Human Resource Management Assignment 1 Example

Human Resource Management Assignment 1 Example Human Resource Management Assignment 1: â€" Essay Example > Company overview: Airbus UKAccording to Redman and Wilkinson “Airbus UK is a part of a giant European aerospace group EADS and is jointly owned by EADS and British BAE system. It is the only European manufacturer of aircraft. Airbus UK competes with their American manufacturer Boeing, the world’s only other aircraft manufacturer. Airbus has European manufacturing facilities in Germany, France and Spain as well as the UK. In the UK the company operates on two sites: Filton (Bristol) and Broughton (Cheshire). (Redman and Wilkinson, 2006)According to an article published on BBC website “In April 2006 BAE Systems announced its intention to sell its share of Airbus SAS to EADS. BAE originally sought to agree a price with EADS through an informal process. However due to the slow pace of negotiations and disagreements over price, BAE exercised its put option which saw investment bank Rothschild appointed to give an independent valuation. ” (BBC News, 2006)Advantages and disadvant ages of the new reward structureBefore 2001, Airbus was using job based system. In job-based systems, the assumption is made that work gets done by people who are paid to perform well-defined jobs. Each job is designed to accomplish specific tasks and is normally performed by several people. Because all jobs are not equally important to the firm and the labor market puts a greater value on some jobs than on others, the compensation system primary objective is to allocate pay so that the most important jobs pay the most. This is the traditional form of pay system which was used in Airbus before 2001 designing of new reward structure where employees increased their base pay as they were promoted to higher grades in organizational chart. There are three key components of developing job-based compensation plans: Achieving internal equity (job evaluation) based on six steps; Achieving external equity based on market survey andAchieving individual equityJob based-compensation assesses t he relative value or contribution of different jobs to an organization. The first part of this process is known as job evaluation composed of six steps to provide rational, orderly and systematic judgement of how important each job is to firm. In job evaluation the company conducts: job analysis; write job description; determines job specifications; rate worth of all jobs using a predetermined system; create job hierarchy and classify jobs by grade levels. Now in order to achieve external equity company conducts market survey. The purpose of this survey is to determine the pay ranges for each grade level. This is done in order to achieve external equity. Airbus was planning to conduct this survey and benchmark itself against the top notch companies so that the employees are fairly paid as compared to the same ranks being paid in the other companies. After this survey is conducted it has to make strategic choice about whether it will pay the same rate, a lower rate, or a higher rat e. Even though the entire process is performed thoroughly but I believe that the system has many problems. Firstly even though there is capacity in this system to assess the performance of each individual and their ranks and grades are determined according to that but what if the employee has performed well during or before the entire evaluation period. Then how will he will be rewarded or graded for that? I think that in this system the job is considered more, its importance and contribution to the company is given utmost importance and the potential, skills and expertise of the person is not paid, leaving no room behind for better performance and increase productivity level for the employee.