When I was working in Verizon Inc., I realized that the company used a market competitive pay system. By being a technology firm, there was a great need for the firm to ensure that they get and retain the most talented lot of employees. This was the reason why they settled on the competitive market strategy of compensation. What this means is that they frequently reviewed their salaries to make sure that the employees were satisfied working with them and would thus not be swayed by higher salaries which were being offered by other competitors who also require the same type of talent in their situations. The form of payment was, however, hierarchical in nature. This implies that the higher in power and authority one was, the higher the pay.
This proved to be a perfect strategy for the company. Most of the best and most talented individuals in the organization expressed their satisfaction with how the company handled them and from the records, most had stayed in the organization for periods as long as five years plus. The newly tapped talent was also comfortable with the way they were compensated for services offered and also showed interest in remaining loyal to the company.
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However, despite having such a viable structure, it is important that the business pays the workers regarding the level of contribution made to the enterprise. Because of their hierarchical form of pay structure, some employees in the lower factions of the hierarchy end up receiving little pay yet they play very significant roles. This, therefore, acts as a call for the management to review their pay structure to make sure that the most hardworking employees are also well compensated and given value for their service.
