Sample Business Studies Paper on Foundations of a Compensation Strategy

Foundations of a Compensation Strategy


            A compensation strategy for a link between the management and the employee pay and benefits (Aswathappa & Dash, 2008). When developing a compensation strategy, there are many tenets that need to be considered (Aswathappa & Dash, 2008). However, for the scope of this paper, three of them: job description, performance evaluation, and salary comparison, will be discussed. Therefore, the aim of this paper is to examine the three identified components and illustrate using an example of a well-known position.

Evaluation of the three Components of Compensation Strategy

Job Description

            A job description aids the HR team to understand better the experience and skill base that is pertinent to achieving the success of an organization. This description is a communication point with a potential employee of the tasks that they are going to undertake, the necessary skills required and the person they will be reporting to (Aswathappa & Dash, 2008). It interconnects with performance measurement in that; it gives a sneak peek of the evaluation mechanisms. It is also interrelated with the external, and internal salary comparison in that, a range of specific figures are given to offer flexibility (Aswathappa & Dash, 2008). Obviously, the figure is given after an evaluation of all interrelated positions in the organization. In companies where job grades are applicable, the job description outlines the scale.

Performance Evaluation

            Performance evaluation follows the job evaluation that outlines the knowledge, skills and abilities (KSA). Based on the KSAs, managers can evaluate the success of an employee in a given position (Aswathappa & Dash, 2008). The management is, therefore, able to rate the employee. If an organization approves that as part of salary review process then there must be some internal as well as external comparisons. The comparison happens, so as not to under review or over the review the salary based on the budgetary allocation (Aswathappa & Dash, 2008).

Internal and External Salary Comparison

            The current labor market is very competitive that comparisons of salaries need to be frequently made. The internal comparison is based on a position that is either in the same job scale, department or has the same job description in an organization (Aswathappa & Dash, 2008). External salary comparison, on the other hand, compares what the industry offers for a given position and aids in making a position competitive in an organization (Aswathappa & Dash, 2008). The two forms of salary comparison are intertwined with job description and performance evaluation in that the best employee always takes a good share of the money home (Aswathappa & Dash, 2008).

Salary Evaluation for a Client Manager

Job Description

            The client manager works with other departments in meeting business sales and revenues. They also design plans to achieve set objectives and create strategies to prevent revenue loss. Connect the clients and the products and services. They also inform the company of possible contracts and new marketing opportunities to consider.

Organizational Performance Evaluation system

CommentPointsPercentage Increase
Extremely good75
Above Average52
Below Average30
Extremely poor10

External Salary Survey

            The annual salary range is from $3350 to $8, 860 (, 2015).

Internal Salary Comparison

            The client manager position is similar to the public relations manager position, and should be paid within the same monthly salary range of $5,784 – $10,264 (, 2015).


             As seen in the paper, there is an interrelationship between the three components of a compensation strategy. As can be seen in the paper, the sample illustrates that different companies may have different evaluation and salary review methods. However, through external comparison a close figure should be estimated for use.


Aswathappa, K., & Dash, S. (2008). International human resource management: Text and cases. New Delhi: Tata McGraw-Hill Pub. (2015). Client Manager: Job Description, Duties and Requirements. Retrieved from