Wednesday, February 24, 2010

MGMT 3430 Chapter 11

1. Concept and Brief Description

Pay grades are established by companies by grouping similar jobs of worth or content. Each group has a base and also a maximum with regards to the pay structure. However, there are drawbacks to such a structure.

2. Emotional Hook (provocative question/claim/real-life problem)

Let’s suppose you worked for a large commercial construction company that used this form of pay structure. In this structure the company grouped your position, Senior Engineer, with the Senior Project Manager. In the view of the company each has a very important role; each has similar worth to the company. The only problem is the market rate for the engineer is higher than that of the manager. The company pays the same rate for each only because they are in the same pay grade.

• As the Senior Engineer how would knowing this affect your overall satisfaction with the company?

• Would knowing this make you decide to work somewhere else?

3. Key Points to Elicit in Discussion

• Pay grades are taking similar jobs that are such in either worth or content and then placing a general pay scale for that group.

• There can be multiple pay grades with-in a company.

4. Facilitative Questions

• How can a company know that the pay grades they have created are correct?

• How can knowing the pay grade for your position affect your performance?

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