The Executive Handbook on Compensation: Linking Strategic Rewards to Business Performance - Review

HR Magazine, July, 2001

Edited by Charles H. Fay, Michael A. Thompson and Damien Knight Free Press, 2001 860 pages

List price: $125.00

ISBN: 0-6848-4233-5

The evolving economy has prompted employers to re-examine their compensation strategies. Or, at least, it should have. The editors of The Executive Handbook on Compensation point out that while compensation often is an organization's single largest investment, reward strategies seldom keep up with the times.

Edited by Charles Fay, Ph.D., director of Rutgers University's graduate program in HR management, and Hay Group consultants Michael Thompson and Damien Knight, The Executive Handbook on Compensation contains 55 articles by multiple authors. In his introduction, Fay identifies the globalization of the economy as the most significant factor in changing the context in which companies think about compensation. He also notes that changes in workplace demographics and human resource management have affected rewards strategies.

The essays are by HR thought leaders such as David Ulrich and Bruce Ellig, as well as compensation consultants, academicians and HR practitioners. The editors have organized the contents into four parts:

* Business and HR strategies.

* Reward strategies.

* Reward design and implementation.

* Pay systems.

The essays--usually between 10 and 20 pages long--describe how companies can link their HR goals with their business objectives; reward and retain top performers; determine appropriate pay scales; evaluate employee expectations; boost morale; develop nontraditional compensation models; and use technology to improve the way they evaluate, plan and price jobs.

For example, a chapter examining the role rewards play in shaping commitment and motivation recommends that employers take a holistic view of compensation. The authors say it's important to consider the following questions:

* What kind of people do we need to take this business forward?

* What will these people find rewarding?

* What changes are needed in the way we treat people to align business goals, personnel and compensation?

An appendix documenting the patented Hay Guide Chart--Profile Method of position evaluation closes the book.