SlideShare a Scribd company logo
2
Most read
Bank West Corporation Candis Tweeddale and Ken Aitchison
Contents Facts What strategies would we propose How would we make the compensation system fairer, commutative and a drive change? Would we change the company’s philosophy to do the right thing for the shareholders? Summary
Facts: -  Bank of the West The merger of the Bank of the West and 1 st  Hawaiian created BancWest  the 10 th  largest bank holding company in the U.S. BancWest’s holding company is a wholly owned subsidiary of French bank BNP Paribas Compensation Philosophy (during and immediately after merger) No direct linage between performance and compensation Focused on retaining key employees
Facts (cont’d) Adjusted Compensation Philosophy Less entitlement based Tied more closely to how well the company and individual employee’s perform Leanest, best performing company Competitive base pay, performance-based compensation Targeted to the top quartile of the market
What strategies would we propose? Targeting salaries at top quartile of the market If overall compensation for your employees is in the top quartile in your industry what does that get you? Strong incentive for employees who will want to retain their high-paying job They are more likely to provide greater work effort Higher wage makes job loss more costly to employee Above market wage can enhance employee productivity, so that higher wage could pay for itself Lower supervision costs: with less incentive among employees to “lay down on the job” , the company would need fewer supervisory personnel to monitor employee performance. This too can lower the company’s overall wage cost.
What strategies would we propose? Reduced job turnover: the  above market  pay discourages workers from voluntarily leaving their jobs. The lower turnover rate reduces the company’s costs of hiring and training workers. It also gives the company a more experienced, more productive work force. A strategy that calls for  above market  pay can contribute to the feeling in the organization that it is an elite organization, that people must be competent to work there, and that they are indeed fortunate to be there.
What strategies would we propose? Hiring quality workers, demanding “ above market ” performance Hire slow, fire fast “ We will hire five people to do the work of 10 and pay them like seven”, communicates an  above market  pay practice closely tied to demanding performance standards. Develop culture to go along with compensation philosophy David Brandon, CEO of Domino's “ You can’t overcome a bad culture by paying people a few bucks more” Ensure Job Descriptions, Job and Performance Expectations are understood and communicated up and down the organization.
How would you make the compensation system fairer, commutative, and a drive change? Get input and assessment into the strategy from various sources when setting up the design of the compensation plan Employee input and Preferences Strategic Business and Operating Inputs Industry & Labor Market Practices and Trends
How would you make the compensation system fairer, commutative, and a drive change. By following this input/assessment process the company will: Get easier buy in and agreement from employees Make sure management concerns are addressed Market trends are not ignored Communicate, Communicate, Communicate Follow Through
Would you change the company’s philosophy to do the right thing for the shareholders? Short Term vs. Long Term Balance between the business and shareholders interests
Summary When involved in a merger figure out what your compensation philosophy during all stages of the merger. Make sure it is communicated up and down the organization Make sure the company culture supports the compensation philosophy. Use various resources to help design the compensation strategy and plans. Follow through

More Related Content

PPTX
Compensation Management
PPTX
Concept of reward and total reward system
PPT
Compensation management
PPTX
Executive compensation
PPTX
Compensation practices
PPTX
Wage differentials (compensating Differentials)
PPTX
Compensation Management importance and factors influencing compensation
PPTX
Employee Attrition
Compensation Management
Concept of reward and total reward system
Compensation management
Executive compensation
Compensation practices
Wage differentials (compensating Differentials)
Compensation Management importance and factors influencing compensation
Employee Attrition

What's hot (20)

PPTX
Placement and induction in HRM
PPTX
Human Resource Management Practices in japan
PPTX
Compensation policy of tata consultancy services
PPTX
Compensation
PPT
Compensation management
PPT
fringe benefit
PDF
Compensation management
PPTX
Expatriate Compensation
PPTX
Pay structure: Grades & Ranges
PPTX
training & development ppt
PPT
Compensation
PPTX
Human Resource Management: Reward and compensation
PPTX
Employee benefits and services
PPTX
Linking performance to pay
DOCX
Hrm case study 2
PPTX
Trade unions in india
PPTX
Compensation plan In HRM
PPTX
Employee compensation and benefits
PDF
Promotion, Transfer And Seperation
PPTX
Employee Engagement
Placement and induction in HRM
Human Resource Management Practices in japan
Compensation policy of tata consultancy services
Compensation
Compensation management
fringe benefit
Compensation management
Expatriate Compensation
Pay structure: Grades & Ranges
training & development ppt
Compensation
Human Resource Management: Reward and compensation
Employee benefits and services
Linking performance to pay
Hrm case study 2
Trade unions in india
Compensation plan In HRM
Employee compensation and benefits
Promotion, Transfer And Seperation
Employee Engagement
Ad

