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Review: Strategic Compensation


Title: Strategic Compensation – A Human Resource Management Approach (third edition)
Author: Joseph J Martocchio
Publisher: Pearson Prentice Hall
ISBN: 0-13-182476-7

Review by: Kay Maddox has worked in both the public and the private sector where she has held HR roles with BAE SYSTEMS, Alstom Transport and Pirelli Cables. She currently holds the post of Management and Diversity Development Manager at City College Norwich. Kay has also taught on various HE/FE courses including the CIPD programme.

‘Companies’ success in the marketplace is as much a function of the way business practitioners manage employees as it is a function of companies’ structures and financial resources’

On first appearance this hardback version looks a pretty weighty read. With its 505 pages of smallish text (10-12 font size) it did take quite a degree of self motivation to get started. It is written by an academic American teacher and consequently has a very strong American focus throughout with examples and cases coming from The New York Times, IBM, Business Week etc. All figures quoted in the text are discussed in dollars.

The book is divided into fourteen chapters and is clearly laid out with a very comprehensive contents list (all 12 pages of it!). The author considers that the book ‘lends itself well to courses offered as 10 week quarters or 15 week semesters. This suggests the book would be most useful as a course handbook. The chapters are organized in five parts:

Part I: Setting the Stage for Strategic Compensation
Part II: Bases for Pay
Part III: Designing Compensation Systems
Part IV: Employee Benefits
Part V: Contemporary Strategic Compensation Challenges’

The author goes on to advise readers/tutors on how best to use the book and provides details of websites that can be used to support the text. A summary of the main changes to the revised edition is also provided.

Each chapter begins with an outline of contents and learning objectives which is a useful checklist as it really does aid navigation of such a large amount of information.

A very comprehensive glossary is contained towards the back of the book which explains everything from ‘employee stock ownership plans’, to the ‘Fair Labor Standards Act of 1938’ and the ‘Glass Ceiling Act’. The glossary really brought home the American focus of the book as much of the references are about American law, allowances, organisations and history. The book does consider some useful academic models but the American context of the points considered makes it more difficult to evaluate the practical application of the ideas discussed.

First impressions were correct – this is a weighty read. Ideal if you’re a compensation enthusiast or if you need a supporting course book for study purposes but not one for beginners!

One Response

  1. Does “Compensation” Benefit HR?
    This is neither a comment on the contents of the book nor on Kay’s review of it, but rather a plea for HR practitioners to reflect on their use of the word “compensation” when referring to strategies and practices in the area of pay and benefits.

    HR directors argue that creating “great places to work” and making work meaningful for people can add real value to bottom-line results; and there is compelling evidence to support this view.

    Given that, why should anyone need to be “compensated” for working in an organisation enriched by enlightened people management? You compensate people for losing a leg, not for doing something that – if the wider HR/OD agenda delivered on its promises – would provide them with meaningful, learningful and inherently rewarding experiences on a daily basis.

    Pay people well and equitably, and make other benefits available as appropriate; but don’t succumb to the use of the Americanism “compensation” to describe these practices. Otherwise, people might be forgiven for thinking that HR can do no better than to envision a working environment that is as painful and debilitating for staff as a broken leg would be.

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