COMPENSATION AND MANAGING

EMPLOYEE PERFORMANCE

Lilifly - 29118113

Marshall & Gordon: Designing an Effective Compensation System (A)

Overview
Marshal and Gordon is a major international player in the Public Relation (PR)
sector with a number of services including media relations, investor relations, lobbying,
crisis management, fund raising, and event management. As the company’s services, it
has been expanding to some disciplines such as management, finance, marketing, HR,
and management. In addition, the company recently launched Executive Positioning
Practice (EPP) as its way to provide services of positioning the top executives of the
industry in order to build and redefine the brand and positive image of the firm to the
client.
However, The competition in the PR sector has increased. Therefore, it then
created problems for the PR key players to pay attention to their principals, partners,
associates and employees because they could be taken by the competitors to join with
them. In addition, the economic situation which got low has affected negatively to the
firm’s revenues. Thus, the firm has to introduce the new system of compensation to
encourage and motive the employees in order to have a long relation with the company
on mutual benefit. Therefore, the company should adopt an ideal compensation to
address the challenges that it has been facing internally and externally.

Problem Statement
What is the best way to encourage principals, partners, associates other
employees for Marshal and Gordon through the new compensation system that could
motivate individualistic approach and emphasize on the teamwork as well?
Analysis
Marshal and Gordon’s compensation system has generated some problems
because the employees and associates do not have a deal in term of the formula of
sharing reward and bonuses. Not only that, but also the employees and associates
continue to show their dissatisfaction with their efforts that are considered meaningless
and their compensation which is not given in line with their work in the team. The
firm’s system of compensation is more focused on rewarding bonuses to partners and
principals in which the bonuses would be given based on the credits earned by the
consultants regarding to their business originated and executed.
Similarly, the rewards and bonuses could be calculated as per their earned O/E
credits. Since the firm has individualistic culture, in many times, some projects have to
be done by another partner and principal’s assistance, so that they have right for the
reward and bonus’s distribution. Therefore, the company need to have a new
compensation system that can motivate and encourage the individualistic efforts and
teamwork as well in order to sustain the strategic position of the company in the market.
By compensating the top performers of the firm, the possibility of losing a client will
not occur.
As a problem, the system of current compensation has not suitable strategy for
the organization due to lack of connecting all the associates at one page and on the clear
goals and objectives. Therefore, there are three aspects that the company should think
about while set the new compensation system.
 First, the communication should be maintained between the company and
employees to provide information about the system of reward model including its
implementation at different levels as per the factorial analysis regarding to
performance, experience, and efforts in the team. It is important factor to build the
effective compensation in order to avoid confusions and misunderstanding among
employees.
 Second, the monitoring of the new system implementation should be consistent to
make sure that the system already run well and the employees get compensation as
per the model and get promotion and reward on time.
 Third, the evaluation of the application of a new system should be measured based
on a 360 degree assessment that includes company as the system maker and also
 employees as system users. Thus, the company will be able to understand all the
needs and complaints of employees, and also the company can fulfill its obligations
properly.

Recommendation
As the recommendation, Marshal and Gordon should adopt fixed salaries
system for junior employees and new recruitment and should give compensation based
on the experience. In addition, for the top performances, bonuses should be offered for
them and the company should be compensated increasingly in line with the length of
time they have been with the company. Therefore, they would stay longer and more
loyal to the company. So, this would motivate and encourage individualism and team
work as well with full potential. Consequently, to work individually would be
emphasized by the compensation and to work teamwork would be motivated by the
bonuses. Thus, employee concerns will be able to be addressed without making them
have to resign from the company. The essence of this effective compensation system is
a fixed salary, compensation and bonuses that are in line with the hard work of the
employees.

Proposed System
References
Lako, Andreas.2019. Kelayakan Sistem Kompensasi Manajemen untuk Eksekutif.
ResearchGate.
Soerjoatmodjo, Gita W.L. 2019. Kompensasi dan Kinerja Karyawan. ResearchGate.