Viewers also liked (14)

DOCX
INTERNATIONAL OPERATION MANAGEMENT
PPTX
Eva And Compensation Management System At Tata Consultancy
PPTX
Study of Performance and Compensation at Infosys Ltd.
PDF
case study of Nestle comapny
PPTX
Toyota compensation
PPTX
Global operations management
PPT
Competency mapping
PPTX
Compensation Management
PPT
Competency mapping
PPT
Competency mapping ppt
PPTX
Compensation management
PPTX
Workers’ participation in management
PPT
Advertising research
PPTX
Compensation ppt
INTERNATIONAL OPERATION MANAGEMENT
Eva And Compensation Management System At Tata Consultancy
Study of Performance and Compensation at Infosys Ltd.
case study of Nestle comapny
Toyota compensation
Global operations management
Competency mapping
Compensation Management
Competency mapping
Competency mapping ppt
Compensation management
Workers’ participation in management
Advertising research
Compensation ppt
Ad

Similar to Compensation Case Study (20)

PPTX
7 Signs You Need a Compensation Consultant
PPT
Pay Structure Decisions
PDF
Compensation, 14e ISE 14th/ISE Edition Barry Gerhart - eBook PDF
PDF
Webinar - How to Craft a Winning Compensation Strategy
PDF
Compensation pdf
PDF
The Pitfalls of Linking Pay With Performance and How To Overcome Them
PPTX
COMPENSATION and BENEFITS.pptx
PDF
Compensation, 14e ISE 14th/ISE Edition Barry Gerhart
PDF
Compensation, 14e ISE 14th/ISE Edition Barry Gerhart
PDF
4 Measures of a Successful Pay Strategy
PPTX
How to Transform Entitlement into Stewardship
PPTX
Chap 2 Strategy the totality of decisions
PPT
Reward strategyinpracticelloydstsb presentation18se
PDF
Pay, Performance & Productivity
DOCX
Instructions Answer discussion questions number one and two. Resp.docx
PPTX
Human resource management chapter 11 ( Pay Structure Decision )
PDF
Decoding Total Rewards
PPTX
Gp9 ch19 final
PPT
Chapter 09 Managing Compensation
DOCX
SHRM Building Compensation Systems
7 Signs You Need a Compensation Consultant
Pay Structure Decisions
Compensation, 14e ISE 14th/ISE Edition Barry Gerhart - eBook PDF
Webinar - How to Craft a Winning Compensation Strategy
Compensation pdf
The Pitfalls of Linking Pay With Performance and How To Overcome Them
COMPENSATION and BENEFITS.pptx
Compensation, 14e ISE 14th/ISE Edition Barry Gerhart
Compensation, 14e ISE 14th/ISE Edition Barry Gerhart
4 Measures of a Successful Pay Strategy
How to Transform Entitlement into Stewardship
Chap 2 Strategy the totality of decisions
Reward strategyinpracticelloydstsb presentation18se
Pay, Performance & Productivity
Instructions Answer discussion questions number one and two. Resp.docx
Human resource management chapter 11 ( Pay Structure Decision )
Decoding Total Rewards
Gp9 ch19 final
Chapter 09 Managing Compensation
SHRM Building Compensation Systems

Recently uploaded (20)

