To be an Employer’s Brand or the best organization in society in view of the hyper competitive environment, an organization needs to develop a unique compensation and reward strategy that will be used as a motivational factor for employees. The Compensation and Reward System in an organization must fit the organization’s goals/objectives. Moreover, such system/approach is most likely associated with profitability of the organization, its size, the exposure to global competitive forces, the degree of unionization, amongst others.
For my final project in this module – HR Resourcing, I will elucidate on the Compensation and Reward System of Toyota Motor Company (TMC), with the following highlighted sub-topics to be discussed.
- Assess the Toyota Company, in terms of its organizational strategy, objectives, mission and values.
- Make analysis on the environment in which TMC operates with regards to industry, business life cycle, etc.
- Evaluate the Toyota’s current reward and pay strategies on two criteria: for meeting its overall organizational strategy and for maintaining competitive advantage in the face of new challenges and changing conditions.
- Reach a reasoned and evidence-based conclusion about the level of success achieved by the organization in motivating employees to reach organizational objectives and propose a reward and pay strategy that may better serve this purpose.
2.0 Proposal for the Toyota Motor Company:
Toyota Motor Company (TMC) is considered the largest car manufacturer company in the world. It is a multi-national Japanese Company that commenced in 1933, as an off-spring of Toyoda Automatic Loom; and eventually emerged as a separate entity 1937. Currently, Toyota implements a reward system comprising of three clusters: seniority based system, bonus payment on team’s performance/ team reward system and total health management. As noted by Pilbeam & Corbridge (2010), employees are rewarded for the roles they assumed in their organizations, values displayed, behaviors exhibited, and most of all in pursuit of organizational objectives. Contrarily, the company is implementing scheme wherein employees are rewarded based on joint efforts.
This approach seems motivational to employees as it encourages each team to endeavor in improving its performance above others; which is evidence by retention and the loyalty of employees. Given that Toyota is a multi-national company, there are various factors to be taken into consideration; in terms of geographical distribution, competitive forces in regions/locations, policies and practices in host countries, legislators, etc. There should also be standardization of compensation of expatriate in various locations. In the following weeks ahead, I will be discussing the compensation and reward scheme of TMC, from a global perspective.
I will avail of the prescribed text book for this module, scholarly journals, conference papers, search engines, Toyota web pages, amongst other resources.
- Pilbeam, S. & Corbridge, M. (2010) People resourcing: contemporary HRM in practice. 4th ed. London: Prentice Hall International.
- Shelton, T. (2008) ‘Global compensation strategies: managing and administering split pay for an expatriate workforce: multinational companies need an effective and efficient solution to manage, track and calculate complex split-pay compensation arrangements’, Compensation & Benefits Review, 40 (1), pp. 56–60, SAGE Premier [Online]. DOI: 10.1177/0886368707312219 (Accessed: 30 March 2009). http://dx.doi.org.ezproxy.liv.ac.uk/doi:10.1177/0886368707312219
- The Winthrop Corporation. (2012). Toyota Motor Corporation, Company Snapshot. [Online]. Available at: <http://www.corporateinformation.com/Company-Snapshot.aspx?cusip=C39290080> (Accessed 11 May 2013)
- TMC. (2003). Social and Economic aspects [Relations with stakeholders]. [Online]. Available at: <http://www.toyota.co.jp/en/environmental_rep/03/shakai_sokumen.html (Accessed 12 May 2013)