WOLFGANG’S BALANCING ACT

A1. Should he move some of the existing pay elements across the T account in Figure 2,

shifting them from globally standardized to locally customized?

The solution that Woldgang comes up with, as indicated in figure two (Dowling, Festing,

& Engle, 2013). , is in my opinion, a working solution to the current dilemma that he is

faced with, except for two key points. I would recommend localization of the policy allowing for

local currency to be used when calculating short-term incentives. It should not just be

exclusively for the U.S and Japan, as most people throughout the world identify best with the

currency they were born into an have been using for a majority of their lives. Secondly, he

should also localize compensation elements including variable pay as different cultures promote

differing mindsets as indicated in the example of the U.S and Japan. (Dowling, Festing, & Engle,

2013).

A2. Should he add or delete some existing practices from the T account?

I do not believe that there should be anything removed or added to the solution that

Wolfgang came up with it is sufficient and fair across the transnational chain of the company. It

is designed in such a manner as to cater for the difference in cultural practices both business-wise

and socially. Also, it is well suited to increase productivity as the employees will be amply

incentivized to be more productive.

A3. Should he change the weights or emphases (percentages) of existing elements of the pay

system?

Wolfgang should change the weights or emphases in the existing pay system to reflect the

variable pay elements. Such that, as the U.S variable pay is 35 % of their salary, they should
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have a slightly higher weight in pay system as the have more lose. In contrast, the weight in pay

system for Japan should decrease as they will have less to lose as their variable pay is a lot less.

This will not only ensure fairness across the board, but will also streamline the cost of benefits

pay. (Dowling, Festing, & Engle, 2013).

Competency based systems will ensure that the employees are highly productive as they

will be highly motivated to be so. This being because this system rewards productivity in the

sense of positional promotion which is accompanied with better salary and bonuses. It also

ensures that those in management positions are also productive and not just riding on the success

of their juniors’. This is because an unproductive manager will end up being replaced by a

productive employee. These systems ensure that there is consistency across all the business

locations in the world. (Dowling, Festing, & Engle, 2013).

B1. How can the firm communicate to the geographically dispersed executives the need

to acquire and maintain those management competencies that have been defined in the

competency set (in folder three)?

The firm should hold periodic executives’ training meetings in order to sensitize them on

the need to maintain management competencies. These meeting are the best way to ensure that

there is a single message, clear and concise across all business locations in order to maintain

consistency. Failure to which, will see them lose their jobs. This will ensure that company policy

is maintained throughout the business locations. (Dowling, Festing, & Engle, 2013).

B2. Would a purely competency-based pay system be somehow more flexible?

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A purely competency-based pay system would be more flexible as it rewards productivity

from an individual stand-point to a group stand-point thus. It is promotes productivity while at

the same time discouraging stagnation and unproductivity as these employees will be rooted out

and replaced with productive employees. (Dowling, Festing, & Engle, 2013).

B3. But then again, what about the standardization Healthcare has just achieved

through standardizing the job descriptions across units?

The standardization of job descriptions has ensured that there is consistency across all

business locations as you can identify with the company employees of any business location thus

creating a great facilitation for activities such as progress reviews.

B4. How would he take these three competency categories and use them to develop a

series of measurable, behavioral indicators to be used to assess an executive’s

contributions to Healthcare? In what sense should these new behavioral indicators be

customized to local (regional) contexts? How can Wolfgang go about this process to

ensure a balance of organizational standardization and local relevance?

Through competency based system, he can measure the progress of executives across all

location, through business-related competencies where we can see how their leadership has

contributed to achieving branch targets, creation of innovative policies or products that bring

about improvements and their overall decision making, people-related competencies through

looking their ability to develop talented employees under them. Also, look into their ability to

create trusting relationship both internally and externally. Through personal-competencies, it can
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be determined whether they have the ability for analytical thinking, and self-development skills.

(Dowling, Festing, & Engle, 2013).

Frustrated with the complexities he is facing, Wolfgang is planning a telephone conference

with regional compensation administrators and other executives in order to expand his

analysis with this group and to build political support for a new policy Does he have the

time to deal with all the inevitable differing perspectives that will emerge, and can they

together create a systematic set of recommendations before his report is due to the

Healthcare board? As a member of Wolfgang’s telephone conference please comment on

the question blocks A and B.

I believe the solutions that Wolfgang has come up with will only be met with minimal

resistance, believing that the regional manager also wish for a system where there efforts are

recognized and rewarded. As a member of this telephone conference, As for part A, I would

mostly be opposed to the compensation elements as the varying pay elements attached would not

be met with acceptance in my country. For part B, I would fully support the change to

competency based system as that would promote productivity and discourage lazy mindsets.

.
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References
Dowling, P. J., Festing, M., & Engle, A. D. (2013). International human resource
management(6th ed., pp.289-297). Cengage Learning.