FastCat

Compensation
Structure
Report Four

Sarah Balseiro, James Dunham, Zakkary Kimball, Kerry Morris,

Michael Murphy
12-7-2015

Table of Contents
1. Executive Summary2
2. Objectives.4
3. Internal Structure8
4. External Competitiveness14
5. Performance and Management..23
6. Conclusion.32
7. Appendix.35
a. Strategic Map35
b. Job Structure.36
c. Compensable Factors..37
d. Job Ranking Evaluation42
e. Benchmark Jobs..46
f. FastCat Access Database II Graphs....48
g. FastCat Access Database II Data...49
h. Initial Salary Adjustments....51
i. FastCat Access Database III Graphs.53

Executive Summary
FastCat is a privately-held company that creates, maintains, and updates a healthcare database
for small-medium sized health centers. FastCat creates these programs to lower process inefficiencies in
order to reduce cost for the clients of the FastCat healthcare database. By creating a low-cost product,
FastCat has always been a leader in the small-medium sized health center market for their healthcare
databases. Lately, FastCat has been worried about the larger companies entering the healthcare database
market (such as IBM, Oracle, Epic Systems).
In order for FastCat to accomplish these goals, they will need to integrate innovation and
teamwork. In order to do so, FastCat will have to focus on hiring innovators who will create and implement
new software updates/products in order to keep up with the ever-changing technology business. By
having a more innovative product, this will create more demand for FastCats product. FastCat knows that
by creating a new compensation system, the company will attract and retain top talent, while also meeting
customer expectations in the healthcare systems market.
Four compensation objectives were identified that would make FastCat successful: internal
equity, teamwork environment, innovation/external competitiveness, and performance recognition.
Internal equity would create a fair environment, where employees would be able to understand how their
pay is determined. This would lead to FastCats success in order to attract and retain talented employees
who believe in a fair pay environment. A teamwork environment is part of the mission statement, and will
help employees collaborate with each other to produce outstanding ideas. A supportive innovation
environment will help FastCat employees spend time creating and perfecting new ideas/updates that will
benefit FastCat products. Performance recognition will lead employees to be satisfied that they are being
recognized for their work, whether that be financially or verbally. This will lead to lower turnover rates.

Job structure was decided to be based on a job-based evaluation. There will be a job ranking that
is determined by the compensable factors that are found within the job descriptions of each position at
FastCat. The compensable factors are as follows: analytical effort, education skill, experience skill,
interpersonal skill, technical skill, innovation responsibility, and management responsibility. All of these
compensable factors were decided to have different weights determined on the value added to FastCat.
Each job was evaluated with an amount of points which were weighted, and ranked accordingly. This is
our job structure, where there is more detail below.
An external survey was conducted in order to gather relevant data on FastCats competitors.
Benchmark jobs and company matches are chosen in order to get accurate data on similar jobs to FastCat
within the geographic area. An above the market rate is chosen in order to attract and retain top talent.
Some jobs with higher job evaluation points and are more integral to the success of FastCat are assigned
to a Pay Policy Line that is 10% the going market rate in order to highly reward employees. Other jobs
with lower job evaluation points and are less integral to the success of FastCat are assigned to a Pay Policy
line that is 2% above the going market rate because the jobs are more universal and be easily found at
any company.
Current employee salaries and performance reviews were then evaluated to determine any
outliers and figure out the best plan of action in order to correct these mistakes. Once obvious corrections
were made, a merit pay plan and bonus system was then outlined and then implemented to the
employees who met the criteria. Benefits were then determined to be 10% of total compensation in order
to still appeal to employees and lead the market in total compensation. Overall, the adjusted base is the
highest in terms of important to FastCat in order to attract and retain top talent (external competitiveness
objective), followed by bonuses (performance recognition objective), benefits, and then merit pay.

Objectives
Compensation Objective A: Internal Equity
The importance of an internal equity system and clear communication of how the system will
function is clearly a need to as revealed by the Employee Engagement survey. We aim to raise the I
understand how my pay is determined metric from 58% internally to 68%, with the ultimate goal of
reaching and surpassing the national average of 74%. This plan will be rolled out in the next 2 years. We
will create a greater system of internal equity that is clear, fair, and communicated to employees. This
system will have parameters to create a pay scale for all of our positions to include; importance of the job
to the company, education required to perform it, number of qualified candidates are in the job market,
etcetera. Where each employee will fall on this scale will be determined by personal qualifications that
would set them apart from others qualified for the role to include; education beyond minimum
requirements, experience within the industry, exceptional performance in the past. This plan will have a
set method for employees to increase their pay level, so as to retain high level talent.
Once this plan is developed it will be explained to employees and ensure that they understand
how their pay is determined. In addition, when employees are up for a pay increase they will be shown
what determined the pay change, based off performance of the individual, their team, and the company.
Compensation Objective B: Teamwork Environment
At the end of three years our goal is a 10% increase in employee commitment to the organization,
and a 5% increase in willingness to go above and beyond what makes us successful. The 10% increase in
employee commitment will be an effective measure of whether or not the teamwork environment was
successful because by cultivating a teamwork environment, employees will be actively working together

towards the current and future success of FastCat each day, leading to an increase in commitment to the
organization. Together, we work as a team is part of the new mission statement that FastCat has
adopted going forward. One goal that can be achieved through a teamwork environment is innovation.
The New Reality team found that closer collaboration between marketing and engineering is necessary
for engineers to produce the right products that the market is ready for. A teamwork culture can facilitate
that relationship because employees will know an emphasis is put on collaboration for success in their
jobs and for FastCat. Also, a teamwork environment will help all employees to focus on customer
satisfaction and the companys success as a whole. Without competition between employees, there wont
be a drive for success at the expense of another employee, which could result in lost sales due to a shift
in focus away from the customer. Each employee is still valued for individual contributions, but they are
also valued in their contributions to the team and to the companys success overall.
FastCat employees are already on par with the national percentage of employees who are willing
to go above and beyond their job to achieve organizational success. If employees are even more
committed to FastCat, they will be more willing to go above and beyond to contribute to the success of
the company. An improved commitment to FastCat will improve employee retention and cut costs
associated with hiring outside the organization, a weakness that the New Reality team highlighted in
their analysis.
Compensation Objective C: Innovation/External Competitiveness
By the end of 3 years, we want to see the customer survey increase by 25% (about 1.1 points) for
this subject. We will take the necessary steps to meet this goal. We want our customers to see first-hand
that they are extremely important to our success. This will hopefully through the many forms of
communication such as the use of social media for example continue to grow and attract potential new
customers.

In order to achieve success at FastCat, we must produce innovative, and high quality products
that will not only surpass our competitors but will also be designed along-side our customers best
interests at heart. For us to achieve this goal, we must have the most qualified skilled workers for the job.
We will both promote from within the current ranks of FastCat and hire from outside the industry. We are
always looking for new ideas and want fresh perspectives from every employee. Like any business, we at
FastCat believe that the customer is always right. That is why we are going to implement a new test run
and feedback system which will allow potential new customers to try our products first hand. This in the
long run will allow us to increase the overall customer satisfaction.
In order to compensate our employees and make them feel that their hard work is noted by the
company, FastCat is going to introduce some new incentives for its outstanding employees. This will
hopefully continue to encourage innovation. For the teams or individuals that the company believes to be
the best of the best, will be rewarded for their efforts. We will have both short term and long term rewards
which will include things such as promotions, employee of the month, all-expense paid vacations, etc. Our
employees deserve the best because FastCat promotes the best.
Compensation Objective D: Performance Recognition
By the end of the 3 years, we want to see the employee engagement survey showcase a 5%
increase in employees believing that their performance is rewarded. Within the engagement survey, there
is a question that states, When I go a good job, my performance is rewarded. This question directly
addresses the issue on whether or not there is employee recognition. We feel as this will be an accurate
representation of the engagement levels of our employees and be an effective measure for our
performance recognition program because it directly measures whether performance recognition is
occurring.

