The Influence Of Human Resource Management Essay


Discuss about The Influence of Human Resource Management.



The following report contains an analysis of the article based on the compensation system of Samsung and how it is monitored and evaluated in the company(Jain &Gautam, 2016). The nature of pay structure must go through a properly defined function in an organization. This particular article highlights the compensation structure of Samsung. The compensation program of the company is should represent a proper core characteristics of the company. The report here also highlights the relevance of a review of reward structure of the company. Performance based, profit based, gains based, merits based compensation system. The government regulation of the management system is also highlighted as per the need of the article.


The main objective of this research is to analyze and evaluate the compensation management structure of Samsung. The article also gives insights to this management system. The motivation and rewards system is also part of this system. The reflection of the compensation article is also given in this discussion. The objective also includes the recommendation regarding faults of the system.


The purpose of this report is to analyze the compensation management system of Samsung. Their main motive is to review the contributing factors of compensation management system.


The scope of reviewing the process lies in the utilization of the knowledge of performance management system as well as the compensation management system in the organization that I will work on. It will also help me in the future.

Reflection Of Performance Management On Strategic HRM

The organizations are dependent on the resources they use to fulfill the main vision that they abide by. Employees are one of the main resource that should be considered carefully to deal with. HR departments of the companies are in positon to utilize the human resources(Jain &Gautam, 2016). The strategic utilization of the human resource involves developing a proper human resource structure, recruitment, training and development, managing workforce and workspace, retention, and compensation management. The major motivation comes from the compensation that the individuals do. To properly achieve the compensation most of the companies, abide a structure that indicates the main criteria of the company. This is backed up by the performance management system(Jain &Gautam, 2016). The higher productivity and lesser scrap rates and lower turnover rates indicates a proper performance management system.

Performance management system is one of the most important. Pay structure, pay level and job structure must abide by the equity and fairness theory of pay policy(Harun, Shahid& Othman, 2016). The main criteria for the company is to build a structure for the performance management and provide fair compensation for their employees. According the criteria of the performance and labor market and regional pay structure also must be followed(Jain &Gautam, 2016). The main problems in the job based pay structure rather than market based pay structure is to move with the trend. The communication and participation are main role of the company that changes with the designing problem of the pay program.

The Key Elements Of An Effective Compensation Strategies Are

  • Budget allocation strategy should be properly aligned with the salary benefits of the organization. The strategy should not be used in the proper manner that the compensation budget includes the benefits and incentives (Yaseen&Maheen, 2017). Allocating a specific budget contributes to strategic human resource management in the company.
  • Developing salary ranges is also a major part of the employee compensation plan. Thus HR resources uses to overview the market trend of compensation scale. Therefore, HR conducts a research regarding development of ranges in the company (Yahya& Tan, 2015).
  • Salary auditing of the company with respect to performance management is also part of the compensation management system of the company. Employers are the most important part of external and internal stakeholders those who are part organizations The market trend is one of the most important factor to be considered in the system. The loss of valuable employees may affect the competitive position of the employees.
  • Benefit packages should be used and in addition to the salary to both attract and retain the employees. Thus the goal is to alleviate the health of organization and nurture the work culture of the employees. Therefore, it would help organizations to build a brand through differentiating their identity among the employee domain(Yaseen&Maheen, 2017).
  • Performance management is one of the most important objective that should be analyzed in an employee rewards and compensation strategy(LongAjagbe&Kowang, 2014). Annual goals and annual performance appraisals are one of the essential part of employee productivity.
  • The legal compliance of the compensation strategy should be transparent in an organization. The minimum wage and overtime pay fair pay should also be considered in the system.
  • The structured administration of the business process, salary audits, review process, employee engagement, hiring process is part of the administrative staff in an organization. The expectations to managing performance systems must be effective to reward strategy of the company. An attractive fixed salary can contribute to the strategic advantage of the system(Long,Ajagbe&Kowang, 2014).

Reflection From The Story

Samsung is known for using compensation for their internal stakeholders in the business. The main criteria for the company is to building a proper market reputation. They are also known as the leading the market with their products. The innovators of the company should access are motivated to work by providing the proper compensation. The main criteria for the business is to promote the brainstorming process as well as leverage the process by proper compensation. Samsung also supports the ideas of talent acquisition for the company and thus they help in the job posting and recruiting by talent auditions(Deelman et al., 2015). The concept of C-Lab is also used in this organization. The employees are empowered to grow more in stimulating the innovation purpose of the company. Therefore, despite the fairness and equality in the structure of compensation, the performance of the innovators and their department’s performance are calculated and encouraged with excess bonus preparation. The C-Lab projects and Research and Development center of Samsung are given emphasis to bring synergies in the personnel related to the departments and the projects (Samsung rewards Mobile division employees despite poor performance in 2015, 2018).

