Columbus Custom Carpentry: A Compensation Case Study Douglas Reys, SPHR 2010

Primary Focus Primary focus: Compensation. Internal equity. External equity. ©SHRM 2010

Your first day on the job as the company’s first HR manager. Setting Your first day on the job as the company’s first HR manager. Columbus Custom Carpentry is a small but growing Midwest company that manufactures residential interior doors. Its competitive advantage is its ability to produce a custom-styled product at a low price. In the industry, this is known as mass customization. Columbus Custom Carpentry has have achieved this by producing custom assembly jigs that reduce the time and therefore the labor cost required to produce their doors. Recently, however, the company’s labor costs have been rising, as has the amount of overtime required to produce the same volume. Personnel issues appear to be the problem. The company president has decided it is time to hire the company’s first HR manager. During the interview process, some of this was mentioned somewhere between positioning the company for future growth, hiring and the need to manage personnel issues on a more professional and consistent basis. On the first day of work, the new HR manager hears from various employees about the real issues and is given a tight deadline from the president for the first response. ©SHRM 2010

Tools Management interviews. Employee handbook. HRIS database. Market wage/salary data. Supplemental case materials: Internet Resources - Web site listing. The management interviews simulate the information a new HR manager might collect during his or her first few days on the job. The employee handbook contains company background and specific information on the company’s compensation practices. The benefits data in the handbook serves to show that the problem is not with benefit competitiveness . It also gives students a sample of a company’s benefits that they may not have been exposed to through most summer jobs. The HRIS file will give students information about individual employees, including turnover data, pay rates, job titles, age, sex and EEO class. Also contained in the HRIS file is a listing of CCC job descriptions and market wage survey data. Students will use this data to develop solutions to the problems they discover. Students will have to judge which data are appropriate to use. Students are expected to have studied the following HR knowledge elements before working this case: internal and external pay equity; job grades and pay ranges; market rates/pricing; turnover; job description development; and job analysis. The supplemental materials may provide web sites or brief overviews of the subjects but should not be relied upon to provide sufficient background for students new to the concepts. ©SHRM 2010

Your Challenge Demonstrate qualitative and quantitative analysis skills by diagnosing problems and their root causes. Apply your subject matter knowledge to create a solution to the problem. Present your analysis and solutions in written and verbal presentation formats. ©SHRM 2010

The Response Problem identification and root causes. Range of alternative solutions. Selection of solutions to be implemented. Implementation details. ©SHRM 2010

Deliverables Preliminary report and outline. Final written report. Presentation of recommendations. ©SHRM 2010

Grading Preliminary report: 25% Final written report: 50% Presentation: 25% ©SHRM 2010

Due Dates Preliminary report: _______ Final written report: _______ Presentation: ______ Depending on class size, the number of groups and how often the class meets, there may be a significant delay between the first and last classroom presentation. The final written reports will even out the advantage of the later presenters because later teams cannot change their presentation significantly from the written report they submitted (or at least, the changes can be recognized by the instructor). Alternately, you may find it useful to split the class and have in attendance only those who will be presenting on that same day. If you have a boardroom-style conference room available, using it with a smaller audience will help make this feel more like a business presentation rather than a classroom exercise. Inviting a few business professionals or recent graduates will also contribute to that atmosphere, regardless of what type of room you use. Some instructors make dress a part of the actual grade. The author has not built that in as a separate category, but professionalism is considered and dress is a part of that. (In the author’s personal experience, grading dress is perceived by the students as unfair at the time, but very valuable later.) ©SHRM 2010

Questions? ?????? ©SHRM 2010