The need for Performance Recognition is based off of the Employee Engagement survey on Exhibit
7, When I do a good job, my performance is rewarded. Only 45% of employees at FastCat believe that
when they do a good job that they are being rewarded for it. This is less than half of the employees at
FastCat, and though higher than the national average, we need our employees to feel as if they are being
rewarded for their performance. By instituting rewards for high performance at FastCat, we feel as if we
will raise employee morale and motivation, and in turn decrease turnover rates. This does not necessarily
have to be in the form of compensation; we also want to encourage managers to verbally reward their
employees when performance expectations have been exceeded. An increase in morale for our
employees will have them excited to go to work in the morning, and wanting to stay with the company
for a long period of time. In terms of performance, if an employee feels as if they are being recognized for
their exceptional work on a regular basis, they will want to keep up with the good work instead of falling
into a pattern.
Without performance recognition, we fear that employees will feel undervalued at FastCat when
in reality all of our employees are valuable assets. If employees do not feel valuable, they will go to a
competitor company in order to feel more important. We also want to make the work done at FastCat
enjoyable; if an employee enjoys their work, more work will get done and more attention will be paid to
the fine details. We feel that adding performance recognition as a common daily occurrence to the FastCat
culture will only help employees perform even better at a low expense to the company.

Internal Structure
In order for FastCat to structure their jobs appropriately, compensable factors must be chosen.
Compensable factors are what make the jobs at FastCat so valuable, and they must relate to the objectives
stated before. Seven factors were identified: Analytical Effort, Education Skill, Experience Skill,
Interpersonal Skill, Technical Skill, Innovation Responsibility, and Management Responsibility. These
compensable factors were carefully chosen in order to relate to all positions at FastCat, and relate to
FastCat success. The higher the job in terms of job evaluation points, the more value the job adds to the
company. The job structure is listed in the appendix, on page 36.
JOB STRUCTURE
The job structure is determined by compensable factors which are assigned a certain number of
job evaluation points. The compensable factors are weighted. This is because we believe some
compensable factors relate better to our compensation objectives than others do. For example,
innovation responsibility and interpersonal skill are both weighted at 40%. This is because they both
directly relate to our compensation objectives innovation and teamwork environment. Analytical,
technical, and management are then all weighted at 30%. This is because these skills are all necessary in
helping FasCat succeed (whether that be in terms of technical skills to help improve the product, analytical
skills to help evaluate the current product, or management to make sure every employee is doing their
job correctly). The experience skill is waited at 20% because valuable experience can help employees
become more successful in their new position. Certain job responsibilities from previous jobs can directly
relate to what the new job responsibilities would be at FastCat. Lastly, the education skill would only be
weighted at 10% because education provides valuable knowledge that would relate to the workplace, but
does not involve actual hands-on experience. In order to reach the compensation objective of internal
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equity, all seven compensable factors are weighted in order of importance. Descriptions of the
compensable factors are as follows:
COMPENSABLE FACTORS
Factor: Analytical Effort
Weight: 30%
Definition: The analytical capacity required to perform a job effectively. This includes analytical skills, and
the ability to interpret a situation and make a decision based on the information presented.
Explanation: Analytical effort is a necessary compensable factor for FastCat because it ties into
Compensation Objective C, which relates to innovation and external competitiveness. While the degree
may differ, analytical effort is necessary for success in all jobs at FastCat. In order to be continuously
innovative and externally competitive, FastCat needs employees to be able to assess different situations
that arise within their department and within the company and be able to bring fresh ideas to best deal
with those situations and put FastCat in a competitive market position. This analytical effort can range
from analyzing external competition and coming up with creative marketing ideas to attract and retain
customers to analyzing and finding ways to improve FastCats relationships with clients. In order to
enhance FastCats external competitiveness and support innovation, analytical effort must be a
compensable factor. See chart in appendix on page 37 for the explanations of how analytical effort is
ranked according to each individual job.
Factor: Education
Weight: 10%
Definition: The degree of education required to perform a job effectively.

Explanation: Education was chosen as a compensable factor because it needed to be tied into one of
FastCats compensation objectives, which is internal equity. By having clear education requirements
within each job description (determined by what is required to perform the job effectively), the company
will have internal equity because compensation will be related to the education requirements. By having
education as a compensable objective, it will help create internal equity because everyone will understand
how the jobs are ranked (and compensated fairly) regarding education. If employees see internal equity
within an organization, they will see the organization in a positive light because they are being treated
fairly. With internal equity, FastCat will be able to attract and retain top talent. By having top talent,
FastCat will be able to either keep up with or surpass rival companies because the employees will
contribute so much value. See chart in the appendix on page 37 for the explanations of how the education
is ranked according to each individual job.
Factor: Experience
Weight: 20%
Definition: The years and amount of relevant work and industry experience that is demanded of the
person holding the job.
Explanation: Experience ties into our desire for internal equity. Experience is a fairly objective metric of
predicting an employees performance and knowledge of an industry or job role. Compensating for
education will help to attract employees with lots of experience to come to the company, knowing that
they will be recognized for it. The importance of experience and seniority is inherent in many
organizations, and employees will be able to understand how their level of experience effects the pay
they receive. In addition it could encourage them to stay with the company knowing that they will be
compensated for increased experience. Please see the chart in appendix on page 38 for an explanation of
how experience skills are ranked for each individual job.

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Factor: Interpersonal skills

Weight: 40%
Definition: The ability to effectively work within a team based situation and deliver results in a timely
manner.
Explanation: Interpersonal skills were chosen as a compensable factor for FastCat because it needed to
be tied to one of FastCats compensation objectives, which in this case is team work
environment. Interpersonal skills are very important for FastCats overall success. No matter the job
position, each individual worker must possess the necessary skills, such as communication, in order to
complete the companys desired projects and be able to work efficiently within the confines of a team. A
teamwork environment will help all employees to focus on customer satisfaction and the companys
success as a whole. This will allow daily operations to function more smoothly and help create a better
work environment. FastCat highly values teamwork and a teams overall success as it continues to build
its future. Please see the chart in appendix on page 38 for an explanation of how interpersonal skills are
ranked for each individual job.
Factor: Technical Ability
Weight: 30%
Definition: The knowledge and ability needed to accomplish computer-related, scientific, mathematical,
and engineering tasks whether independently or in a team.
Explanation: Technical ability was chosen as a compensable factor for FastCat as technology plays a large
role in our company's progress. Technology allows us to move forward and keep up with others larger
companies. Technology is very important as the development of new software while still meeting the
current demand for our products. Because of this, the technical ability is related to the innovation business
objective. This is because the more FastCat employees innovate, the more that FastCat can compete with
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competitors by differentiating themselves. See chart in appendix on page 39 for the explanations of how
technical ability is ranked according to each individual job.
Factor: Innovation responsibilities
Weight: 40%
Definition: The creative ability that is necessary to come up with new ideas, including for products,
upgrades, new markets.
Explanation: Innovation was chosen as a compensable factor because it needed to be tied to one of our
compensation objectives, which is not surprisingly innovation. Innovation is important to help FastCat
succeed because in order for a company to be successful in the healthcare software market, the company
has to be ahead of the game. This essentially means thinking of and implementing new ideas and
updates for the healthcare software before the other rival companies do. For example, laws and
regulations are always changing in the healthcare market, so if FastCat can design software updates to
help these regulations easier for the clients, then FastCat will continue to have a strong client base and
following. If FastCat fails to provide innovative updates to the healthcare software, then clients could
possibly leave and go to a different company that does. See chart in appendix on page 40 for explanation
on how innovation is ranked according to each individual job.
Factor: Managerial responsibilities
Weight: 30%
Definition: The management tasks given to an individual, the level of the people they are assigned to lead,
and the consequences of poor leadership.
Explanation: Management was chosen as a compensable factor as it ties into our compensation objective
of a teamwork based work environment. Having a positions responsibility to manage a team is essential
to how the jobs will be structured, and in turn how those with increased responsibility should be
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compensated as such. Having it tied into compensated will ensure that those with management position
over high level technical jobs, such as engineers, are compensated for assuming that management role
while having advanced technical knowledge. The later stages will recognize those that have authority over
other high-level managers, and have increased responsibility with their decision making. See chart in
appendix on page 41 for explanation on how management is ranked according to each individual job.
Lastly, it is evident that we did not relate any individual compensation objectives to the
performance recognition business objective. This is because we believe that all of the compensation
objectives actually do relate to performance recognition, as well. This is because the point of the
development of the internal structure is to determine which jobs should be compensated more related
to what FastCat thinks is important, and vice versa. Employees will feel as if their hard work will be
compensated as it is outlined in their job description. Because of this, employee morale and productivity
will increase which will help FastCat succeed. FastCat will succeed because it will be able to attract and
retain top talent, which will in turn help FastCat create innovative updates to current product in order to
attract more customers.

