External Competitiveness

Compensation programs that might be extremely effective in a home-country location will fail if they violate local cultural values. Industries which tend to use individual rewards and pay-for-performance as both a motivator and core compensation component around the world risk their compensation strategies backfiring. Successful compensation approaches differ according to the type of organization.  For example, compare the compensation approach of the ownership driven structures of small, high-technology groups with the more traditional service and responsibility driven structures in the “smokestack” industry.

Switzerland ranks 4th for education, 1st for health, 1st for its workforce, and 2nd for enabling environment. It’s worth noting that the World Economic Forum is based in Switzerland, but based on empirical metrics like employee training, talent retention, scientific output, and productivity, the country wins out The Swiss economy is characterized by a skilled and generally ‘peaceful’ workforce. One quarter of the country’s full-time workers are unionized. Labor and management relations are amicable, characterized by a willingness to settle disputes instead of resorting to labor action. Switzerland provides grade A employees and they expect grade A type of pay and they’re worth it.

A pay-for performance plan is an excellent way to focus your employee’s actions on the areas that need attention. They are a tool that can be used to shine a spotlight on key company priorities and business drivers. A critical business objective for every company, well-designed pay-for-performance plans help companies compete for the talent they need and communicate company priorities and critical business objectives to employees.


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Robbins, S. P., & Judge, T. A. (2013).Organizational behavior (15th ed.). Boston, MA: Pearson

Transformational Leadership Style – Research Methodology. (n.d.).

Willmott, H. (1992). Postmodernism and excellence: The de-differentiation of economy and culture. Journal of Organizational Change Management5(1), 58-68.

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