing Total Compensation  

The purpose of this assignment is to allow you to demonstrate your applied interpretation of total compensation management strategy and practice not the textbook theory. 

It is best to use the company:
“Fiat Chrysler Automobiles”

You will select two functional areas and then take a deep dive into those two areas for your research paper.

Send me your company selection and two functional areas no later than Friday, January 10th

I would like some additional information when you submit the company and functional areas for your project. Include the positions you will be working on. Example: Functional area: Sales Position: Inside Sales Team Friendly reminder that I need “two distinct” functional areas. The positions you submit cannot be in the same functional area.

Once you have a company and two functional areas selected, please email the information to me for my approval.

Using the strategic decision model outlined in the text (Chapter 2- Exhibit 2.6) (PDF Attached to Question)

· Present a proposal outlining your recommended Compensation Strategy for the two functional areas at the organization you have selected.

· Your strategy should address critical issues of compensation and employee engagement for the existing workforce.

· Your paper should be 9-10 pages (double-spaced, 12-font) giving a high-level overview for senior leadership of CEOs the information needed to make a decision whether to pursue the proposal further. 

· Ultimately, your recommendations should link the corporate objectives of the functional areas to any critical compensation factors impacting the organization.

The paper needs to include the following components with headings and subheadings for each required item listed below:

Paper Format: Headers

· Executive Summary

· Introduction

· Process of Formulating a Total Compensation Strategy

· Analysis of Critical Factors

· Implementation Strategy

· Reassessment

· Conclusion

· References

Executive Summary (1-2 pages) 0 – Gives a
high level summary
of the entire research paper

Body of the paper (8 – 9 pages) must address each of the following:

1) Introduction: Identify the compensation strategy and implications of the strategy. Briefly discuss the objectives of your proposal: Identify the problem, acknowledge the problem and how your proposal would resolve or benefit the organization.

2) Process of Formulating a Total Compensation Strategy: Discuss each of the four (4) steps of your proposed total compensation strategy. (Exhibit 2.6)

3) Analysis of Critical Factors: Discuss the relationship between your company business strategy, competitive dynamics, HR strategy, culture/values, social and political context, employee needs, preferences, union perspectives, and contemporary pay (HR) systems.

4) Implementation Strategy: Design your implementation to translate strategy into action. Chose specific techniques to fit your strategy. Discuss what tools, training, resources are needed, what criteria, financials, ROI you plan using during implementation to assure success.

5) Reassessment: Discuss: How will you determine if the proposal is effective? Does it meet the proposed objectives? What is the timing of the evaluation? How will changes be made (if needed)?

6) Conclusion: Briefly summarize the main points of your proposal and provide a rationale for justifying your recommendations, explaining how your proposed compensation strategy will benefit the organization and employees.

References and Format: The paper should follow APA 6th edition guidelines. Use the template I provided. Use a minimum of five outside resources (other than the textbook).  Citation of the text book is not permitted for this assignment as the purpose of this project is to allow you to apply concepts of what you have learned in this course (and other related courses) in a simulated business case. 

A great online writing resource is the Purdue Online Writing Lab and Pearson’s Business Writing Resource (see syllabus for links to these resources).

Grading Rubric:

Executive Summary

10 pts

Introduction

 5 pts

Formulating Process of Total Compensation Strategy

10 pts

Analysis of Critical Factors

15 pts

Implementation Strategy

15 pts

Evaluation and Assessment

15 pts

Conclusions

 5 pts

References

 5 pts

Grammar and Structure

20 pts

Research Project:

Managing Total Compensation

The purpose of this assignment is to allow you to demonstrate

your applied interpretation of
total compensation management strategy and practice

not the textbook theory.

It is best to use the compa
ny
:
“Fiat Chrysler Automobiles”

You will select two functional areas and then take a deep dive into those two areas for
your research paper.

Send me your company selection and two functional areas no later than Friday, January 10
t
h

I would like some additional information when you submit the company and functional areas
for your project. Include the positions you will be working on. Example: Functional area:
Sales Position: Inside Sales Team Friendly reminder that I need “two distinc
t” functional
areas. The positions you submit cannot be in the same functional area
.