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External Competitiveness
RECOMMENDED STRATEGY FOR COMPETITIVENESS
We at FastCat believe that we can compete with other firms by having pay levels that are above
the market rate for all jobs. FastCat needs these higher levels to compete with other firms and have the
best product on the market. Theses higher pay levels will enable FastCat to attract and retain the best
talent. Though we are aware of the risks that this could make our labor costs unsustainable, we believe
that we will make up for the higher labor costs in reducing turnover costs and more easily find people
willing to work for us.
We have made the decision to go higher above the market rate for those jobs that we have found
to be the most important and vital to the success of FastCat. We know that it is more difficult to attract
these people, as well as replace their services if they leave the company, and want to give them a higher
comparative rate to incentivize them against working for a competitor. For jobs with lower job
evaluations score we still want to go above the market, but acknowledge that these jobs are easier to fill
and have less of an impact on the business.
FastCat knows that have a mix of compensation forms is the best way to attract and retain talent.
Different workers look for higher bases or more competitive bonuses, so a mix is the best way to attract
workers. At the same time we acknowledge that our firm is a smaller company, and may have trouble
meeting the large cash base that other firms offer. We will structure bonuses so that they will make a
larger impact on the total compensation of sales positions, whose financial impact can be easily tracked
and will have incentives through commissions to get high sales numbers. This will accomplish our goal of
paying employees for their performance.

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All employees will be given stock options, with the amount tied to role within company; those at the
highest level will have the most. This will make those employees who have littler impact in the long term
goals of the company will not worry about how seriously it will effect total compensation, and those in
high level innovative position will be highly motivated to look for new ways of doing business. These stock
options will attract those in the industry who believe that they can change a company for the better.
Employees will have more dedication to their jobs if they are all partial owners.
The benefits that are given to any employee are a very important part of their compensation and
offering a competitive benefits package is essential to the success of FastCat. All employees will have
access to healthcare, both to keep all employees safe and healthy and to comply with laws. Regarding
paid time off there will be a base amount of 2-weeks for non-salaried employees and 3 weeks for salaried
employees, and employees who stay in the company for longer will increase this amount. This vacation
time will enable employees to decompress and hopefully be more efficient in their work.
We at FastCat want a compensation system that will encourage innovation, recognize employee
performance, and show internal equity. Leading the market with our pay levels and the mix of forms we
use to make up this compensation will accomplish all of these goals.
SURVEY DESIGN
A survey of external competitors is a necessary component to FastCat successfully creating a
compensation structure. A survey of external competitors will reveal what the market rate is for jobs
within the software industry. Working off of the market rate, FastCat can then decide what to pay for their
jobs in order to keep within the pay leader strategy mentioned above.
In order to create benchmark jobs, the descriptions of jobs within the Access Database and the
descriptions of jobs within FastCat had to be compared. This is in order to find the similar jobs between
the two sets of job descriptions. Please take a look at the Benchmark Jobs chart in the Appendix on Page
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46. This chart shows the rationale for why each FastCat job was matched up with the Access Database
jobs. Now that similar jobs have been picked out and compared, FastCat is now able to see how their jobs
are similar to other external jobs and then compare compensation between the two, as well. 15 external
jobs through the Access Database were decided to be very similar to FastCat jobs, and therefore were
decided to be benchmark jobs. Benchmark jobs are positions that remain consistent throughout the
industry (in this case, the software industry). Out of the 24 total jobs at FastCat, the 15 benchmark jobs
chosen is roughly 62.5% of the total of FastCat jobs. By choosing an amount of benchmark jobs that is
over 50%, FastCat is receiving more accurate data in order to adequately price the job structure.
In terms of deciding a relevant market, FastCat is a healthcare software company. Because of this,
it was decided to only focus on jobs within software companies. This is because software companies are
going to have very similar jobs compared to each other (i.e. technician, engineer, programmer, etcetera).
As of this rationale, 20 software firms were chosen as companies to be included in the survey (keep in
mind that these companies are also in the same geographic area). Within these 20 software firms, there
are 12 medium-sized firms and 8 small-sized firms. It was decided that large firms should not be included
within the survey. This is because larger companies have more revenue, and therefore have more money
to compensate their employees. Small firms also have less than 400 employees, and medium firms have
between 400-1,000 employees, and large firms have 1,000+ employees. Since FastCat only has 200
employees, it is considered a small firm. Hopefully in the near future, FastCat will grow to become a
medium-sized firm, and so the salary data is determined important as a reference. Although FastCat would
like to one day be a large company, right now it is not large enough to compare itself and its jobs to a
larger firm. So in summary, small and medium sized software firms were decided to be included within
the survey. This is in order to help create internal equity within FastCat, which is an objective.
Since it takes time to collect and analyze survey data, by the time it is received, the data is already
old. The survey data for FastCat was aged by 2% for the 6 months that the survey would take to be
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returned to FastCat. This percentage was determined by taking the inflation rate in the United States since
2011. This was then averaged and came out roughly to 2%. This is a rough estimate of how the survey
would change over the 6 months, and is not exact.
Total compensation was chosen by FastCat as the pay form to compare in the external survey
data. Total compensation is base + benefits + short-term and long-term incentives. The advantage of total
compensation and using it as a pay form to compare in the external survey data is the fact that it tells the
total value competitors place on this work (within each job). The disadvantage of using total compensation
as a pay form to compare externally is that all employees (within each job) may not receive all of the forms
(i.e. base + benefits + short-term and long-term incentives). FastCat will have to make sure that the
compensation schedule looks fair once complete because of this weakness. Total compensation as a pay
form to compare was also chosen because it directly relates to FastCats objective of internal equity. By
having the complete compensation schedule available to employees to view as divided by each section,
employees can clearly see what they will be compensation and from which area.
Weighted mean was chosen as the compensation metric to use in addition to the total
compensation pay form. Weighted mean would be that each companys mean (within the external market
survey) is weighted by the number of people in that company in that job. So a companys mean is first
found and then weighted. By finding a weighted mean, it can help identify pay trends more accurately.
This is because the weighted mean smooths out the fluctuations in the market (in case there are outliers
in terms of how much a job is compensated for).
R is a statistic that evaluates the goodness of the fit between the FastCat compensation
structure and the structure in the external market. The closer the R is to 1.00, the more similar FastCat
compensation structure is to the external market. The R for FastCat is 0.512. This is roughly more than
halfway to the 1.00 marker. This means that the FastCat compensation structure is roughly more than half

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as similar to the external compensation structure. Although FastCat only has a R of 0.512, this is not
alarming. This is because FastCat wants to lead the market in terms of total compensation for all jobs. By
leading the market in terms of total compensation, the less similar FastCat is to the market rate (or the
regression lines) in the Access Database Regression graph. Please take a look at this graph in the Appendix
on page 48. Please keep in mind that only benchmark jobs are being compared within the graph, which
means that not all jobs are not being compared, just the most similar. It is possible to improve the R. We
could evaluate the jobs that are currently outliers and make the compensation for them to be more in
line with the regression line.
Because FastCats objectives are to be externally competitive/innovative, providing a lead the
market compensation strategy directly aligns with this objective. This is because by paying our jobs above
market, this is attracting and hopefully retaining top talent to work for FastCat and helping the company
to become innovative and ahead of the times in order to stay competitive.
PAY POLICY LINE
After reviewing the recent inflation rate and aging the data to 2%, we at FastCat have chosen to
use two different policy lines. These consist of Policy Line 1, which is 10% above the market rate and Policy
Line 2, which is 2% above the market rate. As discussed above during the strategy section, FastCat needs
to have an above the market compensation strategy. In order to reflect this, both of the Policy Lines
chosen are above the going market rate (generally what competitors pay for a similar position). The
reason there are two different Policy Lines, one with a much higher rate than the other, is because of job
evaluation points. We believe that jobs with more job evaluation points should be rewarded with a higher
Policy Line. This is because these jobs are more integral to the success of FastCat as a business. The jobs
with the lower job evaluation points are more universal and not as integral to the success of FastCat, and
because of this do not have as high of a Policy Line rate. The total compensation package consists of a

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base, benefits, as well as short and long term incentives. We chose to use a total compensation package
as a pay form primarily because it will tell us the total value that FastCats competitors place on the work
performed by employees in each specific job as compared to by external survey data that is collected.
Both of the policy lines that we have chosen to use are both set above the going market rate, and reflect
total compensation for all of the jobs at FastCat.
These pay policy lines are consistent with FastCats overall strategy. We are looking to lead the
market with these percentages. By using these percentages, which are above the going market rate,
FastCat hopes to retain its employees and more importantly attract top talent. This is in line with FastCats
objectives of internal equity and external competitiveness/innovation.
Pay Policy 1 of 10% consists of the jobs that meet the overall objectives of FastCat, and received
a higher amount of job evaluation points. We have chosen this 10% policy line because these job
evaluation points are weighted heavily due to the high level of requirements such as skills, education,
years of experience, severity, etcetera which are required to complete said jobs. FastCat recognizes that
in order to be the leader of the market, these jobs have to be highly compensated and these are the key
factors that will help FastCat in the long run to retain its employees. Policy line 2 of 2%, although still
slightly above the going market rate, has lower job evaluation points. This is because the job positions
that fall under policy 2 do not relate fully to FastCat objectives. They are not weighted heavily do to fact
that they do not require as much skill and can be easily filled or replaced. They are more universal jobs
that can be found from one company to the next. After establishing these pay policy lines, we chose to
use a grades and ranges system which permits the integration of internal alignment and external
competitiveness. All jobs that fall within a grade are treated the same for compensation purposes. We
have chosen to use five grades. Our policy line 1 of 10% deals with Grades 3, 4 and 5, while Grades 1 and
2 deal with policy line 2 of 2%.

