Ms Vivi Gusrini Rahmadani

She is a lecturer at University Sumatera Utara majoring in Industrial and Organizational Psychology and finished her Ph.D. in Work and Organizational Psychology at KU Leuven, Belgium, and published her dissertation report on Engaging leadership. She is also an HR consultant and did her MA in Industrial and Organizational Psychology, from UniversitasGadjahMada, Indonesia. Some of her key publications are engaging leadership and work engagement as moderated by “diuwongke”- an Indonesian study in International Journal of HRM, Engaging leadership and its implications in work engagement outcomes at the individual and team level and Basic Psychological need satisfaction mediates the relationship between engaging leadership and work engagement.

Abstract/Snapshot: The session started at 11.00 am with a formal welcome note by the Head of the department, Dr. Savitri Jayant. Ms. Jovita gave the formal introduction of the guest speaker who then took over the session.

Learnings from the event: The session started with an overview of Motivation and Compensation. She started with the topic of motivation- both intrinsic and extrinsic, followed by the Motivation model comprising of need, behavior, rewards, and feedback.

She explained the various types of compensation strategies that are used to motivate employees to a higher level of performance. E.g. Maslow’s hierarchy of needs- Physiological needs, safety needs, Belongingness needs, esteem needs, and lastly self-actualization needs.

She explained that compensation can be linked with intrinsic and extrinsic psychological and motivational factors. She explained the four factors that are directly linked with Compensation

  • Focus
  • Attraction
  • Retention
  • Motivation

She very nicely described the strategic decisions and compensation practices keeping in mind strategic decisions like competitive strategy, Human resource strategy and compensation strategy, General Tactical HR decisions and specific Tactical HR decisions, and how new role topic of Compensation as a strategic business partner is emerging and this answers three questions.

  1. What are the competitive business strategy options?
  2. Does the choice and design of compensation practices fits well with compensation strategies
  3. Does the implementation of compensation directly effects employee behaviour to enhance job performance

She briefed the various factors which lead to employee dissatisfaction like poor pay, poor compensation, poor working conditions, lack of promotions, poor benefits offering and lack of job security and also the factors like- good leadership practices, recognition, personal growth that leads to satisfaction.

She explained the difference between compensation, benefits, and incentives. Some of the employee benefits and perks include- Health insurance, dental insurance, life insurance, retirement plan, fitness, vision care, sick leaves, child care, etc. She also told how the companies have to redesign their compensation strategy accordingly to baby boomers, Generation X, Generation Z, and millennials

She, later on, explained the concept of EQUITY- i.e. employees expect a fair return for what they contribute to their job and explained Adam’s Equity theory in detail. The structure of equity which can be both intrinsic and extrinsic equity in the workplace is based on the ratio of inputs to outcomes which is again perceived into two categories- inequity and equity.

She went ahead and spoke about what shapes Internal Equity- which can be external factors, organizational factors, and internal structure. She stated that fairness in pay is ensured by using job ranking, job classification, level of management, level of status but again difference in salary may be based on education, experiences, tenure, and level. Similarly, external equity depends on – Labour market factors, product market factors, and organizational factors.

She then explained the types of strategy- Lowest cost strategy, differentiation strategy. She also classified the various pay programs and their purpose namely

  • Pay for performance
  • Gain sharing
  • Employee stock ownership plan
  • Lump-sum bonuses
  • Pay for knowledge
  • Flexible work schedule
  • Term based compensation
  • Lifestyle awards

She explained the factors to set the pay systems-

  • Competitive analysis
  • Cost of living
  • Labour negotiations
  • Personal qualifications
  • Supply and demand of labour

Lastly, she explained about engaging leadership and how they should work with HR to implement a plan that ties the compensation plan to successful recruitment, training, and development plan which will ensure implementation of the strategic objectives.

The session ended with a Q & A segment. Some of the questions asked by the students were:

Ques1- Are there any extra compensation strategies to save the minorities like LGBTQ?

Ques 2-What is the role of self-appraisal of the employees to decide their career improvement/promotion be decided by the management?

Ques 3-What is the most critical component in framing the Compensation and Benefits that make it challenging?

Ques 4-What do you think is the role of a team leader in pushing a compensation package for its team to next best level?

Ques5- What is the factor that determines the fixed pay and variable pay in a compensation package?

Ques6- How can companies redesign their compensation package that fulfill the needs of millennials?

Ques7- If an employee is working for a long tenure and one is working for a short tenure but is working more effectively, then the pay should be tenure-based or performance-based?

Feedback from students: The session was very exciting as it linked Compensation with Motivation and Leadership. The speaker explained the concept with relevant theory and models pertaining to the same

Photos from the event:

About ISBR:

ISBR Business School, Bangalore-based, Top Class B School for PGDM or MBA, Consistently ranked as best B School in India, AICTE-CII Platinum Catagory, with multiple specializations.