PPTX
Lecture (1)-Introduction.pptx business communication
PDF
NISM Series V-A MFD Workbook v December 2024.khhhjtgvwevoypdnew one must use ...
DOCX
unit 1 COST ACCOUNTING AND COST SHEET
PDF
How to Get Funding for Your Trucking Business
PPTX
Probability Distribution, binomial distribution, poisson distribution
PDF
IFRS Notes in your pocket for study all the time
PDF
Ôn tập tiếng anh trong kinh doanh nâng cao
PDF
pdfcoffee.com-opt-b1plus-sb-answers.pdfvi
PPTX
job Avenue by vinith.pptxvnbvnvnvbnvbnbmnbmbh
PDF
Laughter Yoga Basic Learning Workshop Manual
PDF
SIMNET Inc – 2023’s Most Trusted IT Services & Solution Provider
PPT
340036916-American-Literature-Literary-Period-Overview.ppt
PDF
Roadmap Map-digital Banking feature MB,IB,AB
PPT
Chapter four Project-Preparation material
PDF
Deliverable file - Regulatory guideline analysis.pdf
PPTX
Dragon_Fruit_Cultivation_in Nepal ppt.pptx
PDF
BsN 7th Sem Course GridNNNNNNNN CCN.pdf
PDF
Tata consultancy services case study shri Sharda college, basrur
PPTX
CkgxkgxydkydyldylydlydyldlyddolydyoyyU2.pptx
PPTX
2025 Product Deck V1.0.pptxCATALOGTCLCIA
Lecture (1)-Introduction.pptx business communication
NISM Series V-A MFD Workbook v December 2024.khhhjtgvwevoypdnew one must use ...
unit 1 COST ACCOUNTING AND COST SHEET
How to Get Funding for Your Trucking Business
Probability Distribution, binomial distribution, poisson distribution
IFRS Notes in your pocket for study all the time
Ôn tập tiếng anh trong kinh doanh nâng cao
pdfcoffee.com-opt-b1plus-sb-answers.pdfvi
job Avenue by vinith.pptxvnbvnvnvbnvbnbmnbmbh
Laughter Yoga Basic Learning Workshop Manual
SIMNET Inc – 2023’s Most Trusted IT Services & Solution Provider
340036916-American-Literature-Literary-Period-Overview.ppt
Roadmap Map-digital Banking feature MB,IB,AB
Chapter four Project-Preparation material
Deliverable file - Regulatory guideline analysis.pdf
Dragon_Fruit_Cultivation_in Nepal ppt.pptx
BsN 7th Sem Course GridNNNNNNNN CCN.pdf
Tata consultancy services case study shri Sharda college, basrur
CkgxkgxydkydyldylydlydyldlyddolydyoyyU2.pptx
2025 Product Deck V1.0.pptxCATALOGTCLCIA

Compensation Case Study

  • 1. Bank West Corporation Candis Tweeddale and Ken Aitchison
  • 2. Contents Facts What strategies would we propose How would we make the compensation system fairer, commutative and a drive change? Would we change the company’s philosophy to do the right thing for the shareholders? Summary
  • 3. Facts: - Bank of the West The merger of the Bank of the West and 1 st Hawaiian created BancWest the 10 th largest bank holding company in the U.S. BancWest’s holding company is a wholly owned subsidiary of French bank BNP Paribas Compensation Philosophy (during and immediately after merger) No direct linage between performance and compensation Focused on retaining key employees
  • 4. Facts (cont’d) Adjusted Compensation Philosophy Less entitlement based Tied more closely to how well the company and individual employee’s perform Leanest, best performing company Competitive base pay, performance-based compensation Targeted to the top quartile of the market
  • 5. What strategies would we propose? Targeting salaries at top quartile of the market If overall compensation for your employees is in the top quartile in your industry what does that get you? Strong incentive for employees who will want to retain their high-paying job They are more likely to provide greater work effort Higher wage makes job loss more costly to employee Above market wage can enhance employee productivity, so that higher wage could pay for itself Lower supervision costs: with less incentive among employees to “lay down on the job” , the company would need fewer supervisory personnel to monitor employee performance. This too can lower the company’s overall wage cost.
  • 6. What strategies would we propose? Reduced job turnover: the above market pay discourages workers from voluntarily leaving their jobs. The lower turnover rate reduces the company’s costs of hiring and training workers. It also gives the company a more experienced, more productive work force. A strategy that calls for above market pay can contribute to the feeling in the organization that it is an elite organization, that people must be competent to work there, and that they are indeed fortunate to be there.
  • 7. What strategies would we propose? Hiring quality workers, demanding “ above market ” performance Hire slow, fire fast “ We will hire five people to do the work of 10 and pay them like seven”, communicates an above market pay practice closely tied to demanding performance standards. Develop culture to go along with compensation philosophy David Brandon, CEO of Domino's “ You can’t overcome a bad culture by paying people a few bucks more” Ensure Job Descriptions, Job and Performance Expectations are understood and communicated up and down the organization.
  • 8. How would you make the compensation system fairer, commutative, and a drive change? Get input and assessment into the strategy from various sources when setting up the design of the compensation plan Employee input and Preferences Strategic Business and Operating Inputs Industry & Labor Market Practices and Trends
  • 9. How would you make the compensation system fairer, commutative, and a drive change. By following this input/assessment process the company will: Get easier buy in and agreement from employees Make sure management concerns are addressed Market trends are not ignored Communicate, Communicate, Communicate Follow Through
  • 10. Would you change the company’s philosophy to do the right thing for the shareholders? Short Term vs. Long Term Balance between the business and shareholders interests
  • 11. Summary When involved in a merger figure out what your compensation philosophy during all stages of the merger. Make sure it is communicated up and down the organization Make sure the company culture supports the compensation philosophy. Use various resources to help design the compensation strategy and plans. Follow through