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INTEGRATION OF INTERNAL AND EXTERNAL STRUCTURE

When deciding between grades and ranges or job bands and zones, we felt that grades and ranges
best meets our internal equity objective. Every job is treated fairly and valued equally within each grade.
Grades and ranges also make it very clear how the jobs in each grade are valued and how much that value
changes between the grades. Part of the internal equity objective is transparency in our compensation,
and by using grades and ranges transparency is achieved.
Our grades have overlap, which facilitates career paths. This relates to our performance
recognition objective. If we have a talented employee that is not yet ready for a higher role in the next
pay grade, there is still room for promotion and compensation increases within the grade he or she is in.
The increase in compensation rewards the employee for the hard work that he or she has already put
forth and therefore recognizes that hard work. Once employees are ready to move between pay grades,
they are able to do so and the increase in total compensation is a way to recognize the work the employees
put in to achieve that increase in compensation.
Since the jobs in the lower pay grades have lower job evaluation points and there is a higher
supply of candidates in the market for those positions, employee turnover in those grades has less of an
impact on FastCat. There also isnt a large demand for innovation in those grades, which is why the grades
are more narrow than those positions with higher job evaluation points. There is less of a need for people
to move up in the lower grades than there is in the middle where more jobs are available. Flexibility is
more evident in mid-level jobs for promotion, which is why these grades are wider. The largest amount
of positions are included in the mid-level grades, which means there are more opportunities for
employees to be promoted within the grades. The highest grades contain top-level positions, and
therefore are more narrow. There is less flexibility for promotions because the people in this grade are
already at the top of the organization and therefore have little opportunity to go any higher than they

20

already are. The highest paid employees are in the highest grades because we need to retain those
employees, as turnover of positions included in those grades can indeed hurt FastCat since they are much
harder to fill than those job positions included in the lower grades.
EVALUATION OF DECISIONS
After evaluating the data, it was determined important to stick with the original strategy of having
a total compensation package that is higher for jobs that have more job evaluation points and lower for
jobs with less job evaluation points. Although some more jobs are more vital to the success of FastCat as
a whole, satisfied employees in all jobs is also important.
Small-medium sized software firms were chosen to be in the external survey. One of the reasons
for this decision is because FastCat is a healthcare software firm. This means that FastCat will have similar
jobs to other software firms (such as an engineer). In addition, FastCat (at having only 200 employees) is
considered a small firm. Comparing FastCat to a medium sized firm is okay, because that will be the next
growth range for FastCat and can give FastCat an idea of what compensation is like for medium-sized
firms. However, FastCat is too far away from being considered a large-sized firm and because of this the
compensation data from these firms was considered irrelevant. Benchmark jobs are key jobs that can be
found within one organization to another. They are almost universal. Please take a look at the
Benchmark Jobs table on page 46 in order to get a detailed rationale on why each benchmark job was
chosen and matched to a FastCat job.
We at FastCat want a compensation system that will encourage innovation, recognize employee
performance, and show internal equity. Leading the market with our pay levels and the mix of forms we
use to make up this compensation will accomplish all of these goals. In this way, Base + Bonuses + Benefits
+ Stock Options will be given to all viable sources.

21

The analysis on competitors pay practices is hard to say definitively. Please take a look at the
regression graph on page 48. Within this, you will see that some of the benchmark jobs from competitors
are above the market rate (an outlier) and some of the benchmark jobs from competitors are below the
market rate (an outlier). It really shows the difference between the pay practices of the firms because
some first showcase compensating their employees very highly, while others choose to stay below the
market rate. It is curious to know how employees are retained at below market rate employers. The
results of the analysis are examined by how the data of the external competitors match up with our own
ideas of how to compensate people. How we set ourselves apart is based off of the current industry
standards. The benchmark jobs that we had decided closely matched our FastCat jobs ended up having a
very different range in terms of total compensation. There is not a strong correlation of all of the jobs in
terms of what the companies decide to pay in total compensation, it depends on the organization.
2 policy lines were chosen, although both above the market rate. Policy 1 is 10% above the market
rate, whereas Policy 2 is 2% above the market rate. FastCat management decided to have a Policy 2 (lower
than Policy 1) because of jobs that do not carry as many job evaluation points and are easily filled/do not
require as much skill. Compensation for this jobs do not have to be quite as high because they do not
directly relate to the success of FastCat objectives. Grades 1 and 2 were put under Policy 2 because of
lower job evaluation points, whereas Grades 3, 4, and 5 are put under Policy 1 because of higher job
evaluation points and more contribution to the success of FastCat through objectives.
Our new compensation strategy of leading the market helps FastCat becomes a compensation
leader within the software market. It attracts and retains the top talent which is necessary to our
innovation objective in order for FastCat to remain relevant and compete with the larger organizations in
the software. External competitiveness is very important to FastCat as it is an objective and this
compensation strategy also helps with this.

22

Performance and Management

PERFORMANCE-BASED PAY PLAN STATEGY
There are three different types of performance-based plans available to FastCat. The first is the
merit pay plan. According to the Compensation textbook on page 685, the merit pay plan is a reward
that recognizes outstanding past performance. The merit pay plan recognizes individual performance
and pay different amounts based on the level of performance. The second type of performance-based pay
plan is the gainsharing plan. According to page 681 in the Compensation textbook, a gainsharing plan is
an incentive plan that is based on some measure of group performance rather than individual
performance and can focus on either cost savings or profit increases as the standard for distributing the
excess funds among employees. The third plan is the profit-sharing plan. Page 688 of the text states that
the profit-sharing plan is a plan that focuses on the profitability of the company as a standard for group
incentive.
Between the merit, gainsharing, and profit sharing performance-based pay strategies, we decided
that the merit pay plan is best suited to achieve FastCats objectives. According to Exhibit 26 in the case
book, the merit pay plan signals meritocracy, puts significance on individual contributions, fosters longterm commitment and controls costs. Basing part of our employees pay on performance will help FastCat
compete because it may increase employee satisfaction as their hard work is continually recognized. If
employees are satisfied, FastCat will retain the high caliber employees we seek. Since performance will
be recognized through annual employee performance appraisals, it will help achieve FastCats objective
of internal equity because it will be clear how to improve performance in order to achieve the
performance-based bonuses. It is our hope that performance-based pay will create an incentive for all
employees to continually perform well and work hard to contribute to the success of FastCat. Since

