About Shenhuo Group Annual Salary System Practice and Exploration

Abstract: In order to better implement the annual salary system operators, operators on the annual salary system Shenhuo Group scope, composition, management systems, constraints are analyzed, pointing out the existing salary system Shenhuo Group of gaps, present and elaborate an attractive salary standards, combined with long-term incentives, scientific evaluation system for key factors such as the effect of the implementation of the annual salary system role.

Keywords: The Lightning Group, operators, annual salary, incentive pay.

Annual Salary System is an enterprise of the wage distribution system operators, usually on an annual basis in order to determine the quality of business results the operator's annual salary. Manager salary is usually divided into basic salary and benefits salary Basic salary is salary, an annual average wage as the base, according to company size, industry average pay levels and how hard to determine [1]. benefit is a kind of risk-based annual salary, according to business and economic benefits targeted to be completed to determine the circumstances, with some risk, also known as the "risk income." Referred to herein manager salary, mainly referring to Lightning subsidiary managers within the Group's annual salary.

A surefire Group Overview.

Shenhuo Group based on coal, electricity, aluminum production and processing industry chain mainly cross-industry, cross-regional group of large state enterprises, is China Top 500 Enterprises company has total assets of 26.5 billion yuan, under the jurisdiction of the size of sub-branches 14, in which a subsidiary Henan Shenhuo Coal Co., Ltd. "Shenhuo" in August 1999 listed in the Shenzhen Stock Exchange due to numerous Shenhuo Group subsidiaries, operates in the coal, electricity, aluminum, aluminum, machining, construction, real estate, trade, property, and other industries, and fully mobilize the enthusiasm for work the company management level, improve the decision-making group company executive power, to ensure the successful completion of the task management is implemented Shenhuo Group annual salary system operators the main ... ... two operators scope and salary distribution.

Operators include team managers of each unit, including the party chief, deputy according to group performance evaluation results to determine the total annual salary of chief, deputy chief of the total annual salary by 70% of criteria to determine the general manager and party secretary of the annual salary by the Board nature of the work is allocated, in principle than party secretary general. specific amount of salary distribution among deputies, by the general manager made according to the size of the division of labor and responsibility allocation plan to the Board for approval and implementation. managers are implementing the annual salary system, helps assist in team unity, managers allocate quota between work responsibilities based on individual performance and different sizes, but also reflects the responsibilities and rights of the unity, help to improve the operator's work enthusiasm.

3 salary composition.

Shenhuo Group manager salary consists of five components: base salary, annual salary of comprehensive benefits, security, salary, salary and a special contribution to energy saving. Annual base salary by firm size and industry to determine the nature and extent of hard work, on a monthly payment, the overall total remuneration accounted 20% of the overall efficiency of salary based on product sales volume, revenue, profits, project construction, staff salaries, related units coordinate with other indicators of completion, implemented percentile assessment. safety salary based on safety performance indicators and safety agencies set up and management systems, troubleshooting, and other indicators of completion determined remuneration contest is divided into security and safety management assessment salaries, implemented percentile assessment. energy saving salary assessment indicators involving physical consumption per capita efficiency, environmental protection and other indicators, also implemented percentile assessment. except basic salary, other salary based on coal, electricity, aluminum and other industry characteristics and priorities, each company is given a different scale factor, the monthly advance 50%, year-end statistics calculated based on the audit results after Duotuishaobu. special rewards main Is the production and operation of safety over the completion of tasks and enterprise reform, development and stability reward outstanding contributions by the Board of Directors in the general control of 50,000 to 20 million.

Shenhuo Group operators to implement salary cuts management, that the "4 +1" management. According to the different nature of the various subsidiaries work to determine the proportion of each salary, effective solution to the salary system in different industries unity and distinction, highlighting the company's focus has played a guiding purpose subsidiary production operations, while linked with salary of the assessment indicators also vary with different industries would better suit the actual production and operation.

Such as coal company focused on safety management, safety salary largest proportion, aluminum companies, power companies focused on economic efficiency and energy saving, efficiency and energy saving salary relatively large proportion of the annual salary, other companies focus on economic efficiency, comprehensive benefits to salary-based.

4 salary management.