Once you have a company and two functional areas selected, please email the informati
on to
me for my approval.

Using the strategic decision model outlined in the text (Chapter 2
–

Exhibit 2.6)

(PDF
Attached

to Question
)

·

Present a

proposal outlining

your recommended

Compensation Strategy for

the two
functional areas at the organization you have selected
.

·

Your strategy should

address critical issues of compensation and employee engagement
for the existing workforce.

·

Your

paper
should be 9
–
10 pages (double
–
spaced,

12
–
font)

giving a high
–
level
overview

for senior leadership

of CEOs

the information needed t
o

make a decision
whether to pursue the proposal further.

·

Ultimately, your recommendations should link the corporate objectives of the functional
areas to any critical

compensation factors impacting the organization.

The paper needs to include the
following components

with headings and subheadings
for each required item listed below:

Paper Format:

Headers

·

Executive Summary

·

I
ntroduction

·

Process of Formulating a Total Compensation

Strategy

·

Analysis of Critical Factors

·

Implementation Strategy

·

Reassessment

·

Conclusion

·

References

Research Project: Managing Total Compensation
The purpose of this assignment is to allow you to demonstrate your applied interpretation of
total compensation management strategy and practice not the textbook theory.
It is best to use the company: “Fiat Chrysler Automobiles”
You will select two functional areas and then take a deep dive into those two areas for
your research paper.
Send me your company selection and two functional areas no later than Friday, January 10
th

I would like some additional information when you submit the company and functional areas
for your project. Include the positions you will be working on. Example: Functional area:
Sales Position: Inside Sales Team Friendly reminder that I need “two distinct” functional
areas. The positions you submit cannot be in the same functional area.
Once you have a company and two functional areas selected, please email the information to
me for my approval.
Using the strategic decision model outlined in the text (Chapter 2- Exhibit 2.6) (PDF
Attached to Question)
 Present a proposal outlining your recommended Compensation Strategy for the two
functional areas at the organization you have selected.
 Your strategy should address critical issues of compensation and employee engagement
for the existing workforce.
 Your paper should be 9-10 pages (double-spaced, 12-font) giving a high-level
overview for senior leadership of CEOs the information needed to make a decision
whether to pursue the proposal further.
 Ultimately, your recommendations should link the corporate objectives of the functional
areas to any critical compensation factors impacting the organization.
The paper needs to include the following components with headings and subheadings
for each required item listed below:
Paper Format: Headers
 Executive Summary
 Introduction
 Process of Formulating a Total Compensation Strategy
 Analysis of Critical Factors
 Implementation Strategy
 Reassessment
 Conclusion
 References

Running

head: RESEARCH PROJECT

1

RESEARCH PROJECT 16

Research Project

–

Managing Total Compensation

Name

Institution

Executive Summary

The research proposal paper aims at managing the total compensation of the Fiat Chrysler Automobiles particularly in the manufacturing and marketing departments of the company. The company has two ways of compensating employees in these departments which is through salary and benefits (Chiarini & Vagnoni, 2015). The paper will try to solve this problem in the current compensation system and a new compensation strategy will be formulated to benefit the organization. The new strategy will help in increasing employee satisfaction and reduce turnover rate.

The first step that will be followed when formulating a total compensation strategy is assessing the total compensation implications which focus on the business strategy and external dynamics in relation to the compensation system of Fiat Chrysler Automotive. In mapping a total compensation strategy, management objectives, employee contributions and market analysis of the company are visualized. The mapped strategy will then be implemented by designing a technique that suits the compensation system of the company and finally the strategy is reassessed for any changes or improvement (Har, 2019).

The proposal analyses the critical factors by discussing the relationship between Fiat Chrysler Automobiles’ business strategy, its competitive dynamics, its human resource strategy, and culture. The company’s business model has diverse products and a worldwide market which gives it an advantage over its competitors and employees are also trained to be more innovative. The productivity of the employees is also another emphasis that the company addresses in its business strategy (Bertoldi et al., 2015).

The relationship between the employee needs, social and political context, preferences, union perspectives, and contemporary pay systems is detailed in the paper. Fiat Chrysler’s pay system meets the legal requirements and it also puts into consideration the demographics of the workforce (Caputo,2019). The modern pay system of the company and union preferences that affect the payment system is also discussed in detail. This analysis is important because it helps in identifying the strengths and weaknesses within the company and opportunities and threats outside the company (Biasi, 2015).