23

performance appraisals will be reviewed with the employees, we hope that the information will push
those employees with satisfactory performance to perform even better in order to achieve an increased
bonus while still rewarding the employees with great to outstanding performance for their contributions.
ASSESSMENT OF CURRENT SALARIES
Employee salaries mainly have to do with the FastCat objectives of external competitiveness and
internal equity. FastCat is concerned with having a market leader strategy in terms of total compensation.
This is in order to attract the top talent in order to help make FastCat successful. Because of this, all of
FastCat salaries are above the average market rate (by either 10% or 2%, dependent on job evaluation
points), which helps keep the employee salaries consistent with one of FastCats objectives (please see
the table on page 38). The other objective, internal equity, is just as important as external
competitiveness. In order to achieve internal equity, all jobs were ranked and assigned job evaluation
points in regards to their importance to FastCat (please see the job structure table on page 36). The more
job evaluation points a job receives, the higher a pay grade the job will have. For more detail about what
jobs are within each pay grade, and what the salary range is in each pay grade, please see the table on
page 49. Overall, because each of the jobs are assigned to each pay grade determined on job evaluation
points, the employee salaries are also consistent with the internal equity objective that FastCat has.
Green circle rates are people within a job that are being paid lower than what the lowest allowed
amount is for that job within the grade it is assigned. Red circle rates are quite the opposite. Red circle
rates are people within a job that are being paid higher than what the highest allowed amount is for that
job within the grade that it is assigned. There were four green circle rates and five red circle rates found
within the employees at FastCat. There are multiple ways to treat each situation. For green circle rates,
the most obvious course of action is to give the employee a raise so that they are at least making the
lowest amount allowable within the grade that the job is assigned. For red circle rates, if performance is
low, pay can also be lowered. There is a possibility of demotion, or even promotion to a new job in a
24

different pay grade in order to fix the issue. Please see the Initial Salary Adjustments rationale on page
51 for more detail about the salary adjustments that were made.
DESIGN OF MERIT PAY PLAN
The goal of the Merit Pay Plan is for it to support our compensation objectives. We wanted to
create an environment of internal equity and foster teamwork, where all feel that they can increase their
pay for improving their performance and that of those around them. All employees with a performance
meeting requirements will receive a merit increase, this will keep our competent staff pay competitive
and decrease the chances of them switching jobs. It is our goal to lead the market in pay, and as such our
Merit Grid gives the highest increase to those with the highest performance but are in the lower quartile,
this allows our highest performing employees to quickly catch-up to market levels. We were careful about
how to give merit increases to those in the high quartile levels, but knew that we must recognize their
performance, even if it less of an increase for those at lower levels. Only 25% of employees will receive
ratings of 4 or 5, and those with those scores will not receive any merit increases. We believe this aligns
with our objective of performance recognition, and would be wrong to increase the pay of those not
meeting all requirements. Differentiation of pay based on performance is necessary for FastCat to stay
competitive and retain the best talent, our Merit increases will reduce employee turnover and encourage
high performance. While we are aware that our Merit increases may seem small, employees will stay
competitive with high base and the bonus structure.
DESIGN OF BONUS PLAN
The highest weighted features of our Balanced scorecard are those that tie into our compensation
objectives. These bonuses will seek to reward our most vital staff for the overall success of the company
with all employees outside of Grades 1 and 2 are eligible for a bonus. While there might be ill feelings
amongst the lower grades about not being included in the bonus payout, we must recognize their lower
impact on the business. The potential for bonuses will increase the performance of higher rank staff while
25

also attracting and retaining those who believe that they can achieve high goals. The payout of bonuses
makes the biggest impact on the compensation of those who are responsible for selling the product, as
their performance can be the most easily quantifiable. The drive to reach revenue targets and receive
their full bonus will push our sales staff to their fullest potential. Outside of sales jobs, all members of
each tier will receive a flat rate of the bonus payout. We believe that it is difficult to quantify the
performance of no sale staff into a bonus payout and to try and do such might disturb our goal of internal
equity. Under these current structures an average employee in the qualifying tiers, with the outliers of
the sales staff removed, will have a projected bonus of approx. $12,000.
CONSIDERATION OF OTHER PERFORMANCE-BASED PLANS
The three performance based pay systems that best fit FastCat are a merit pay plan, profit sharing
and gainsharing plans. Though it would be optimal for FastCat to simply use a merit pay plan, one or both
of the remaining plans could be implemented into one large group incentive plan. There are some
advantages and disadvantages to using group incentive plan. According to the compensation textbook on
page 359, some advantages include a positive impact on the organization and individual performance,
easier to develop performance measures than it is for individual plans, signals that cooperation, both
within and across groups, is a desired behavior, teamwork meets with enthusiastic support from most
employees, may increase participation of employees in the decision making process, etc. According to the
compensation textbook on page 359, some disadvantages include line of sight may be lessened, that is
employees may find it more difficult to see how their individual performance affects the incentive
payouts, may lead to increased turnover among top individual performers who are discouraged because
they must share with less contributors, increase compensation risk to employees because of lower
income stability , may influence some applicants to apply for jobs in firms where base pay is a larger
compensation component, etc. FastCat may also choose to implement long term incentives down the

26

road, as well as offer ESOPs, employee stock ownership plans. These will give the employees more reasons
to stay with the company and continue to build seniority over time.
BENEFITS
FastCats compensation strategy is one of total compensation. That is, we want potential
employees and current employees to look at the big picture rather than just their base wage. Because of
this, total compensation for FastCat employees includes the base wage + bonuses + merit pay + benefits.
Because benefits are so important to everyone (i.e. health and dental insurance, life insurance, 401(k) and
retirement plans), we felt it important to include it within the total compensation strategy for FastCat.
This way nothing is hidden from employees, and employees will understand that they are making more
than initially thought with benefits prices included. Benefits ties into the external competitiveness
objective because of how benefits measure up to other companies, and in order to attract top talent
benefits are a key tool in doing so.
As discussed in the External Competitiveness portion of the report right before this, only smallmedium sized software firms were chosen to be used for benchmarking. This is because FastCat is
considered a smaller company, so comparing FastCat to jobs that are larger and/or in a different industry
is irrelevant. Jobs between small-medium sized software companies are going to be very similar, so the
pay between them must be similar as well in order to be competitive in the external market.
Most of the competitors base pay ratio for benefits is about 10% or lower. For example, Company
45 pays their Engineer 2 total compensation of $162,534. Within that total compensation, $12,657 of that
is for benefits, which is around 7-8% of total compensation. Because most of the selected competitors
paid out around that amount for benefits, in order to keep FastCat within its pay leader compensation
strategy, benefits payout is set at about 10% of total compensation amount. This is still higher than most

27

selected competitors, and will help help FastCat attract top talent and remain competitive in the external
market. See below for some examples:
Company Survey JobBase
Company 45 Engineer 4
Company 33 Engineer 2
Company 38 Engineer 4

Bonuses Total Cash Stock Options Benefits Total Compensation Benefits Ratio
$0.00 $12,657.00
$162,534.00
7.80%
$94,558.00 $9,729.00 $104,287.00
$65,800.00 $11,483.00
$181,570.00
6.30%
$110,615.00
$0.00 $110,615.00
$0.00 $11,658.00
$120,279.00
9.70%
$147,777.00 $2,100.00 $149,877.00

HOW THE RECOMMENDATIONS WILL HELP ACHIEVE OBJECTIVES

Most employees pay was not initially adjusted into the pay structure. However, there were a few
employees with base pay that did not match their performance or length of time with the company. For
example, two Clinical Liaisons had a very large difference in their base pay. One employee, L. Belfer has
performed satisfactorily and has been in the company for less time than B. Hillman, who has been
exceeding performance expectations. This led us to decide to lower the base pay of both employees to
$70,000 for Belfer and $75,000 for Hillman and make commission a larger portion of pay due to the sales
qualities of this position. By doing this, we ensured that both employees could make even more money
than the initial set up because of the increase in commission-based pay while encouraging top sales. We
also decided to switch both employees because Belfer had to take a large pay cut in her base salary, and
it wouldnt be equitable to only change the way she is paid for the same job title. The majority of the
employees who did receive initial adjustments were simply to pay them fairly based on their performance
and length of time with the company. Most of the changes in base salary were increases. The total costs
of our initial adjustments for each employee came to $65,315. Adjusted base pay represents 81% of
FastCats total compensation costs. One reason we adjusted our employees base pays was to help FastCat
achieve our internal equity objective. We want to be clear and fair in the compensation of our employees,
and we arent being fair to all employees if they are being paid too little or too much for the contributions
and commitment they have exhibited while being with FastCat.