Samsung’s pay structure is competitive compared to the structure in the market. This helps them in attracting the proper talent in the system. Typically, as other company in the mobile industry pays the same kind of structure that Samsung follows. The earnings guide of the company follows a profit sharing structure. Additionally, the merit pay, gains and incentive sharing programs are also incorporate in the system.

The Main Issues In That Can Be Highlighted In The Company’s Compensation Management

  • Fairness in the pay structure is not properly followed. The performance related pay programs differ from the payment and frequency method of payout. Though this have lesser negative consequence, it is contradictory to merit based pay and market based pay. There are different kinds of merit level in people and that are avoided in performance, hourly, managerial, executive base pay system.
  • It heavily relies upon the annual revenue of the company to compensate the employee. This hampers the periodic motivational push that that the individuals need. Completely relying upon the operating profit have a mixed outcome on the employee’s compensation management. Some of the divisions rips the major part of the profits and remaining other can miss out the opportunity(Pillai & Abraham, 2016). Thus getting demotivated to give a one hundred percent to their company. The productivity also gets hampered in the process. As the semiconductor business is one of the most profit oriented company, this department gets more bonus in from the company.
  • Performance related pay also goes through a dilemma of whether the payment of employee salary and bonuses should be linked to individuals, organizations or the group’s performance. An effective pay strategy should consider all the level of employees(Deelman et al., 2015). Samsung is known to pay bonus on the basis of “sincere contribution to keeping the division running despite numerous challenges”(Samsung rewards Mobile division employees despite poor performance in 2015, 2018). Therefore, this contributes to the proper motivational support to the employee.
  • The organisational success does not reflect upon the Samsung’s success in the industry. The organisation’s success and employee pay means are must reflect upon the pay process to increase the intangible motivational factor in employees(Dusterhoff, Cunningham & MacGregor, 2014). The program does not administer the rationale of the compensation system. “Keeping the division running” does not encourage people and does not express proper gratitude to the system.
  • Open unequal employee compensation is another issue that can reflect upon the weakness of the compensation system(Gupta & Shaw, 2014). As per the merit based payment structure of the innovators in the company are paid more incentive regarding the business revenue (Deelman et al., 2015).
  • Battery division of the company not getting the proper motivation in terms of bonus, as they are not included in the proper slab of bonus like other divisions of Samsung digital media research lab, software centre, semiconductor and technology centre(Dusterhoff, Cunningham & MacGregor, 2014).
  • Social comparison suggests in equity theory that the employees will evaluate their pay based on the important influence of comparison in the industry(Berber&Slavi?, 2016). Thus it makes a huge impact that contributes to the fundamental motivation in the employee domain.


  • The main criteria of the paycheck that the employees receive after the month is to be used as a reward. Besides the compensation that the individuals receiveshould reflect and support basic mission of human resource in Samsung.
  • The main idea is to motivate, attract and retain the effective work force in the company. Therefore, the compensation must be aligned with that for full purpose. A relevant compensation range can be used in this process and thus it can lead to categorizing the employees and their target. The geographic location and compensation management of the company should be considered in Samsung. Comprehensive training programs for technical people should be included in the developed market.
  • Performance measurement should guide the market responsibilities of the compensation of the position. The current state statute should have revised so that the trend in the performance reach its efficiency.
  • Flexibility and responsiveness of that links the market place to the system should also be considered. The compensation linked to the employee performance to encourage participation and employee lifecycle.Both of this factor is influenced by flexible compensation system.
  • As performance management and training and development are connected functions of the company, they should also consider how the skill development would benefit the organization.
  • Most of all the Consistency should be incorporated in the compensation systemof Samsung which is highly an issue identified in Samsung. Clear compensation policy is the sign of transparency in companies. It should be applied and leveraged upon in the in the performance management system. An accountability chart of the stakeholders should be prepared and administered by the company too.


Therefore, it can be concluded that employee compensation and benefit programs requires proper attention in a company. It must be fair as per the equity theory of compensation management. The main criteria for compensation lies in the consistency and transparent performance system. Samsung has a mixed system in their compensation strategy. It has adopted profit and gain sharing strategy as well as merit based compensation strategy. The pros and cons of the system are highlighted in the reflection. As a market leader and champion in innovations strategy they also go by a proper strategy to compensate and reward their employees. As the article suggests they did not have proper increase in profit last two years. The article also highlights differentiation in profit of the company’s different division. Based on the analysis of the article’s the recommendation is given. The recommendation is aimed to alleviate the effect of compensation system in the company. This is supposed to alleviate working culture of the employees.


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