This paper also has an implementation strategy that is designed to translate into action and there are different techniques chosen to fit the implementation strategy. There are also different tools, training, and resources required mentioned in this section. The criteria used in the implementation process and how it will bring profitability to the company are described. During the implementation process, the company will have to comply with the federal and state laws that are related to pay (Johnson et al., 2016).

The reassessment is also looked into, the effectiveness of the proposal is determined and if it meets the objectives and goals. Similarly, how changes in the proposal will be made are also discussed. The last part of the paper provides a rationale for the recommendations made in the proposal and how they will benefit the manufacturing and marketing departments of Fiat Chrysler Automobiles.

More content needed to fill this page. Please stop creating new paragraphs to take up space. A full paragraph is five sentences

Introduction

Briefly discuss the objectives of your proposal: Identify the problem, acknowledge the problem and how your proposal would resolve or benefit the organization.

This research proposal aims at managing the total compensation of manufacturing and marketing functional areas of Fiat Chrysler Automobiles (FCA). It also aims at identifying the problem of the current compensation strategy of these functional areas particularly with the production manager and the advertising manager to increase profitability and productivity in the company. The proposal will aim at developing a new compensation strategy and how it will be implemented. It equally aims at how the newly developed compensation strategy will benefit the organization by increasing employee engagement, retention and satisfaction (Chiarini & Vagnoni, 2015).

The problem of the current compensation plan at the company is that it mainly focuses on salary payments and a few benefits. There has also not been an increase in salary for the production manager and advertising manager in the past three years and this does not motivate the employees to work harder in their functional areas.

(Where are the in-text citations of source used to verify this statement?) The average yearly pay for managers at Fiat Chrysler Automobiles is $70, 000 and this is twenty percent below the national average (Mendonca, 2015). This research proposal will design a compensation strategy that will solve these problems and greatly benefit the company (How and what? How will your recommendations solve these problems and what are your recommendations?

Process of Formulating a Total Compensation Strategy

Process of Formulating a Total Compensation Strategy: 

Discuss each of the four (4) “steps of your proposed total compensation strategy”.

Step 1: Assess the total compensation implications

The first step in formulating the total compensation strategy is to assess the total compensation implications. FCA’s business strategy is focused on profitability, productivity by ensuring that targets are reached and its competitive advantage over other automobile companies is the quality of its products. As an automotive company, FCA also has to consider the changing consumer needs. The compensation system supports the business and competitive strategy by paying the employees well and on time to increase their productivity. The pay strategy also fits with the human resource system of the company and also aligns with the company’s culture by ensuring employee satisfaction at work. In the social context, FCA puts more emphasis on the luxury division and also takes part in environmental initiatives. The pay system should also be designed to satisfy employee needs and preference as this adds value and is difficult to be imitated by other companies. The union’s preference also affects how the employees are paid. For instance, The United States auto companies have a program that enables employees who are no longer needed to make cars to continue getting paid until they are needed again (Rymkevich, 2013). (What are you recommending that FCA changes? (What’s is the first step that FCA should take in your newly proposed compensation plan and where is the mention of production manager and advertising manager)

Step 2: Mapping a total compensation strategy

The second step in formulating a total compensation strategy is mapping a total compensation strategy. The elements of compensation strategy such as contributions, objectives, management, competitiveness and policy choices need to be pictured. This will help when marketing the products of FCA to differentiate from competitors’ products (Har, 2019).

This strategic map will also show the company’s compensation strategy and illuminate the message it is trying to deliver with the set compensation system. The company can use various dimensions to map compensation strategies. One of the dimensions is the objectives and the importance of the total compensation in the company’s human resource is measured. The other dimension is internal alignment where the pay as per the job level is showed and whether the compensation system of the company support career growth (Har, 2019).

