
Andrea Kirkland 11/02/2019
Hiring and Recruiting in the Supply Chain: Compensation Plan Strategy
The landscape for the hiring and recruiting process is evolving with use of technology. In the supply chain hiring process it is vital to focus on being as competitive and cost effective as possible. In addition, the employment pool selection is skill specific. Therefore, maximizing the opportunity to develop a strong compensation plan can mean the difference to avoid loss of time and risk of failing to capture the necessary talent to meet organizational goals.
Human Resources is tasked with recruiting employees who will bring value to an organization. “The value aspect requires Human Resources to make sure the return on investment surpasses the expectations to align with strategic plans as well as the cost of recruiting and hiring efforts.” (Mello, 2015) There is substantial need to evaluate hiring and recruiting practices from the cost perspective. New hire training costs the organization in a nominal way as the employee is in the introduction phase of learning the job role as well as adapting to company culture. The new hire is inevitably learning to develop a style of completing performance processes. Until they are fully up to speed, there will be a learning curve which should be expected. I think about my time as a new employee. I reflect upon the first day I was placed on a desk with incoming calls. I had to transfer some of those calls to other employees because I did not have all the answers or understanding of the workflow to give an effective response to callers. Furthermore, there is risk to the organization that a new hire might not stay with the company after receiving invested time and money given towards training.
In addition, the strategic process is to manage, train and develop talent and establish policies which protect the organization as well as ensure employment needs produce the outcome stakeholder plans layout for the future of the company. In this regard, the recruitment process is a two-way street. Employees want a good compensation package in exchange for invested time to an organization. On the other hand, companies want the best candidate possible to fit with culture, skills and commitment to advance the organization’s mission in the marketplace. The mission is to thrive in a competitive marketplace.
For anyone tasked with hiring and recruiting responsibility, focus on attracting good candidates who are capable to perform well and contribute to the profitability of the organization. In the industry, there are tools we can utilize to make the screening process quantitative to measure the statistical data involved with the hiring and managing processes. I learned over the course of studying strategic processes for implementation that evaluation of talent prior to offering candidates a job based upon review of performance data offered observable metric contribution from work performed. Analytical data assumptions can be derived through use of statistical measure known as predictive analytics. Managing and hiring workers to complete the requirements of an organization’s corporate goals is the responsibility of knowledgeable professionals in the trade. It is exciting to know there are many ways to use technology, and data to make well informed employment decisions. However, “there are no universally accepted metrics for the valuation of human capital or a standard format for measuring to collect the data.” (Mello, 2015)
During the course of evaluating compensation goals, I learned to respect the weight a compiled compensation plan contributes to the employee’s decision to join an organization. It is just as important for an employer to be competitive in offering a solid employee welfare kit of benefits to the employee as it is for the employee to be cared for while working for the company. As is common place, employees spend more time on the job during the week than at home with their families. It is important to many employees that contribution in time to an employer is valued enough that benefits like medical care, retirement plans, salary and vacation time be available when they need it. As an educated and skilled worker, it is my responsibility to know my value in the marketplace and utilize this knowledge to negotiate from this perspective of understanding during the hiring process. Employment from the corporate perspective can also enter the process knowing the astute candidate will research and compare culture, climate, compensation, career growth and opportunity the organization will deliver for a proper fit.
As I consider how hiring and recruiting processes connect with managing the workforce, it is my opinion that compensation packages, evolved societies, technology and globalization are interconnected to how we work, select, train and expand the workforce in today’s environment. For these reasons, the recruitment process checklist and organizational need dynamic will influence the demand for particular deliverable features in the compensation package.
In my research, the forms of compensation mentioned were pay, benefits, commission and bonuses. “The earliest mention of recorded compensation was referenced in a 1892 textbook which published discussion of a compensation system titled Methods of Industrial Remuneration.” (Sarkar, 2018)
The cost of providing a compensation plan for employees will always be at the forefront of any hiring decisions I make. The expectations of employees, costs of providing compensation benefits, market demands for skilled labor, accessibility to skilled labor and the generation of workers entering and exiting the workforce are an interesting dynamic to consider when compensation packages are compiled. Furthermore, I will have to address indirect compensation attributes for executive level forms of compensation such as dividends when the organization issues stock. there is another form of compensation which is considered indirect. For instance, “dividends and distributions are not earned income and therefore not a direct form of compensation.” (Hoare, 2015).
Compensation is a driving motivation for organization success. The competition between organizations to obtain talent is fierce. I think about a particular instance when I was recruited by a competitor. The compensation package in total was not better and that made my decision for me. At the time, my employer offered a better package. Compensation is more than salary and a comprehensive package with an array of benefits is a tool which can not be loosely staged without strategy. The compensation package has measurable weight for competitive factor. For instance, “the extreme compensation awarded to the CEO attracts increasingly competent candidates who willingly compete for the CEO’s position.” (Main et al., 1993)
This gives further notion to the fact just the opposite can happen when a compensation package is not competitive or rewarding to the employee as retention will become an issue. Human Resources practices must utilize the best mix of tools and practices to draw the right candidate.
