Issue and Opportunity Identification
Several employees have recently complained that they are underpaid and have expressed the need to have their salaries revised. In fact, some employees, especially within the IT department, have been approached by recruiting firms which seem to be offering much more competitive salaries. As for the R&D department, there is also a strong concern that they might loose several key product engineers to other companies that also offer much more competitive salaries.
Riordan has been given the opportunity to hear what their employees are saying and feeling and then conduct several industry and benchmarking studies to determine the root cause of these issues. By examining the organization’s “external competitiveness” (Dreher and Dougherty, 2001, p.80) and then comparing internal job roles to the market, Riordan will be able to better evaluate the need for possible adjustments. This will also allow Riordan to reach a fair compliance level as it relates to their internal pay system by conducting benchmarking studies and administering pay surveys to obtain “comparative market data” (Dreher and Dougherty, 2001, p.80).
There have also been several complaints towards the fact that pay and compensation are not necessarily linked to performance but more to seniority. In certain cases, performance reviews aren’t even being conducted as this has led to a great deal of unfairness and inconsistency within the organization. Riordan needs to rethink and redesign its rewarding and compensation process in order to maintain fairness and consistency amongst its employees while rewarding individual performance. By maintaining “internal consistency” (Dreher and Dougherty, 2001, p.82) and enforcing a robust “performance-contingen ...