Compensation Study Set 5
Quiz 14 :
Compensation of Special Groups
Since ages it is viewed as directors were given by higher management the job of signing and decisions which are taken by stamping. Those kinds of boards are filled with directors who are retired persons and attorneys. But this generation boards have changed drastically. Some of the scandals which has involved in corporate hiring directors who are not willing by the stockholders as these directors are paid highly. This result in blaming corporate directors who work in the compensation committee. This is the reason why management is being very cautious while taking decision on the compensation part of the directors. Therefore it is made a line that the total compensation of the board of directors to be on an average of $250,000. But now a day's compensation is planned based on the performance targets and also compensating them with the stocks and shares which can be redeemed in future which will at least take one year. One more drawback is that stockholders claiming that the compensation given to the directors is not justified as compensation is not given on the performance of the company financially. It is also argued that directors draw equal amount of salary as of CEO's which is not acceptable technically. Apart from these, the other important fear is that stockholders may go to an extent of suing the board as the compensation is not planned based on the financials of the company. Therefore, all these factors are the reasons why many people does not take initiative in choosing to work in corporate boards.
The case study throws light on competency levels of the stadiums in terms of number of seats, total sales, team performance and advertising activities. a) The most important point in the design of a sales incentive plan for the three sales staff is the number wise breakup of seats and the respective costs. This relevant point affects the pay design and sales incentive plan in the following way: • It is quite evident that if the price of premium seats is brought down, there would be increase in revenue from the tickets sold. Also, there would sales form banners and advertisements. • If the variable component of the pay for the sales and the administrative staff is increased, it would rejuvenate the company sales. b) Increase in advertising sales basically relies on team performance and the team performance only drives ticket sales. In turn, advertising depends on number of seats sold Among all the unit rate plans, the best plan to increase sales of advertising is to focus on the sale of premium sales that would help in reducing the "seat shifting" by fans buying standard and bleacher. Also, the advertising sales are huge, owing to billboards advertisement throughout the stadium, outfield fences, and scoreboards. c) The placement of product information throughout the stadium and various other places generally influence the dollar amount one pays for the ticket to watch the game. For example, various types of advertising displayed on billboards, outfield fences, event dugout, roofs and scoreboards. Other than that advertisements made in metro trains, restaurants and on streets.
Compensation of a person is decided based on many factors like education, experience, knowledge and skill set. Special classes or groups professionals are treated differently as they directly lead to success of the company. These companies directly rely on the results generated by the special class professionals. This helps in attaining positive results which the business to grow. Compensation of those professional who are highly knowledgeable is linked with the span of time spent in the schools as it is time that the person uses to acquire the knowledge on the special course or subject. Hence the more they spent time in the school the more they gain knowledge which results in high production and this is the reason compensation is linked to this concept. Therefore, compensation of professional's depends on the time he spent in school.