Organization experiencing challenges with its compensation and benefit Research Paper

Organization experiencing challenges with its compensation and benefit system - Research Paper Example This research paper describes the compensation practices undertaken in organizations have far reaching effects on the competitive advantage of the firm. In order to develop competitive advantage of a firm in the global market, the compensation plans developed by the firm must align with the strategic plans and actions of the same. Apart from the attainment of competitive advantage compensation practices also have influence over recruitments, turnover, productivity of labour, etc. in firms. Thus it is crucial that firms make thorough analysis of how people perceive about the firm’s compensation and how these perceptions consequently affect their behavior. A substantial amount of job satisfaction of employees depends on the amount of compensation that he receives as well as the benefits he derives from the organizations. The financial compensations complemented with adequate benefits such as insurances, sick leaves, paid vacations, discounts, pension plans etc. impacts on the sa tisfaction level of employees and subsequently their behavior and commitment towards the same. The American Airlines (AA) confronted with serious compensation and benefit issues due to the restricting of their compensation plans for employees. Due to the great losses incurred by American Airlines, one of the world’s largest airlines, the management had to undertake massive cost cutting and restructuring campaign with the purpose of restoring profitability. This resulted in massive job cuts of employees. The policy only invited random resistance from employees which further aggravated the amount of losses incurred by the company. ... The problem would be supported by presentation of critical literature which would include various arguments presented by researcher, practitioners and author and also empirical evidence on the subject. Thesis statement Following is the thesis statement developed for the study; Due to the critical role played by compensation and benefit plans on employees’ job satisfaction, commitment and productivity, companies need to strive to exploit full potential of their human resources through adequate compensation and benefit structures. Review of the Literature As organizations continue to be confronted with increased competitive pressures, they seek to achieve more using fewer resources. Along with the rise in emphasis on such aspects as sales volume, innovation, profits, quality etc, many cases have revealed tight control over employments with substantial employment cuts. The idea to manage human resources effectively using fewer employees has evolved over the years. Subsequently th e emphasis has shifted towards the system of employee compensation with the view to manage human resources better (Gerhart, Minkoff & Olsen, 1994, p.1). Employee compensation and benefits play a key role as it lies at the heart of employment relationships having critical importance for both employers and employees. The financial compensation paid by employers in the form of salaries and wages comprises of the main income of the employees. On the other hand benefits account for the health and other security of employees. A large proportion of employee’s job satisfaction and performance depends on the combination of both the compensation and benefits he receives. From the perspective of the employer, the compensation decisions undertaken influences the costs associated with doing the

Real Estate Development, Construction, Economy Thesis

Real Estate Development, Construction, Economy - Thesis Example The correlation of real estate, construction and economy is so big that a downfall in the industry can jeopardize the whole economy for years. Japan has faced it in the eighties and economies of USA, Britain and many other are facing today. The real estate and construction sectors combined had of late been a booming business all over the world and make up one of the largest business segments in the U.S. economy. Real estate development takes place in three major areas: Residential, Commercial and industrial. In residential segment consumers are encouraged to buy houses on account of low interest rates prevailing in the market, Sub-prime lending, lower return from other segments or stock market investment. Home owners are interested in remodeling old houses that is also part of construction industry real estate According to 'The Economist' the total asset in residential property in developed economies was worth $48 trillion and in commercial property worth $14 trillion in 2002. This was 54% of the total assets in two classes of assets, Property and financial.1.(Wikipedia) From the sources of Bank of International Settlement and wall Street journal it has been found that over three years from 2001-2004 housing values have moved up 63% in Spain, 48% in France, and nearly doubled in South Africa. In single year in 2004 prices have rises 48% in Bulgaria, 19% in Hong Kong and scaled up in China, UK, Australia and India. 2. (Global Real Estate Boom) Real estate prices had unprecedented rise for so long and so fast in many countries of the world-America, Britain, Australia, France Spain, and China. Rising property prices helped to prop up the world economy after the stock market bubble burst in 2000" According to estimates by The Economist, over the last five years the total value of residential property in developed economies has gone up by more than $30 trillion. Over the past five years, to over $70 trillion. This is an increase of about 100% of the combined GDP of those countries. This dwarfs any previous house-price boom. It is larger than the global stock market bubble in the late 1990s or America's stock market Real Estate Dev..3 bubble in the late 1920s (55% of GDP). It is perhaps going to be the biggest bubble in history. There is a definite comparison between the real estate bubble of Japan in 1989 and that of 2005 in USA/UK Real Estate bubbles are created from time to time in some countries at certain intervals though it is not fixed and not forecast able. It occurred in 1920, 1980 and again they are threatening to raise heads in 2007-08 in USA, UK China and some more countries. This time the house prices have been rising up for long. More than 25% of homes bought in USA and UK are for investment purpose not for owner occupation showing that the investment in housing is for speculative motive. Majority of first time buyers did not make any down payment for the loan sanctioned. The home prices in most of countries have gone