Operator's salary represents the total wages constitute all wages, including various types of wages, bonuses, allowances, subsidies and other wage income, the operators salary strict examination and approval system, must be listed and distributed to the people by the Group Human schedule Resources audit, by the chairman of the company issued after the issuing and included in the company's total wage statistics. Unaudited Group Human Resources Audit, the operator shall not receive any salary in the company income, or income shall be deducted doubling and to hold the company party chief responsibility of the salary paid to the person approving measures to effectively prevent the operator in addition to receiving other wage salary, bonuses, subsidies and other mortgage cash and wage income.

In order to make the operator controllable range of fluctuation in annual salary, except for special contribution to year-end assessment determined by the Board, other criteria determined by the Board annual salary, salary actually paid an annual salary multiplied by the standard score for the assessment proceeds. Such control measures both to prevent beyond the control of the salary range, ups and downs, but also has an effective incentive, incentive operators over the completion of the task, get special rewards award.

Five annual salary system constraints.

(An implementation of safety and operational risk mortgage payments system in order to reflect the responsibilities and rights of unity, the combination of incentives and constraints principle, to prevent business risk, improve operator awareness of responsibility, Shenhuo Group for each subsidiary operators implement an annual safety and operating risk of mortgage payment system. secured amount according to the different nature of the industry and company size differ. deduct significant market factors and other force majeure factors, where the annual profit target to achieve 70% lower than planned or unit product cost is higher than 120% of target or major security incidents, eliminated all of its business risk mortgage payments.

(2 implementation audit system. Currently, audits are conducted Shenhuo Group SAC audit, social design and internal audit Internal audit is divided into quarterly audits, annual audits, special audits and audit managers leaving each end of the quarter, the Audit Department will conduct audits of each unit, and then to conduct a comprehensive audit of year-end, effectively prevent and control the occurrence of violations of enterprise system. annual audit results as the operator of the ultimate basis for performance evaluation, such as found by adjusting the output units, hidden losses, virtual increased costs, delays or early recognition of revenue, false operating results, once verified, seriously investigated unit primarily responsible and handling personnel responsibilities. audit system, especially the implementation of the internal audit system, effectively preventing fraud, concealment and false operating results behavior.

Links to free download http://eng.hi138.com

6 problem.

(A lack of effective long-term incentives. Shenhuo Group manager salary according to the current results of operations for the completion of honor, and the annual salary to take the form of cash, long-term incentive effect is not obvious, resulting in individual units in order to beautify the economic data artificially adjusting accounting data, the enterprise plays an important role in long-term development costs of inadequate investment, such as technological innovation, personnel training, market development and other investment is not enough, is not conducive to long-term development capability. lack of effective long-term incentives may induce managers to improve the short-term economic benefits at the expense of long-term economic benefits and the Group's overall effectiveness.

(2 appraisal system is not scientific and reasonable. Shenhuo Group's operating results for the annual assessment indicators in most indicators, the operator made a favorable long-term development of enterprises can not be given to motivate behavior is not conducive to the operators standing on a more comprehensive and long-term the issue of perspective. performance evaluation system currently has a strong corporate individual characteristics, is not well with the industry from domestic and foreign advanced management experience, assessment content is not comprehensive enough, does not involve the operator's ideology, organization, style, clean government etc., but rather as a separate cadre examination of these indicators, there is no link with managers'salary addition, each evaluation index weight that should be given to difficult scientific approval.

(Three old and new operators there is any equity contradiction Shenhuo Group listed subsidiaries before the listing, the implementation of the Employee Stock Ownership Plan. Ten years later, with the movement of persons and adjustments, many of the existing operators are already retired, the new operators worked, but the original equity holders of the same, so get retired cadres annual dividends dividends far greater than the annual salary of the existing operators, existing operators also exist between how much and whether the differences in equity, if the salary plus dividends paid work as an operator, then, how much a part of the operator's dampened enthusiasm for work.

(4 operators salary and post consumption opaque. Implementation of the annual salary system is very necessary for Shenhuo Group, Shenhuo Group also bring good economic benefits, but in the course of implementation, there is the annual salary and post consumption opaque problem, easily lead to misunderstanding of workers.

Seven recommendations.

