Compensation and Benefit Systems Implemented at a Major United States Company Research Proposal

Excerpt from Research Proposal :

Fun is Good

The Benefits of Google Inc.

The benefits and compensation system for Google Inc. is both varied and complex. It offers many options for the worker at Google Inc. And is meant to increase employee retention rates within the company. Compensation and benefits systems enable leaders to generate and maintain a chance for an effective mechanism that stimulates a culture of self-empowerment, creative modernization, and self-motivating employees. Google is among the top companies in promoting self-motivation and innovation within its employee pool leading to its continual success and high profits.

Google Inc. has become one of the top 100 companies in the world with profits increasing since its formation in 1998 and its first public offering in 2004. Ever since the mid-2000's, Google has received a steady wave of success. "Companies like Cisco Inc. And Google Inc. have structured their leadership to provide the best environment to motivate their employees with intrinsic and extrinsic rewards." (Cook 1) With the success however, comes the misses. Amidst high employee satisfaction comes high employee turnover. Although the company values its employees and tries to create a healthy work environment, some articles say Google Inc. has a high employee turnover rate due to competitive offers from rival companies and startups. That still doesn't ruin their reputation as one of the nation's top-producing companies. "They have become top-producing companies that develop some of the best products that have shaped our world, have taught us how to find information, and have taught us how to learn and see things differently." (Cook 1) Thanks to their compensation and benefits package for its employees, Google Inc. became one of the top companies to work for and when polled, Google Inc. employees expressed a high satisfaction rating.

The 84% satisfaction rating comes from: "Free gourmet food all day, the best health insurance plan anywhere, five months' paid maternity leave, kindergartens and gyms at the workplace, the freedom to work on one's own projects 20% of the time, even death benefits." (Bershidsky 1) Employees literally have better benefits at Google than they would if they paid for it themselves. That is why people are dumbfounded when reviewing the information pertaining to the high turnover rate within the company's employee pool. Bershidsky suggests it comes from the mentality of the youth hired from the generation Y group. "No matter how satisfied these highly marketable young minds may be, no matter how much they enjoy the free meals and hybrid car subsidies, they will jump ship as soon as they get bored or get a better offer elsewhere." (Bershidsky 1)

Regardless of employee turnover rates, an organization or company like Google Inc. must make the maximum profit long-term through attracting the best talent out there and retaining them even it is short-term. Google has had continued success in maintaining steady or even increasing profits and through their rigorous entry testing, ensure they are getting top talent to work for them. When they gain the top talent, the company does everything it can to motivate them. The company's now famous rewards has made them the best place to work for since 2009. "Google, Inc. was ranked by Fortune magazine as the best place in the U.S. To work in 2009, and it has reached another zenith by becoming the most popular Web site." (Cook 1)

The company makes most of its profits through delivery of online advertisements. Its primary revenue bases are Google Adwords and Adsense. They have company offices and locations throughout the world and deals a brand portfolio of web-based merchandises and services, which are categorized into six categories: "Google.com, applications, client, Google GEO, Google Mobile and Android, Google Checkout, and Google labs." (Cook 1) With six categories and a growing number of people utilizing the various areas Google markets or services, it's no wonder the company is doing everything it can to gain competent employees who will be inspired and motivated enough to continue the success the company has worked hard to gain.

"The company recorded revenues of $50,175 million during the fiscal year ended December 2012 (FY2012), an increase of 32.4% over FY2011." (Datamonitor 1) Google, Inc.'s corporate culture reflects the mindset and desires of the company's founders Sergey Brin and Larry Page. Brin and Page did not want their company to feed into the traditional 1980's mantra of "greed is good." For them drama in the workplace was unacceptable. They wanted a comfortable and positive work environment for their employees. The mecca they formed, called the Googleplex, became a place where the most talented employees congregated and brainstormed on concepts that were and are innovative and trend-setting. Google Inc. formed an incubator where philosophies had and have room to grow and evolve into profitable and popular successes. The founders held firm to the belief that the best talent out there will be attracted to the best rewards and will feel motivated to try their best in any area of work they have in the company as long as they are treated well and work in a positive environment.

One of the biggest rewards Google offers its employees is flexibility. They offer employees the chance follow concepts that test the status quo and destroy archetypes. Instead of the late "greed is good" mantra, Google, Inc.'s CEO, Erin Schmitt, uses "fun is good" as the company's main principle and states that the challenge of work should be in itself a fun activity. Putting their employees first through providing an exceptional work environment leads to higher overall productivity. The CEO of Google Inc. states: "We realize and celebrate the variety of needs our employees have, and that this diversity demands flexibility and individually directed support. Our main priority is to offer a unique and customizable program that can be tailored to the particular needs of every individual." (Google 1)

"Google, Inc. provides a standard package of fringe benefits, but on top of that are first-class dining facilities, gyms, laundry rooms, massage rooms, haircuts, carwashes, dry cleaning, commuting buses -- just about anything a hardworking employee might want." (Cook 2) Google understands the needs of the workers to perform their job responsibilities and their everyday routines. That's why Google relies on providing both intrinsic and extrinsic rewards to help workers feel like they can work and successfully fulfill their personal and daily goals. Google knows motivation is not solely seen in pay incentives, but also in how the company shows it cares for its employees. They understand decent company culture is correlated to company success that is why Google sought the opinion and expertise of a Culture Czar.

"Google, Inc.'s CCO, Chief Culture Czar, Stacy Sullivan, is devoted to one thing -- make Googlers happy. One way of maintaining Google, Inc.'s culture and keeping employees happy is administering the best perks and rewards." (Mills 1). Google Inc. has traditional extrinsic benefits such as free medical and dental benefits, a varied offering of 401k plans, flex spending accounts, insurance, vacation packages, even but they also have other benefits. These benefits are unique to Google Inc. And fall under a modern category of extrinsic. They include: maternity benefits up to six and a half months off at around 100% pay. "In addition, new mothers and fathers get Take-Out Benefits to help make things easier. They are provided with expenses up to $500 for take-out meals during the first three months that they are home with their new baby." (Cook 2) In the Gift Matching Program, another form of benefits for employees, Google provides back-up child care equaling donations of up to $3,000 per year from eligible employees to non-profit organizations.

Google Inc. even offers help with extremely personal matter such Adoption Assistance. The company offers financial aid to the employees wishing to adopt a child. Including other legal matters, Google, will compensate employees up to $5,000 to use towards legal expenditures. The complimentary gourmet food mentioned earlier comes in the form of a free lunch and dinner that is prepared by gourmet chefs. The chefs generate a wide assortment of healthy and wonderful meals on a daily basis. Aside from the daily meals, Google also offers snack. Google's headquarters even have an on-site doctor and in certain locations, provides free shuttle transportation.

"At Google headquarters in Mountain View, there is on-site oil change, car wash, dry cleaning, massage therapy, gym, hair stylist, fitness classes and bike repair." (Cook 2) Google wants its employees to be health conscious and environmentally conscious. That is why the company will reimburse its employees up to $5,000 for the purchase of a hybrid car. Along with all these benefits, too many to list, and new ones being included on an annual basis, employees are also allowed the freedom they don't typically get in other jobs. That is where the intrinsic rewards come in.

The intrinsic rewards Google offers are: small work groups, no real hierarchy, and most importantly, purpose. Their hierarchical structure is flat to get the best out of an employee's creativity. Focus on…

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