28

Merit increases were given to employees based on satisfactory and above satisfactory
performance and the quartiles each employee fell into. Employees in Quartile four with satisfactory
performance received a merit increase of .50%. Those with above satisfactory performance received 1%
and those that far exceeded requirements received a 2% increase. The employees in Quartile four receive
the highest pay, so their merit increases are smaller than those in the lower quartiles. Employees who
receive smaller compensation packages are included in Quartile one, and receive a merit increase of 3%,
4%, and 5% for satisfactory, above satisfactory, and outstanding performance, respectively. The total cost
of our merit plan is $86,449 with 92% of our employees receiving merit pay. Merit increases comprise
only 2% of FastCats total compensation costs. Since this part of the pay plan is based heavily on
performance, this helps FastCat achieve its objective of performance recognition. Employees who perform
well should be compensated accordingly as a reward for their contributions. With our merit plan, the hard
work of employees is recognized and rewarded each year.
Bonuses are given to employees based on the balance scorecard we created and on company
performance. The highest valued aspects of the balanced scorecard are innovation, customers finding
FastCat representatives knowledgeable and responsive, customers value FastCat solutions, and
employees take pride in working for FastCat. 80% of FastCat employees receive bonuses should the
balanced scorecard goals be met, with the total bonus pay equalling $330,460 for all employees. Bonuses
comprise 9% of FastCats total compensation costs. By offering bonuses based on FastCats performance,
the teamwork environment objective is met. This type of reward fosters employee commitment to the
organization, and committed and satisfied employees must work together to help FastCat achieve success.
By rewarding employees with bonuses in addition to the merit pay, employees are rewarded for both
their individual contributions to FastCat and their contributions to the team.
Not only do FastCat employees receive a base pay, merit pay, and bonuses, they also receive
benefits. Benefits, including health care, life insurance, etc; are about 10% of employees adjusted base
29

pay. The total cost of our benefits is $321,156 and represents about 8% of FastCats total costs for
compensation. This is in line with FastCats external competitiveness objective. FastCats employees are
very valuable, and in order to attract and retain top talent, FastCat must show employees how valuable
they are. Our benefits plan can help achieve that. The current salary structure that we have created can
help FastCat achieve all of its compensation objectives, from valuing employees and their performance to
being externally competitive. Our strategy also leads the market in total compensation, a strategy that we
believe will help FastCat stay externally competitive. At this time, there are no individuals or jobs that
require further investigation.
STRATEGY FOR MANAGING THE SYSTEM
FastCat will implement a database system which will monitor its employees and the work being
completed. Through the use of our databases, FastCat will be able to see the parameters of each the three
phases. We will set the percentages and other factors to our wants and if some issues arise, they will be
fixed according to our projected numbers that the company strives to achieve.
FastCat is going to be upfront and honest with its employees. Nothing will be hidden from the
employees. During their performance appraisals, the employees will be told about their salaries, which
include the amounts for both base pay and benefits, as well as their overall standing in the company and
where they can improve their efforts.
FastCat wants to offer the best compensation package it can in order to retain its employees for
as long as possible. The company is concerned with wanting to be the market leader and is going to pay
out 10 percent of the total compensation package. The company will offer its employees a variety of
benefits which will primarily include things like health and dental, life insurance, a 401k program, etc. Each
employee is different and may want some benefits that others do not want. They may choose out of a
select amount what they want and company will help them to meet their needs.

30

No system is perfect. FastCat will strive to continue to improve upon its ideas for changes both in
the short and long term run. Some things like perhaps combining job or rewriting job descriptions and
even creating a new performance appraisal system to better evaluate the employees are ideas that are
being discussed about. However, the company likes the current setup and will reassess it at the end of
the year or earlier if significant issues arise, and see what needs immediate changes.

31

Conclusion
In order for FastCat to succeed in this ever-changing healthcare software market, FastCat will have
to find employees that meet its compensation objectives (qualities of which are outlined in the job
description). These compensation objectives include: internal equity, teamwork environment, innovation,
and performance recognition. Internal equity is important for FastCat so that employees feel that they
are being treated fairly. Because of this, retention and productivity should increase. A teamwork
environment creates an opportunity for employees to feed ideas off of each other and collaborate, which
will lead to more successful projects. Innovation would attribute to FastCats success because new and
improved updates for the current healthcare software and new ideas will keep FastCat ahead of the
competition. Performance recognition will attribute to FastCats success because employees will work
harder if they feel they are being recognized either in the way of competition or verbal sayings.
The seven compensable factors that relate to the business objectives for FastCat and determine
the job structure are: Analytical Effort, Education Skill, Experience Skill, Interpersonal Skill, Technical Skill,
Innovation Responsibility, and Management Responsibility. Again, these compensable factors were
carefully chosen in order to relate to every position offered at FastCat, and relate to the success of FastCat.
They are related to the business objectives listed above (for example, the innovation responsibility is
related to the innovation business objective). Although none of them were directly related to
performance recognition, we believe that all of them have to do with performance recognition because
the compensable factors are determined by what is important at FastCat. Because of this, employees are
being rewarded for their performance with compensation. Employees will be compensated the more of
the compensable factors that they have. All of the compensable factors were weighted on importance
and value added to FastCat. For example, innovation responsibility and interpersonal skill compensable

32

factors directly relate to the innovation and teamwork environment compensation objectives. After
determining the amount of points rewarded to each job description and then weighting the points,
FastCat now has an internal structure. The higher the job in terms of job evaluation points, the more value
the job adds to the company. Now with this internal structure developed, FastCat will be able to relate its
jobs to its compensation objectives and create success from it.
Now that the internal structure was developed, it was time to compare the internal structure of
FastCat and compare it to competitors. In order to remain competitive, FastCat must appeal to potential
employees out in the workforce to draw them from competitors payrolls. Not only does FastCat have to
attract these potential employees, but FastCat also has to retain them. In order to do so, an external
survey was created in order for FastCat to understand what competitors are paying for similar jobs and
how FastCat can beat that. A total compensation package was chosen in order to create interest in the
amount of benefits/stock options offered through FastCat. Pay Policy lines were created in order to
accurately reward employees. Pay grades/ranges were decided in order to showcase the most clarity for
employees in order to appeal to internal equity. Now that FastCat has learned about the external
environment and related its internal structure to it, FastCat can go about finalizing details about its
compensation system.
Individual salaries and performance scores were then evaluated in order to determine outliers
and any course of action. Any red circle rates or green circle rates were given the best possible solution
at this time. A merit-based system and then bonus system was developed in order to stick with the
performance recognition objective discussed earlier in this report. Benefits were determined to be about
10% of the total compensation, in order to still lead the market in terms of comparisons to most of the
other small-medium sized software companies. Please take a look at the graph on page xx in order to view
the entire picture of what was developed. Since this is the first year that this new compensation system
will be used, it will be evaluated on its effectiveness after it has been in effect for one year. This could be
33

done by implementing an employee survey in order to get employees opinions, and also by viewing
productivity levels.

34

Appendix
STRATEGIC MAP
Importance

35

JOB STRUCTURE
Job Title
Visionary Champion
Administrative Leader
Senior Fellow
Client Account Leader
Software User Interface Architect
Senior Quality Assurance Tech
Project Leader
User Interface Designer
Software Engineer
Graphic Designer
Quality Assurance Analyst
Quality Assurance Analyst A
Programmer Analyst
Software Solutions Consultant
Implementation Consultant
Training Assistant
Clinical Liaison
Administrative Assistant II
Marketing Services Representative
Marketing Support
Travel Coordinator
Technician
Project Support Assistant
Administrative Aid

Job Evaluation
Points
277.5
275
272.5
267.5
265
250
235
235
187.5
182.5
182.5
182.5
160
160
157.5
150
142.5
137.5
135
120
117.5
115
115
110

36

COMPENSABLE FACTORS
Analytical Effort
Point
Value

Weight

Description of Characteristics

50

30%

Analytical skills may be necessary occasionally, but is not necessary most of the time.
The individual seldom needs to contribute to the creation of solutions to situations.
Most work is independent and straightforward.

75

30%

Analytical skills are important about 25% of the time. Contributes ideas to discussion
of situations and can provide insight to analyzing information. Seldom comes up
with creative solutions and very little focus on innovation.

100

30%

Analytical skills are important about 50% of the time. This individual makes
suggestions for solutions to situations that must be approved prior to execution.
Occasionally suggests creative solutions and occasional focus on innovation.

125

30%

Analytical skills are very important to the job position. Independent decisions must
be made according to each situation, however important decisions must be
approved by a manager prior to execution. Regularly finds creative solutions to
problems and focuses on innovation.

150

30%

Analytical skills are vital to success in the position. The individual is constantly
analyzing data and situations and making independent decisions based on the
available information. The individual makes the final decision for every situation.
Constantly finds creative solutions to problems and changes current way of thinking.

Education Skill
Point Value

Weight Description of Characteristics

50

10%

High School Diploma

75

10%

Some College/Associates Degree/Certification

100

10%

Bachelors Degree

125

10%

Masters Degree

150

10%

Doctorate

37

Experience Skill
Point
Value

Weight

Description of Characteristics

50

20%

0 years / Entry Level

75

20%

2 - 4 years

100

20%

5-7 years / Including supervisory experience

125

20%

8 - 12 years / 3- 5 in supervisory role

150

20%

12+ years / 5+ in supervisory

Interpersonal Skill
Point
Value

Weight

Description of Characteristics

50

40%

Works primarily independently, but demonstrates team member abilities.