(1 Create an attractive salary standards. Annual Salary System can play a stimulating, largely depends on the level of salary standards. Salary standard is necessary to refer to the local manager market average wage level, but also refer to the industry average To ensure higher than the local average, the middle level in the industry, with the average employee salary Scatter to operators generate attractive enough. higher level of benefits and positive spirit inspired the enthusiasm of the operators also affect the important factors should not be ignored.

(2 Establish a combination of short and long term incentive compensation mechanism combined with the current salary situation, recommended the establishment of a combination of long-term incentive compensation, cash compensation to meet the daily consumption needs, operators of long-term incentive compensation decisions for the long-term development [2]. deferred payment can be taken long-term incentive salary, managerial ownership, options, stocks and other means of which the deferred payment of salary, mainly to the part of the operator's annual salary in shares deposited in the form of deferred payment of certain accounts, the agreed period has expired After the stock or cash payments discounted at market prices to the operators.

Managerial ownership is to give senior management invested the right to subscribe nominal shares, after the expiration of the lock grant or transfer of cash, currently part of the leadership Shenhuo Group shares held, but there is no significant correlation with the actual job, it is recommended Original Shares develop certain exit mechanism, on the basis of the legal position as far as possible according to the current re-allocated to ensure that sufficient incentives and constraints role of stock options, is to give operators a certain period of time the right to buy a certain stock, maturity based on the difference between the number of operators can choose to perform or abstain from voting rights. shares of stocks, mainly companies and operators negotiated share purchase price, within a certain time limit in the future by the operator in accordance with the agreed purchase, pay equity costs operators that has the stock rights. Shenhuo Group can combine the current business situation, taking deferred payments, stock options and the implementation of long-term incentives in the form of shares, in order to ensure long-term business maximize the benefits.

(3 operators to establish a scientific and reasonable performance evaluation system. Operators scientific performance appraisal system is to determine the annual salary is reasonable or not a key factor in stimulating and therefore, the performance appraisal system to refer to domestic and foreign advanced experience, not limited to profits, Maintenance and Appreciation assets and other financial indicators [3], is not limited to short-term behavior of the assessment, but also to be used to guide the long-term behavior of the operators, and guide them to achieve strategic objectives from the perspective of thinking and decision-making, can learn from the balanced scorecard approach, balanced scorecard is a strategic and performance management tools, the core idea is that through innovation and learning, financial, customer, internal process 4 level indicators between drive and improve business performance [3], to achieve corporate strategic goals. Balanced Scorecard approach helps to overcome the short-term behavior of the operators, decision-making behavior of long-term strategic services to enterprises, and improving learning and growth and core abilities, to achieve long-term development.

(4 strengthen positions on the operators to control consumption and hidden income. Shenhuo Group manager salary levels in the industry, on the middle level, is the general staff salaries several times or even more in salary incentives to achieve the same time, you must strengthen the position of the operator to control consumption and hidden income [4]. Shenhuo Group vehicles have changed since the beginning of 2002, official cars, housing, communications, etc. to achieve the monetization, according to different criteria into concrete jobs, hospitality and so can not be monetized personal consumption are to develop control limits, avoid excessive consumption of the operators position while business owners and clean government strictly enforce the relevant regulations, reducing operator hidden income in order to strengthen the position of consumption and hidden income control, recommendations to further improve the factory management system, increase the Board, trade unions, workers' congresses on the operator's supervision and restraint.

8 Conclusion.

Establish an attractive remuneration and long-term incentives combined, able to motivate managers to play an active role, however, standards, incentives also need to perform a scientific evaluation system as a basis, in practice, how play better salary system that the role of the distribution system, the need to further summarize and explore.


[1] Gu Meixia. On state-owned enterprise managers salary system [J]. Inner Mongolia Science Technology and Economy, 2009 (2: 100-103.

[2] Wang wise. SOE senior managers incentive constraint Analysis and Countermeasures [J]. Chinese trade, 2008 (18: 20-23.

[3] Liu Ling. SOE Annual Salary System Status · FAQ · countermeasures [J]. Shanxi Coal Management Institute, 2008 (4: 18-22.

[4] Huang Dengli state-owned enterprise managers pay incentive problems and countermeasures [J]. Personnel world, 2009 (25: 9.

Links to free download http://eng.hi138.com

Company Research Papers