In the same way, external competitiveness is the other dimension that can be used in mapping out the total compensation strategy by comparing the competitors’ pay and form of payment. The company could also use employee contributions to map the compensation system by having its own performance-based pay approach. The last dimension that can be used in mapping the total compensation strategy is management. The owners of the company should make a payment related decision like capital budgeting, capital structure, and working capital management which they should be open and communicate about (Har, 2019). (What’s is the second step that FCA should take in your newly proposed compensation plan and where is the mention of production manager and advertising manager)

Step 3: Implement the strategy

The third step is to implement the strategy. The company should design a system that translates strategy into action and it should come up with a different technique that fits the strategy. The company could come up with a stock option as a form of compensating the employees whereby they choose between owning the stock at Fiat Chrysler or being paid their salaries

. (This statement makes no sense; no one is going to choose stock over salary. Stock is an extra incentive, please edit) this form of compensation could be great for employees who would want to invest their money in the company (Kotnik et al., 2018). What other options can FCA do to implement your recommended compensation strategy? More content is needed. (What’s is the third step that FCA should take in your newly proposed compensation plan and where is the mention of production manager and advertising manager)

Step 4: Reassess and Realign

The last step in formulating a total compensation strategy is to reassess and realign. In this step, the compensation strategy is changed to fit any changing conditions. These changes are continuous and this ensures that the compensation systems are adaptive and improved. The stock payment option should be checked and reviewed to ensure that it is aligned with the salary option. This is more crucial when the company stock falls or rises. The valuation of this pay system results should also be done and the objectives of the system should, equally, be achieved (Kotnik et al., 2018) (Now that you have explained this step, please explain what you would recommend FCA to reassess and realign in regards to our compensation strategy recommendation) More content is needed. (What’s is the fourth step that FCA should take in your newly proposed compensation plan and where is the mention of production manager and advertising manager)

Analysis of Critical Factors

Discuss the relationship between your company business strategy, competitive dynamics, HR strategy, culture/values, social and political context, employee needs, preferences, union perspectives, and contemporary pay (HR) systems

Business Strategy and Competitive Dynamics

FCA is a company in the automotive industry and it puts more emphasis on quality and diversity in its products to differentiate it from other companies and give it a competitive advantage. The business model of the company offers extensive market coverage with higher perceived product innovation. The company also focuses on the productivity of its employees and the profitability of the business (Bertoldi et al., 2015). As consumer needs continue to change over time, the company strives to satisfy these needs by observing the current trends and the competitors’ actions. The compensation system in the manufacturing and marketing functional areas of the company support the business strategy and competitive dynamics by ensuring that the employees are paid well enough salary to increase their productivity and increase retention possibilities. This also ensures that the best employees are not attracted to competitor companies’ pay (Bertoldi et al., 2015).

Human Resource Strategy

The human resource system in FCA focuses on a performance-based pay system and different job positions have different salaries. The company’s performance appraisal technique aims at actively improving employee engagement among its workforce to ensure that they are a part of the dynamic fast-paced workforce. The other strategy used by the company’s human resource department is to ensure that they attract, develop and retain talent through working together with the management team (Chiarini & Vagnoni, 2015). More content is needed and where is the mention of production manager and advertising manager)

Culture/ Values

Culture is a set of values, symbols, beliefs, and assumptions that define how a company conducts its business. FCA empowers its employees to drive change, lead people and take on challenges. The company’s core values are a meritocracy, embracing and cherishing competition, leadership, achieving the best performance and delivering its promises. Managers in the manufacturing and marketing functional areas encouraged to take on challenges and helped to succeed in their roles. The production manager and marketing manager are paid enough salary that motivates them to abide by the company’s culture and values (this is an opinion not a fact) (Fitzsimmons & stamper, 2014). More factual content is needed regarding production manager and marketing manager

Social and Political Context

The company has to ensure that its pay system is as per the legal and regulatory requirements, for instance, the employees pay should be able to meet the required minimum wage and that the overtime is also included in their salaries. The company also has to ensure that its software does not violate pollution regulations. The pay system also has to depend on the workforce demographic. For instance, younger employees may prefer salaries as they need to feed their families, pay loans and mortgages while older employees may opt for a retirement savings plan. Employees with children with disabilities or special needs should be given more support to keep them satisfied. This could be done by forming support groups within the company to help them (Caputo,2019).

