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Variable Compensation: All HR Needs to Know

AIHR

Finding the right mix of pay, benefits, and other incentives is essential to attracting and retaining top performers, especially in a tight labor market. Variable compensation can be a useful tool for rewarding employees’ performance to provide measurable results for your business. Contents What is variable compensation?

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Incentive Pay Challenges And Opportunities In 2023  

Chief Executive

As a result, organizations have increased their base salaries in recognition of a robust and competitive talent market, but salary increases are lower than inflation rates because of the prospect of a softening economy, and some organizations are also reducing or planning to reduce total staff to manage costs. See the table below.

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Groupon Doomed by Too Much of a Good Thing

Harvard Business Review

ACSOI essentially measures Groupon's profits before subtracting its subscriber-acquisition costs and stock option-based compensation. Secondly, expecting a business to be profitable quickly forces it to keep its fixed costs low. In the first quarter of 2011, Groupon posted a net loss of $113.9

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Why HR Really Does Add Value

Harvard Business Review

Even sacred and often arcane areas of HR such as executive compensation are now largely guided by outsourced providers who are experts in current tax and SEC regulations. Within the first year of our effort net sales increased 27 percent while fixed costs were reduced by 40 percent. Not all fixed cost reductions were people.

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The Customers Who Are Happy to Pay More for Less

Harvard Business Review

This makes financial sense in industries with high fixed costs and low variable costs: larger sizes enable the company to charge higher prices that, even if they are just slightly larger, absorb a higher portion of fixed costs, while reducing packaging cost per volume and attracting value-minded consumers.

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Five Ways to Retain Employees Forever

Harvard Business Review

We've previously argued why employees benefit by staying with the same company for at least 10 years. By making the fixed cost of payroll inherently more variable under differing business conditions, you can make your company more resilient and agile, while also treating your employees exceptionally well.

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Who Wins in the Gig Economy, and Who Loses

Harvard Business Review

A full-time job provided the steady income needed to support our traditional version of the American Dream: the highly leveraged, high-fixed-cost house; the cars; the latest consumer goods. They can command attractive compensation, garner challenging and interesting work, and secure the ability to structure their own working lives.