Imagine that you manage human resources for a small business. You have recently prepared a report on the market rate of pay for salespeople, and the company's owner says the market rate is too high. The company cannot afford this level of pay, and, furthermore, paying that much would cause salespeople to earn more than most of the company's managers.
Why is this a problem? Should managers automatically be at the top of the pay scale?
Suggest three possible measures the company might take to help resolve this conflict.
Full Answer Section
Should managers automatically be at the top of the pay scale?
No, managers should not automatically be at the top of the pay scale. The pay of a manager should be based on their skills, experience, and responsibilities. If a salesperson's skills, experience, and responsibilities are more valuable to the company than a manager's, then the salesperson should be paid more.
Three possible measures the company might take to help resolve this conflict:
- The company could offer salespeople a commission or bonus structure that would allow them to earn more money if they meet or exceed sales goals. This would allow the company to pay salespeople more without having to increase their base salaries.
- The company could create a new position, such as "senior manager," that would pay more than the current manager position. This would allow the company to pay salespeople more without having to increase the salaries of all managers.
- The company could offer salespeople more benefits, such as health insurance, paid time off, or a retirement plan. This would allow the company to attract and retain salespeople without having to increase their salaries.
It is important to note that there is no one-size-fits-all solution to this problem. The best solution will vary depending on the specific circumstances of the company. However, the three measures listed above are some possible options that the company could consider.
Sample Answer
here are some possible answers to your questions:
Why is this a problem?
There are a few reasons why this could be a problem. First, it could lead to morale problems among managers. If salespeople are earning more than managers, it could make managers feel undervalued and underpaid. This could lead to decreased productivity and motivation among managers.
Second, it could lead to problems with recruiting and retaining salespeople. If salespeople can earn more money elsewhere, they may be more likely to leave the company. This could hurt the company's bottom line and make it difficult to meet sales goals.