Employee and Union Preferences

Employee preference can also be similar to the age in demographics. Different age groups prefer different payment systems and the company should formulate a compensation strategy that covers all the employee needs. Some may prefer flexible schedules as others need high salaries to cover their needs (Innerbichler, 2016). The union also influences the pay decision in the manufacturing functional area of the company as they prefer health care plans for employees to ensure that their health is prioritized. The United States auto companies have a program that enables employees who are no longer needed to make cars to continue getting paid until they are needed again (What is the name of this program and does FCA use it?). This pay system works for the production manager in the manufacturing department (Rymkevich, 2013). More factual content is needed regarding production manager and marketing manager

Contemporary Pay (HR) Systems

The contemporary pay system of Fiat Chrysler is based on individual performance and business performance. Employees are given bonuses if they achieve or exceed their targets and also if the company achieves or exceeds its business target. By using the merit matrix, the company should provide higher increases to employees who perform better. The company is still using the annual performance review which does not help in catching misdirection earlier. Frequent reviews and feedback could help the company in aligning its activities with its business goals (Biasi, 2015).

Implementation Strategy

Design your implementation to translate strategy into action. Chose specific techniques to fit your strategy. Discuss what tools, training, resources are needed, what criteria, financials, ROI you plan using during implementation to assure success

To design an implementation strategy, there will be an inclusion of FCA’s approach to allocating compensation dollars into salary and benefits. The budget allocation will help in determining how much of the total compensation budget will be spent on salary, benefits, and other incentives (What other incentives). The annual budget will be $500, 000 for the production and advertising manager positions (Cillo & Pradella, 2019). The other criteria for designing the implementation strategy is by developing salary ranges. FCA’s human resource team will have to conduct research internally to establish salary ranges that match the job description of the production manager and advertising manager. Performing regular salary audits also ensures that salary ranges in the manufacturing and marketing functional areas reflect the current compensation trends in the automotive industry. Failing to pay attention to market changes and trends may lead to the loss of potential employees. Similarly, benefits packages will be used in addition to salary to attract and retain the advertising and production manager positions (Johnson et al., 2016).

The implementation strategy will also involve a structured performance management process that will ensure the production and advertising managers meet the corporate objectives. This will include having annual targets and performance appraisals to increase and positively influence employee engagement. Training will also be available to the production manager to develop his or her skills. The implementation strategy design will incorporate legal requirements which will ensure that the company complies with the federal and state laws. There will no biases when making hiring decisions and ensure compliance with minimum wage and overtime pay laws. The implementation strategy design also recognizes and rewards the production manager and advertising manager’s performance by including raises in their salaries that will help in establishing a strong culture of employee engagement (Johnson et al., 2016).

In the manufacturing department, the production manager will be compensated using different techniques including a salary that matches the responsibilities required. He or she will also be entitled to overtime pay to cover any extra time worked during production. There will be ample time off for managers which includes 20 days. In the same way, the production manager will be entitled to health and life insurance benefits (Caputo, 2019)

In the marketing department, the advertising manager’s compensation will comprise of salary as per the position’s responsibilities. In addition to this, the advertising manager will be given time off of 20 days which is entitled to all managers. Similarly, there will be annual paid vacations, leaves, comprehensive health care benefits, medical, dental, vision and prescription drug coverage (Caputo, 2019).

Reassessment

Discuss: How will you determine if the proposal is effective? Does it meet the proposed objectives? What is the timing of the evaluation? How will changes be made (if needed)?

To ensure that the proposal is effective, evaluation questions will be created and data will be collected, analyzed and presented to the top management team. A survey will be conducted to see what is working, areas that can be improved and if the proposal is effective. The advertising manager and production manager will have to be satisfied with the set compensation plan to ensure that the proposal is effective. The proposal should also be aligned with corporate objectives (Chiarini & Vagnoni, 2015).

The implementation strategy meets the proposal objectives by identifying the problem in the current compensation system in the manufacturing and marketing departments
.(What problems, list them out) The implementation strategy uses different compensation techniques such as salary, commissions, overtime pay, bonuses and paid leave among other benefits. In managing the total compensation and formulating a new compensation strategy, FCA will be able to increase employee engagement, satisfaction, and retention rate. This also ensures that employees are productive which translates to profitability in the long run. The evaluation will take place annually as changes in the implementation strategy will be made during job evaluation and job enlargement when the responsibilities of the production manager and advertising manager are increased (Innerbichler, 2016).

