PepsiCo Compensation Plan Outline Sample Paper

Evaluating a Company’s Compensation Plan to Determine how it Could be Improved

Using the same company you researched in Assignment 1, evaluate the company’s compensation plan to determine how it could be improved.

Write 7 page paper in which you:

  1. Evaluate the existing compensation plan to determine if it is the most appropriate for your company. Explain your rationale.
  2. Determine the most beneficial ratio of internally consistent and market consistent compensations systems for the company you selected.
  3. Evaluate the current pay structure used by your company and assess the recognition of employee contributions.
  4. Make two (2) recommendations for improving the effectiveness of the discretionary benefits provided by the company you selected.
  5. Evaluate the types of employer-sponsored retirement plans and health insurance programs provided by the company you selected and compare them to that company’s major competitors.
  6. Use at least three (3) quality references. Note: Wikipedia and other Websites do not qualify as academic resources.

PepsiCo Compensation Plan Outline Sample Paper

A compensation plan is coordination and structure of details that illustrates employee’s pay schemes and incentives that accurately define the pay system of every company (Salary.com, 2014). Additionally, a compensation plan is created and implemented to assist, ease, and recompense the performance of employees. The compensation plan can either be in monetary or non-monetary benefits. Further, the incentives and benefits can be in the form of overtime compensation, bonus, travel allowances, stock options, insurance benefits, medical and health benefits. In this regard, I will discuss the evaluation of the existing compensation plan of PepsiCo. I will also shed light on current pay structure and proposals for improving the discretionary benefits.

Evaluation of the Existing Compensation plan of PepsiCo Inc

PepsiCo Inc. is a worldwide food, beverage, and snack food established in the United States, its headquarters are in New York. PepsiCo Inc has interests in manufacturing, marketing, and also distributing snacks, food, and beverages, made from grains, and many other products (PepsiCo careers, n.d). The operation of PepsiCo Inc is to provide its universal and comprehensive consumers with corresponding, suitable, inexpensive, and scrumptious food and beverages varying from complete breakfast lunch, and superb and terrific delicacies in the evening. The PepsiCo recognizes and acknowledges the purpose and intention of implementing employee support system through the creation of the compensation plan. The compensation plan of PepsiCo Inc centers on offering monetary and also non-monetary benefits. These incentives include wellness programs, retirement, and healthcare benefits. The purpose of the compensation plan is to reward and recompense the employees of the company for their outstanding and excellent performance.

Read also Compensation Practice Of A Publicly Traded Company – PepsiCo Inc

Further, the company has also created a compensation committee, which is responsible and deals with the structuring of an ample and satisfactory compensation plan and strategy that primarily endeavors at employing, maintaining, and inspiring a larger team of skill and talent from sundry nationwide and intercontinental markets. The compensation committee devices and creates short-term and long-term incentives for recompensing the employee performances and also follows its effectiveness on the efficiency of the employees. Additionally, the committee designs compensation plans that are competitive regarding the industry principles and also in accord with the objectives and goals of the company. Also, the compensation plan established and implemented by the committee provides for the tiny and little requirements (Bailey, 2012). It also operates as a resolution for any problem and challenge experienced by the employees. The compensation plan of PepsiCo Inc values, honors, and esteems every individual employee effort and involvement in the accomplishment and success of the company. Therefore, the compensation plan enhances the employee confidence and poise. Finally, the compensation plan inspires a sense of reliance on employees and also motivates the employees to perform well as their performance is recompensed and rewarded.

The most beneficial ratio of internally consistent and market consistent compensations systems for PepsiCo Inc

An excellent and high- quality compensation plan consists of a balance amid internal equity and external competitiveness. Compensation and benefits influence the productivity and contentment of employees, as well as the capacity of every company to achieve its goals and objectives. It is a benefit and an advantage for every company to ensure that its employees creatively compensated, and they are aware of their benefits. A company’s compensation plan has outstanding outcome and achievement on its competitive advantage. Further, for a company to develop and expand a competitive advantage in the international market, it has to ensure that compensation plan supports totally the strategic plans and also the proceedings and dealings of the company (Bailey, 2012).The employment costs greatly affect the competitive advantage of a company as they signify a great portion of a company’s operating budget. Therefore, efficiently controlling these costs, a firm can achieve cost leadership. The impact of employment costs on competitive advantage is predominantly strong in service. There are other labor-intensive in some companies, where the employees expand between 40 and 80 cents of the revenue on the labor costs. PepsiCo Inc has a balanced ratio of internal equity and external competitiveness, which has highly influenced the growth of the company in the international market.

Evaluate the current pay structure used by your company and assess the recognition of employee contributions

Pay structures are used to regulate a company’s compensation plan since; they replicate the Confederacy of jobs found on relative worth. Additionally, distinctive pay structures have some rating and rank such as job clusters and career bands, which every cluster has a least or utmost salary connected. PepsiCo Inc uses various pay structures to pay its employees these include, Job Family Structures, Graded structures, and Broadband salary structures. The company uses internal equity and market pricing to create salary ranks and clusters for its employees.  These pay structures assist the company to implement a designed framework, which is reliable, reasonable and impartial, finally, the salary structures determine clusters of pay jobs and people.

PepsiCo Inc as multinational company equates its success to its employees, so it highly recognizes the efforts and contribution of its employees (Salary.com, 2014). The company recompenses and rewards employees that surpass performance principles. The rewards and the incentives show the employees that they are recognized and valued by the company. Further, the company has created a recognition system, which is straightforward, reasonable and fair to all employees. These have always inspired and motivated the employees to work hard and improve their performance.

Make two (2) recommendations for improving the effectiveness of the discretionary benefits provided by the company you selected.

According to the researched I carried out of PepsiCo Inc, revealed that although the company has created a steady compensation plan and a recognition system, there are some employees that are discontent with the benefits (PepsiCo careers, n.d).Therefore, the company should create and execute a contentment assessment to review and evaluate the employee’s perception, and feelings concerning the current compensation plan and the benefits accrued. The analysis should include the interest of all the employees and the findings from the assessment reviewed. Secondly, the company should carry out an assessment to analyze the compensation plan, and identify the ones that need to be reviewed. Finally, Pepsi as an international company should also implore opinion and responses from the headquarters all over the world and assess how their employees are treated.

Evaluate the types of employer-sponsored retirement plans and health insurance programs provided by the company you selected and compared them to that company’s major competitors.

PepsiCo Inc offers a profuse retirement package that includes of legal assistance plan, and education compensation. These comprise of the total compensation plan for all the employees. It also has a saving retirement plan for its employees; the retirement plan offers income to its employees even after they retire. Also, the company awards its employees with insurance plans that cover them together with their families. The main competitor of PepsiCo Inc is Coca- Cola, which offers viable benefits and compensation to its employees. The Coco Cola company has created and established a compensation plan that permits its employs access to savings and pension benefits (Strauss, 2014). Coco- Cola displays high loyalty and dedication to minorities and diversity and has created flexible compensation plan to suit the needs of its varied employees.


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