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MGT 822 Developing Reward and Compensation Systems


Course Description

Learn how to apply compensation principles to organizational objectives and strategically use compensation systems to attract, motivate and retain employees. You’ll also discover the managerial aspects of paying employees at all organizational levels.

Course Objectives

  • Describe the key strategic considerations an organization must undertake to establish its compensation program and the main elements it has to work with in the design of that program
  • Explain the elements of an effective merit-based pay program and demonstrate the ability to manage and communicate merit-based pay decisions effectively
  • Summarize the key considerations that impact the design of managerial incentive plans, the challenges organizations typically face in implementing those plans, and what they can do to manage those challenges
  • Identify and explain the typical approaches organizations take in the design of long-term incentives, how to value long-term incentives using information from a company’s annual report, and critically evaluate the fit between a particular long-term incentive plan and an organization’s needs
  • State the argument for an intrinsic versus an extrinsic approach to motivation and describe the implications for compensation of each approach

Week 1


Topic: Strategic Compensation Considerations
Lecture: Strategic Compensation

Outcomes

  • Identify the key concepts of strategic analysis
  • Explain the purpose of relative position in the marketplace
  • Recognize how external market environment and internal capabilities affect strategic analysis
Lecture: Organizational Culture and Product Life Cycle

Outcomes

  • Discuss the impact of organizational cultures or product life cycle on strategic compensation
  • Identify the major types of organizational culture
  • Recognize the impact of organizational culture on designing rewards systems
  • Illustrate the major phases of product life cycle
Live Session: Strategic Compensation Considerations

This week's live session will build on and tie together the assigned readings and recorded lectures.


Week 2


Topic: Managing Merit-Based Pay
Lecture: Merit Pay

Outcomes

  • Explain the impact of merit pay on designing reward systems
  • Identify the key features of merit pay
  • Predict the participation rates of merit pay
  • Review the effectiveness of merit pay
Lecture: Internal Consistency: Job Analysis

Outcomes

  • Discuss the key concepts of job analysis
  • Explain the importance of job analysis
  • Identify the key features of job analysis methods
Lecture: Internal Consistency: Job Evaluation

Outcomes

  • Discuss the key concepts concerning job evaluation
  • Analyze the job evaluation process
  • Recognize job evaluation techniques
  • Define the point method
Lecture: External Competitiveness

Outcomes

  • Identify the key concepts on designing market-competitive pay systems
  • Explain the four steps involved in designing a market-competitive pay system
    • Strategic analysis
    • Compensation survey
    • Integrating internal job structures with external market pay rates
    • Compensation policies
Lecture: Constructing Pay Structures

Outcomes

  • Discuss the key concepts on constructing a pay structure
  • Review the five steps involved in constructing a pay structure
    • Deciding on the number of pay structures
    • Determining market pay line
    • Defining pay grades
    • Calculating pay ranges
    • Evaluating the results
Lecture: Designing Systems

Outcomes

  • Identify the several additional key considerations when designing rewards systems
    • Merit pay system
    • Sales-incentive compensation plans
    • Pay-for-knowledge programs
Live Session: Managing Merit-Based Pay

This week's live session will build on and tie together the assigned readings and recorded lectures.


Week 3


Topic: Managing Annual Incentive Plans
Lecture: Merit Pay

Outcomes

  • Assess the performance measures criteria of merit pay
  • Differentiate the approaches to measuring performance of merit pay
  • Summarize the key concepts for effective performance appraisal system
Live Session: Managing Annual Incentive Plans

This week's live session will build on and tie together the assigned readings and recorded lectures.


Week 4


Topic: Managing Long Term Incentive Plans
Live Session: Managing Long-Term Incentive Plans

This week's live session will build on and tie together the assigned readings and recorded lectures.


Week 5


Topic: Managing Rewards and Performance


The course description, objectives and learning outcomes are subject to change without notice based on enhancements made to the course. May 2015