Technology can help you meet requirements of hiring processes and transfers the process to a record which you can use repeatedly to make practical hiring decisions. In effect, you can match strategic goals using metrics from the data. Furthermore, you can use technology to locate salary information online or through trade association surveys and polls on the internet.
This is a good start for Human Resources to gauge the going salary rate offered by competitors by job title and market location. The consensus noted in a past employment survey is although employers are providing more to compensation packages to draw and retain talent, “when it comes to mental health benefits and retiree healthcare benefits there have been tremendous cuts.”
(Nance-Nash, 2003)
In addition to salary and compensation related decisions, use of technology to assess behavioral indicators give insight to the candidate’s propensities to align with corporate culture. Screening methods to evaluate candidates utilizing personality tests and other aspects of predictive metrics to determine employee fit with the organization will continue to be at disposal. As Supply Chain Management processes expand over the digital landscape, technology can only be expected to evolve with use of A.I. in the recruiting and hiring process.
For instance, using data, regression and assumptions, quantitative analysis can build the predictive model for Human Resource metrics. Going further in the examination of pay structure and how compensation offers evolved to coincide with accessible uses of technology, consider how the organization can distinguish itself among competitors. Furthermore, understand how distinction in the compensation plan offered can appeal to workers in varying life stages.
Employers can provide an array of options suited for the type of work culture and brand developed for the organization. For instance, offer flex time for parents picking up children after school in addition to changing lifestyle benefit options like ride share reimbursement and holistic wellness programs.
In managing an organization, we know employees are an asset. It is imperative to let employees know they are valued. Employee contribution to an organization’s survival is an investment in competitive advantage. By developing a comprehensive compensation package to provide reciprocal care of employees in exchange for the employee’s return contribution in the form of labor to the organization, Human Resources management of human capital in essence supplies “the motivating impact proposed that employees work purely for money and put forth extra effort on the job to maximize their economic gains.” (Sarkar, 2018) In the process, Human Resources must determine if compensation is reasonable as well. “Employee qualifications are a factor in determining whether compensation is reasonable. Corporations often rely on comparing similarly situated executives of other companies when establishing reasonable compensation.”
(Campbell, Smith & Martin, 2019)
It is also necessary to navigate the legal landscape appropriately to avoid penalties with Title VII. It is important for organizations to ensure fair and equitable hiring practices meet policy. This will maintain a reputable standing in the business community and avoid risk to the organization’s brand.
Besides the navigating the legal aspects of hiring and recruiting decisions and compensation packages for strategic advantage, globalization and corporate expansion will require tailored compensation plans which meet the local needs of the employment pool. The needs of works will be determined by employee expectations.
In my opinion, the needs of the employee should match the expectations of employment for the organization to support organization efforts and employee satisfaction. Studies indicate there is no difference between generations of workers seeking the same work life balance, employee development, strong leadership and room to grow within the organization.
In this case, I agree with Main, “the compensation package is the motivating tool to engage the employee to perform.” (Main, et al)
For instance, “compensation is an important HRM practice adopted by an organization for motivating employees towards their works. Kahn (1990) stated that as employees perceive that their organization provides a proper compensation package for their work; their engagement level will be higher.” (Aktar & Pangil, 2018)
REFERENCES
Mello, J. A. Strategic Human Resource Management. [VitalSource Bookshelf]. Retrieved from https://online.vitalsource.com/#/books/9781305203204/
Sarkar, J. (2018). Linking Compensation and Turnover: Retrospection and Future Directions. IUP Journal of Organizational Behavior, 17(1), 43–75. Retrieved from http://search.ebscohost.com.proxy.devry.edu:5050/login.aspx?direct=true&AuthType=url,cookie,ip,uid&db=bth&AN=127994297&site=eds-live
Campbell, L., Smith, P. C., & Martin, K. (2019). Defining ‘Reasonable Compensation’ under the Tax Code. CPA Journal, 16. Retrieved from http://search.ebscohost.com.proxy.devry.edu:5050/login.aspx?direct=true&AuthType=url,cookie,ip,uid&db=f5h&AN=139067122&site=eds-live
Zaharee, M., Lipkie, T., Mehlman, S. K., & Neylon, S. K. (2018). Recruitment and Retention of Early-Career Technical Talent: What Young Employees Want from Employers. Research Technology Management, 61(5), 51. https://doi.org/10.1080/08956308.2018.1495966
Thompson, N.W. 2011. Managing the Millennials: Employee Retention Strategies for Generation Y. CMC Senior Theses, Paper 240. Claremont Colleges. http://scholarship.claremont.edu/cmc_theses/240