75

40%

Good communication skills. Can work as a team member or individually.

100

40%

Can be both placed in a leadership or follower position when needed,

Demonstrates effective communication skills, Can work well within a team and
independently , Delegate and perform tasks efficiently

125

40%

Effective communication skills, high team member status. Task oriented

150

40%

Goes above and beyond while working in a fully team based situation,
Demonstrates the highest ability to complete any given task

38

Technical Skill
Point
Value

Weight

Description of Characteristics

50

30%

Technical ability may be necessary occasionally, but is not necessary most of the
time. Most work is independent and straightforward.

75

30%

Technical abilities are important about 25% of the time. Contributes information to
discussion of situations and can provide insight to analyzing information.

100

30%

Technical abilities are important about 50% of the time. Contributes information to
discussion of situations and can provide insight to analyzing information. This
individual makes suggestions for solutions to situations that must be approved
prior to execution.

125

30%

Technical abilities are very important to the job position. Independent decisions
must be made according to each situation, however important decisions must be
approved by a manager prior to execution.

150

30%

Technical abilities are vital to success in the position. The individual is constantly
analyzing data and situations and making independent decisions based on the
available information. The individual makes the final decision for every situation.

39

Innovation Responsibility
Point
Value

Weight Description of Characteristics

50

40%

Seldom takes the time to think of ways to improve the current products, develop
new products, or look into new markets.

75

40%

On occasion will take the time to independently research new upgrades, new
products, or new markets.

100

40%

Frequently is required by the job description to independently take the time to

research new and improved processes, products, improvements, markets.

125

40%

Required by the job description to work in groups to develop new and improved
processes, improvements on current products, and future products/markets.
Required to present this information to supervisors.

150

40%

Required by the job description to supervise and implement new and improved
processes, improvement on current products, and future products/markets.
Required to make sure this is a successful endeavor.

40

Management Responsibility
Point
Value

Weight Description of Characteristics

50

30%

Employee has no management responsibilities, other than keeping themselves

accountable.

75

30%

Manages 1-2 junior level employees, has taken on training and evaluating of them

100

30%

Can lead teams of both juniors and peers, maintain ownership of projects, am
accountable for both self and direct reports

125

30%

Manager of mid-level employees, takes ownership and responsibility of company

critical tasks, can evaluate the individual and managerial ability of those below them

150

30%

Management of senior level staff, act as decision maker for many chains of
command, be able to work with senior staff in all departments

41

JOB RANKING EVALUATION

Implementation consultant
Point Value Weight Total Factor
Point Value
125
30%
37.5 Analytical effort
75
100
10%
10
Education
100
75
20%
15
Experience
75
125
40%
50
Interpersonal skills
75
50
30%
15
Technical ability
150
100
40%
40
Innovation responsibilities 50
50
30%
15
Managerial responsibilities 50
182.5
Marketing Support
Programmer Analyst
Factor
Point Value Weight Total Factor
Point Value
Analytical effort
50
30%
15
Analytical effort
100
Education
100
10%
10
Education
100
Experience
75
20%
15
Experience
50
Interpersonal skills
75
40%
30
Interpersonal skills
50
Technical ability
50
30%
15
Technical ability
150
Innovation responsibilities 50
40%
20
Innovation responsibilities 75
Managerial responsibilities 50
30%
15
Managerial responsibilities 50
120
Software Solutions Consultant
Software Engineer
Factor
Point Value Weight Total Factor
Point Value
Analytical effort
125
30%
37.5 Analytical effort
75
Education
100
10%
10
Education
100
Experience
75
20%
15
Experience
100
Interpersonal skills
75
40%
30
Interpersonal skills
100
Technical ability
100
30%
30
Technical ability
75
Innovation responsibilities 125
40%
50
Innovation responsibilities 75
Managerial responsibilities 50
30%
15
Managerial responsibilities 50
187.5
Graphic Designer
Factor
Analytical effort
Education
Experience
Interpersonal skills
Technical ability
Innovation responsibilities
Managerial responsibilities

Weight
30%
10%
20%
40%
30%
40%
30%

Total
22.5
10
15
30
45
20
15
157.5

Weight
30%
10%
20%
40%
30%
40%
30%

Total
30
10
10
20
45
30
15
160

Weight
30%
10%
20%
40%
30%
40%
30%

Total
22.5
10
20
40
22.5
30
15
160

42

Marketing Services Representative

Factor
Point Value
Analytical effort
100
Education
100
Experience
75
Interpersonal skills
75
Technical ability
50
Innovation responsibilities 50
Managerial responsibilities 50
Senior Quality Assurance Tech
Factor
Point Value
Analytical effort
125
Education
75
Experience
100
Interpersonal skills
150
Technical ability
150
Innovation responsibilities 125
Managerial responsibilities 100

Weight
30%
10%
20%
40%
30%
40%
30%

Total
30
10
15
30
15
20
15
135

Technician
Factor
Analytical effort
Education
Experience
Interpersonal skills
Technical ability
Innovation responsibilities
Managerial responsibilities

Administrative Aid
Weight Total Factor
30%
37.5 Analytical effort
10%
7.5
Education
20%
20
Experience
40%
60
Interpersonal skills
30%
45
Technical ability
40%
50
Innovation responsibilities
30%
30
Managerial responsibilities
250
Software User Interface Architect
Administrative Assistant II
Factor
Point Value Weight Total Factor
Analytical effort
125
30%
37.5 Analytical effort
Education
100
10%
10
Education
Experience
125
20%
25
Experience
Interpersonal skills
150
40%
60
Interpersonal skills
Technical ability
150
30%
45
Technical ability
Innovation responsibilities 125
40%
50
Innovation responsibilities
Managerial responsibilities 125
30%
37.5 Managerial responsibilities
265

Point Value
75
50
50
50
75
50
50

Weight
30%
10%
20%
40%
30%
40%
30%

Total
22.5
5
10
20
22.5
20
15
115

Point Value
50
50
50
75
50
50
50

Weight
30%
10%
20%
40%
30%
40%
30%

Total
15
5
10
30
15
20
15
110

Point Value
75
50
75
75
100
50
50

Weight
30%
10%
20%
40%
30%
40%
30%

Total
22.5
5
15
30
30
20
15
137.5

43

Clinical Liaison
Factor
Analytical effort
Education
Experience
Interpersonal skills
Technical ability
Innovation responsibilities
Managerial responsibilities
Administrative Leader
Factor
Analytical effort
Education
Experience
Interpersonal skills
Technical ability
Innovation responsibilities
Managerial responsibilities

Point Value
75
100
100
100
50
50
50

Weight
30%
10%
20%
40%
30%
40%
30%

Total
22.5
10
20
40
15
20
15
142.5

Project Leader
Factor
Analytical effort
Education
Experience
Interpersonal skills
Technical ability
Innovation responsibilities
Managerial responsibilities

Project Support Assistant

Point Value Weight Total Factor
125
30%
37.5 Analytical effort
75
10%
7.5
Education
100
20%
20
Experience
150
40%
60
Interpersonal skills
150
30%
45
Technical ability
150
40%
60
Innovation responsibilities
150
30%
45
Managerial responsibilities
275
Client Account Leader
Quality Assurance Analyst
Factor
Point Value Weight Total Factor
Analytical effort
125
30%
37.5 Analytical effort
Education
100
10%
10
Education
Experience
125
20%
25
Experience
Interpersonal skills
150
40%
60
Interpersonal skills
Technical ability
100
30%
30
Technical ability
Innovation responsibilities 150
40%
60
Innovation responsibilities
Managerial responsibilities 150
30%
45
Managerial responsibilities
267.5

Point Value
100
100
100
125
125
125
125

Weight
30%
10%
20%
40%
30%
40%
30%

Total
30
10
20
50
37.5
50
37.5
235

Point Value
50
50
75
75
50
50
50

Weight
30%
10%
20%
40%
30%
40%
30%

Total
15
5
15
30
15
20
15
115

Point Value
100
75
75
100
150
75
50

Weight
30%
10%
20%
40%
30%
40%
30%

Total
30
7.5
15
40
45
30
15
182.5

44

Quality Assurance Analyst A

Factor
Point Value
Analytical effort
100
Education
75
Experience
75
Interpersonal skills
100
Technical ability
150
Innovation responsibilities 75
Managerial responsibilities 50
Senior Fellow
Factor
Analytical effort
Education
Experience
Interpersonal skills
Technical ability
Innovation responsibilities
Managerial responsibilities

