Revitalizing Employee Retention Through an Effective Compensation and Benefit Strategy at Holland Enterprises

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Revitalizing Employee Retention Through an EffectiveCompensation and Benefit Strategy at Holland EnterprisesImagine you have been hired as a human resources consultant to revise the compensation andbenefit system for Holland Enterprises, a company that has seen a 25% employee attrition ratedue to dissatisfaction with its current compensation strategy. Prepare a proposal addressing thefollowing:How does an effective compensation and benefit system contribute to the overalleffectiveness of an organization?What are the key components you would include in a revised compensation and benefitsystem for Holland Enterprises? Provide recommendations for each component.Convince top management to increase the company's compensation and benefit expensesby demonstrating the long-term benefits.(Words 1000-2000)

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Compensation and benefit system2Attracting and retaining the most talented employees is essential for long-termorganizational success. An important component to attracting and retaining suchemployees is the design and implementation of an effective compensation and benefitsystem.Assume the role of a highly regarded human resource consultant hired to review,analyze, and revise the compensation and benefit system utilized by your city’s largestemployer, Holland Enterprises. The firm employs 3,500 employees, but since 2007 haslost 25% of its staff. Exit interviews indicate the primary reason a majority of theseemployees have resigned is because of a compensation and benefit system that isperceived to be unfair and uncompetitive in the marketplace.Present to the management a revised compensation and benefit strategy. Yourproposal should include a discussion of:How an effective compensation and benefit system contributes to organizational effectiveness.The principle components of your revised compensation and benefit system for a large-scale organization aswell as a recommendation for each component.A convincing argument to the already skeptical top managers of this organization to increase theircompensation and benefit expenses.At a minimum, your compensation and benefit system would include the followingcomponents:Compensation and benefit philosophyPay structure architecture (pay grades, pay ranges, and pay width)Ratio of base pay to incentive (bonus) payEmphases on external equity or internal equityPrinciple type of benefits to include (example: deferred compensation match, health insurance, vacation andsick leave, etc.)Compensationis the amount paid in lieu of a service or anything from a person.Compensation isa term everybody is familiar with. This term denotes the payment in lieu of the work done. Thecompensation depends on so many other factors and those are, the type of work done, the effort

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Compensation and benefit system3involved in it, the quality of the work done, the policy of the organization or the local standards,the job designation and responsibilities covered, the experience of the individual etc. Basically itis also perceived as payment but it also acts as a tool of motivation for the employees. Thecompensation plays a very important role in today’s world.Compensation is paid to someone who has given something to you. In terms of organization,compensation is the amount the employer gives to the employee in lieu of the work done by theemployee.The compensationisdecided invariousways, such as the market trend, thecompetition of close substitutes,the experience of the employee, the job description, theresponsibilities he/sheis expected to fulfillin his job etc.Compensation and other benefits ofcompensationhelpthe employee in various ways of motivation and alsohelpin the retention ofthe employees. Employee benefits are also a form of compensating the employees for the workthey do in the organization.Thesis statement-“It is the biggest deal for the organization to decide over the compensation andthe benefits of the employees.Compensationcan act in various ways. Motivation, retention,attrition etc can be some consequences of compensation. A paid benefit canretain the employeeor canlead to the attrition of the same. This is themain and the direct link between employeemotivationsalso.”The problem with thiscompany i.e. Holland Enterprises is that the policy it has adopted forcompensation seems to have a serious issue and that is why the attrition of the employeeshaveincreasedterrifically.Thecompanyseriouslyneedstorevisethestrategiesintermsofcompensation to retain its employees to a longer extent.The revision of compensation policy

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