Conclusion

Briefly summarize the main points of your proposal and provide a rationale for justifying your recommendations, explaining how your proposed compensation strategy will benefit the organization and employees

The proposal indicates the process of formulating the total compensation plan for the advertising manager and production manager positions of Fiat Chrysler Automobiles. Critical factors like the company’s business strategies, competitive dynamics, human resource strategy, culture, employee and union preferences are considered when designing an implementation strategy. An evaluation plan is also set in place to determine the effectiveness of the proposal. Benefits such as paid leave, health insurance, and retirement plans should be implemented to increase job satisfaction and employee retention. This will help in retaining the high performing employees who are more productive which translates into profits for the company.

References

Bertoldi, B., Giachino, C., Bernard, S., & Prudenza, V. (2015). Fiat-Chrysler deal: looking for good returns from M & A. Journal of Business Strategy, 36(4), 23-33. Retrieved from

https://www.emerald.com/insight/content/doi/10.1108/JBS-02-2014-0015/full/html

Biasi, M. (2015). Statutory Employee Representation in Italian and US Workplaces: A Comparative Analysis of the Fiat/Chrysler Case. Chrysler Case. Retrieved from

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3135856

Caputo, A. (2019). Case Study: The Fiat–Chrysler Negotiation in 2009. In Strategic Corporate Negotiations (pp. 83-115). Palgrave Pivot, Cham. Retrieved from

https://link.springer.com/chapter/10.1007/978-3-030-15479-0_5

Chiarini, A., & Vagnoni, E. (2015). World-class manufacturing by Fiat. Comparison with Toyota production system from strategic management, management accounting, operations management, and performance measurement dimension. International Journal of Production Research, 53(2), 590-606. Retrieved from

https://www.tandfonline.com/doi/abs/10.1080/00207543.2014.958596

Cillo, R., & Pradella, L. (2019). Remaking the labor movement in Italy: the revival of strikes at Fiat-Chrysler Automobiles in 2015–17. Globalizations, 16(4), 457-471. Retrieved from

https://www.tandfonline.com/doi/abs/10.1080/14747731.2018.1558821

Fitzsimmons, S. R., & Stamper, C. L. (2014). How societal culture influences friction in the employee–organization relationship. Human Resource Management Review, 24(1), 80-94. Retrieved from

https://www.sciencedirect.com/science/article/pii/S105348221300034X

Har, S. M. (2019). An Analysis of Corporate Governance in Internal and External factors of Fiat Chrysler Automobile. Retrieved from

https://mpra.ub.uni-muenchen.de/id/eprint/97245

Innerbichler, R. (2016). A multidimensional valuation model of M&A transactions: the Daimler-Chrysler and the Fiat-Chrysler cases. Retrieved from

http://tesi.cab.unipd.it/54748/1/Innerbichler_Roman

Johnson, J. S., Friend, S. B., & Agrawal, A. (2016). Dimensions and contingent effects of variable compensation system changes. Journal of Business Research, 69(8), 2923-2930. Retrieved from

https://www.sciencedirect.com/science/article/pii/S014829631500702X

Kotnik, P., Sakinç, M. E., & Guduras, D. (2018). Executive compensation in Europe: Realized gains from stock-based pay. Institute for New Economic Thinking Working Paper Series, (78). Retrieved from

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3228809

Mendonça, I. A. P. D. C. (2015). The system of Transfer Pricing in a multinational (Doctoral dissertation). Retrieved from

https://run.unl.pt/handle/10362/15608

Rymkevich, O. (2013). International trade union solidarity in the automobile sector: The case of Fiat-Chrysler. European Labour Law Journal, 4(4), 272-291. Retrieved from

https://journals.sagepub.com/doi/abs/10.1177/201395251300400403

Running head: RESEARCH PROJECT

1

Research Project
–

Managing Total Compensation

Name

Institution

Running head: RESEARCH PROJECT 1

Research Project- Managing Total Compensation

Name

Institution