Weight
30%
10%
20%
40%
30%
40%
30%

Total
30
7.5
15
40
45
30
15
182.5

Travel Coordinator
Factor
Analytical effort
Education
Experience
Interpersonal skills
Technical ability
Innovation responsibilities
Managerial responsibilities

User Interface Designer

Point Value Weight Total Factor
125
30%
37.5 Analytical effort
150
10%
15
Education
150
20%
30
Experience
125
40%
50
Interpersonal skills
150
30%
45
Technical ability
125
40%
50
Innovation responsibilities
150
30%
45
Managerial responsibilities
272.5
Training Assistant
Visionary Champion
Factor
Point Value Weight Total Factor
Analytical effort
100
30%
30
Analytical effort
Education
100
10%
10
Education
Experience
50
20%
10
Experience
Interpersonal skills
100
40%
40
Interpersonal skills
Technical ability
50
30%
15
Technical ability
Innovation responsibilities 75
40%
30
Innovation responsibilities
Managerial responsibilities 50
30%
15
Managerial responsibilities
150

Point Value
75
50
50
75
50
50
50

Weight
30%
10%
20%
40%
30%
40%
30%

Total
22.5
5
10
30
15
20
15
117.5

Point Value
150
100
50
125
150
150
50

Weight
30%
10%
20%
40%
30%
40%
30%

Total
45
10
10
50
45
60
15
235

Point Value
150
100
100
150
150
150
125

Weight
30%
10%
20%
40%
30%
40%
30%

Total
45
10
20
60
45
60
37.5
277.5

45

BENCHMARK JOBS
FastCat Job

Job Evaluation
Points

Benchmark Job
Selected

Rationale

Administrative Aid

110

Office Support 1

Entry-level and high school

diploma. Simple data entry.

Training Assistant

150

Office Support 3

2 years experience. Proficiency

with Microsoft Office software.

Administrative
Leader

275

Office Support 6

Responsible for entire

administrative group.

Marketing Support

105

Marketer 2

Marketing Services
Representative

135

Marketer 3

Required Bachelor's degree.

Interacts with coworkers/customers about
products.
Required Bachelor's degree.
Participate in marketing
presentations.

Visionary
Champion

278

Marketer 5

Plans overall strategy. Research

new products/improvements.

Client Account
Leader

268

Marketing
Manager 3

Identify client needs and manage

the strategy for the presentation
of the product. Supervisor of
many different employees.

Technician

115

Technician 1

No experience required.
Participation in testing of
software programs.

Programmer
Analyst

160

Technician 4

Evaluates and tests new software

to ensure validity.

Senior Quality
Assurance
Technician

250

Technician 5

Responsible for complete

performance evaluation of
FastCat products through testing.

Software Engineer

188

Engineer 2

User Interface
Designer

235

Engineer 4

Develops/designs/creates
software programs. Assists in
development of testing
assignments.
Designs and develops complex
programs. Submits
analysis/research on user design.

Project Leader

235

Engineering
Manager 1

Provide supervision and direction.

Ensure the design and
development of product.

46

Software User
Interface Architect

265

Engineering
Manager 2

Establishes work
environment/supervision. Creates
blueprints/schedules of software
development.

Senior Fellow

272

Engineering
Manager 3

Reviews engineering
work/managers engineers.
Provide guidance on complex
issues.

47

FASTCAT ACCESS DATABASE II GRAPHS

Regression

Grades & Ranges

48

FASTCAT ACCESS DATABASE II DATA

Grades Data

Grade 1
Policy:

Policy2

JE Points

Salary

Low

105

Low

45379.45

Mid

112.5

Mid

51567.55

High

57755.66

High

120

Range

12 %

Grade 2
Policy:

Policy2

JE Points

Salary

Low

121

Low

54389.58

Mid

135.5

Mid

73499.43

High

92609.28

High

150

Range

26 %

Grade 3
Policy:

Policy1

JE Points

Salary

Low

151

Low

88209.1

Mid

167

Mid

111657.1

High

183

High

135105.1

Range

21 %

Grade 4
Policy:

Policy1

JE Points

Salary

Low

184

Low

121608.3

Mid

212

Mid

157932.8

High

240

High

194257.3

Range

23 %

Grade 5
Policy:

Policy1

JE Points

Salary

Low

241

Low

179898.1

Mid

259.5

Mid

206779.4

High

233660.7

High

278

Range

13 %

49

Survey Data on Selected Benchmark Jobs (Example Summary)

Engineer 2

188

JE Points:
Number of
225

Incumbents:

Base Salary

Total Cash

Total Compensation

Weighted Mean:

$72,962.65

Weighted Mean:

$76,113.05

Weighted Mean:

$100,893.74

Mean:

$73,952.84

Mean:

$76,247.10

Mean:

$100,562.01

50th:

$71,900.68

50th:

$75,121.39

50th:

$94,140.24

25th:

$67,447.81

25th:

$70,100.37

25th:

$86,705.73

75th:

$77,663.21

75th:

$79,627.71

75th:

$101,848.52

Bonuses
Mean

Stock Options
$5,063.14

Mean

$22,082.75

As a % of Base

7.05%

As a % of Base

30.86%

% who Receive

62.22%

% who Receive

53.33%

50

Initial Salary Adjustments

Name & Current Job
Title
Belfuer, L. & Hillman, B.
Clinical Liaison

Rationale

Drabik, H.
Graphic Designer

Drabik, H., one of the graphic designers, has the highest

performance score, has been in the job longer than the other
graphic designer, and is making less at $127,800. Irvine,
P.s current salary is currently $132,400, which performance
only satisfactory at a 3. Drabik, H.s salary is increased to
$133,500.

Yanadori, J.
Programmer Analyst

Currently makes $86,700 which is under the lowest amount

which is $88,209. Performance is satisfactory so the
employees wage will me moved up to $88,209.

Mahoney, T.
Project Leader

Currently makes $114,500. Has been in the job for 6 years,

and the performance is above satisfactory. Since the pay is
under the minimum amount of $121,608, the pay is
increased to $121,608.

Ragusa, H.
Project Support Assistant

Because this person currently makes over the allowed

maximum amount, and also has the highest performance
possible, it makes the most sense to move Ragusa into a
different job that has a higher salary. We will move Ragusa
from Grade 1 to a Grade 2 salary range, but keep the actual
salary the same with potential for a raise at the next
performance review. Ragusa will now be a Marketing
Services Rep, and make the same salary ($62,900). Having
this new opportunity should be a reward in itself for Ragusa.

Bradshaw, F.
Project Support Assistant

This person is in a very similar situation to Ragusa (above).

However, the performance is still above average but not as
high as Ragusas. Since this person still makes more than
the highest amount for the Project Support Assistant grade,
this person will also be moved to a Marketing Services Rep
position and keep the current salary ($57,800).

Nigh, H.
Quality Assurance Analyst

Nigh has very poor performance, and also makes less than
the required minimum in this grade. Because of this, we feel
as if it makes the most sense to demote Nigh to a job from
Grade 3 to Grade 2. The performance is not high enough to
warrant higher pay. So the pay will stay the same at $83,700
and Nigh will be moved into a Training Assistant position. If
Nigh does not accept this position, Nigh will be let go. Nigh
has been in the job much too long to have such poor
performance.

Since Clinical Liaisons are more of a sales position, we want

to make this position more commission-based. So both of
their bases will be decreased to the lower end of the grade
range, but these sales positions will be able to earn much
more through commission. We also feel as if this will help
encourage top sales. Bases are lowered for both to $70,000.

51

Carson, F.
Senior Quality Assurance
Tech

Carson is being paid way below the minimum at $100,500

and has performance that far exceeds requirements.
Because of this, for now Carsons pay will be increased to
the minimum at $179,898.

Bauman, C.
Training Assistant

Bauman currently makes over the maximum amount for this

range. Bauman has met requirements. Although
performance has not been outstanding, we do not feel it is
fair to decrease the pay because he has met all
requirements. Because of this, Bauman will be moved to a
new job in the next grade but keep current pay at $93,400.
The new job will be Implementation Consultant.

Hiller, G.
Visionary Champion

Hiller has far exceeded the requirements of the job. But

Hiller also is being paid base above the range. Although
Hiller is being paid above the range, we do not think it is fair
to decrease the pay over $2,000 to be in the range because
the performance is so good. The pay will stay the same.

52

FASTCAT ACCESS DATABASE III GRAPHS

53

54