About HR Strategy about Compensation

1. Presented By :
Monica Singh - 13810052
Amar Keshari - 13810008
Rakesh Ranjan - 13810066
Shivani Singh - 13810072
Wrap It Up
Developing a new Compensation Plan

2. Introductio
n
Proble
m
Statem
ent
ShareI
t
Propo
sed
Soluti
on

3. Background
 Shawn Jackson and Simon Sethi
 Northern California, 2002
 Fresh, healthy, locally sourced ingredients
 Consumer preference of quick meal alternatives
 30 restaurants by 2011
 Focus on freshness and special diets
 All stores company-owned
 Passion for delivering fresh quality food

4. Concerns
 Tight relationships with long term employees
 Centralized social media activities
 Disorganized recruiting
 High turnover
 Difficult to attract and retain top talent
 Lack of motivation among managers

5.  Frustration among employees at all levels
 Declining customer satisfaction
 No change in menu
 Regular customers not given any discounts
 Manager turnover
 Inconsistency in menu and service due to local
sourcing

6. Compensation
It is what employee receive in exchange for their contribution
to the organisation.
 Nature of Compensation
a. Base Pay
b. Variable Pay
c. Benefits
 Dimensions of Equity in Compensation Planning
a. Internal Equity
b. External Equity
c. Individual Equity

7. Objective of Compensation Planning
 Attract Talent
 Retain Talent
 Ensure Equity
 New and Desired Behaviour
 Control Cost
 Comply with legal rules
 Ease of operation

8. ShareIt
 For Individual store profits
 Motivation for Managers
 Store Selection for Pilot Program
Comparative Analysis
Store Name Santa Monica Costa Mesa
Location New City Centre Shopping Mall
Experience
Opened in 2004 Opened in 2007

9. Employee Enfranchisement
 Achieved through an integration of empowerment
with methods of pay for performance .
 Participatory management : Encourage employee to
participate in organizational decision making.
 Employees are encouraged to voice their opinions
about their working conditions.
 Such combinations have the potential for producing
extraordinary service.

10. ShareIt Insights
Existing Pay Structure ShareIt Structure
Basic Pay: At Par with the
Industry
Profit = Performance Metric
Variable: Differs w.r.t. amount
and qualifiers
Quarterly Appraisal
Linked to Profits not
Revenue
5 Bands : Revised on yearly
basis
Store Manager : 35% Profit
No pay difference b/w top
and low range of band
Associate Manager : 15%
Profit
No incentive to improve
after band is achieved
WrapItUp :50% Profit
Benefits were Paid one

11. WrapItUp Manager Compensation vs Industry Benchmark

12. Santa Monica Strategy
 Setup a Facebook Page and Twitter account.
 New Menu was designed – “ RepeatIt”
 Offered discount coupons
 Chef appearances and book Signing
Costa Mesa Strategy
 Focused on Cost Reduction
 Renegotiated terms with suppliers
 Substituted with less expensive ingredients

13. Income Statement of Costa Mesa Store before ShareIt

14. Income Statement of Costa Mesa Store during ShareIt

15. Income Statement of Santa Monica Store before ShareIt

16. Income Statement of Santa Monica Store during ShareIt

17. Customer Surveys Report

18. Outcomes Of Steps Taken
Parameters Santa Monica Costa Mesa
Revenues Increased by 10.2% Decreased by
1.45%
Profitability Increased by 24.5% Increased by
21.8%
Working
hours
Increased from
50hours to 70
hours a week
-
Customer
surveys
Mixed results Downgraded
customer
satisfaction

19. Solutions
 Based on these points we observe that the result of
the programme showed improvement in profitability.
Stores have been able to increase their profits and
have been able to increase the incentives for
managers.
 However we opine that the cost containment
approach adopted by the manager at Costa Mesa
would not sustain in long run and would lead to
customer dissatisfaction.
 The employee turnover is bound to increase in this
scenario. We recommend the customer centric

20.  The promotions and new menu items introduced
would add value to customer satisfaction.
 The idea of taking orders through text messages
would further help the store to retain its customers.
 Better customer relationship program should be
introduced. There is no such mention in the case
that how the employees should be motivated other
than giving improved incentives.
 Rework on the compensation plan

21.  There should be some metrics to measure the
employee satisfaction level also. This can lead to
have better satisfied pool of employees which in turn
would yield high profitability with improved customer
satisfaction.
 Reyes should roll out the programme in some other
stores to evaluate how other store managers would
react to the combination of freedom and pressure
that ShareIt program offers.
 Include multiple parameters like revenue and size of

22. Thank You