Abstract
With the development and extensive application of project team work under the matrix organizational structure, the traditional compensation system based on the job-evaluation method has been greatly challenged. The job-evaluation method is designed to compliment functional or divisional structure in a static or at least stationary context, which is often ineffective and even counterproductive in the quick changing environments. This paper is an attempt to design a dynamic compensation model by setting a “project adjusting index” based on the key diversified project features. The objective is to primarily rationalize the firm’s pay structure, and to make project employee could be paid according to their contributions to the organization on the norm of equity.
Highlights
Dynamic compensationHay system appears to employees to be an objective method for finding appropriate compensation levels, thereby lending legitimacy to the firm’s wage structure and heightening perceptions of procedural and distributive justice. (Baron& Kreps,:285) this mode of compensation is quite suitable for those enterprises with stable operation environment, clear organization structure, many divisions of departments or jobs and the relatively stationary or fixed job
We define dynamic compensation system in the project context, which means that the compensation should respond to the diversified features or environment of projects, so that the personal contributions in different projects could be reflected
Compensation system is closely linked with organizational structure (Cheryl Zobal, 1999).One of the most important elements of an ideal compensation system is that it fit with the overall organizational structure or design (Gross, 1995)
Summary
Hay system appears to employees to be an objective method for finding appropriate compensation levels, thereby lending legitimacy to the firm’s wage structure and heightening perceptions of procedural and distributive justice. (Baron& Kreps,:285) this mode of compensation is quite suitable for those enterprises with stable operation environment, clear organization structure, many divisions of departments or jobs and the relatively stationary or fixed job. Hay system appears to employees to be an objective method for finding appropriate compensation levels, thereby lending legitimacy to the firm’s wage structure and heightening perceptions of procedural and distributive justice. (Baron& Kreps,:285) this mode of compensation is quite suitable for those enterprises with stable operation environment, clear organization structure, many divisions of departments or jobs and the relatively stationary or fixed job. The definition of dynamic compensation system is to make the compensation system change with the employee’s performance and market factors. We define dynamic compensation system in the project context, which means that the compensation should respond to the diversified features or environment of projects, so that the personal contributions in different projects could be reflected
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
