Analysis of the Effect of Employee Costs on Company Performance
The goal of every economic entity is to accomplish an optimal system of compensation management and to reach maximum returns through optimal employee investment, raising their motivation and knowledge as well as developing their abilities and skills. In order to reach this goal of maximizing compa...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Faculty of Economics and Business in Osijek
2010-07-01
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| Series: | Ekonomski Vjesnik |
| Subjects: | |
| Online Access: | http://hrcak.srce.hr/file/87598 |
| _version_ | 1827363367625424896 |
|---|---|
| author | Željko Požega Boris Crnković |
| author_facet | Željko Požega Boris Crnković |
| author_sort | Željko Požega |
| collection | DOAJ |
| description | The goal of every economic entity is to accomplish an optimal system of compensation management and to
reach maximum returns through optimal employee investment, raising their motivation and knowledge as
well as developing their abilities and skills. In order to reach this goal of maximizing company performance
it is necessary to systematically approach the management of human resources within a certain economic
entity and to create the fairest material and non-material reward and punishment system by using compensation
management methods. This in turn will bring about a positive working atmosphere in the company,
where employees will rapidly and easily adjust to changes, interact and co-operate with one another at a high
level.
This research, which studies the effect of employee costs on company performance, is divided into three
chapters. The first chapter provides a brief theoretical overview of the importance of compensation management
in human resources administration and reaching business efficiency, i.e. the different possibilities
of creating a reward and punishment system in a company which aims to organise an optimal working
atmosphere. The second chapter demonstrates the applied methodology and illustrates the information
from different companies, which has been used in this research and analysis. The information comprises statistical
data of employee costs, income, profits and losses from a sample of companies from the Republic of
Croatia in 2008. The third part deals with the analysis and interpretation of the research results which show
the effect of employee costs on the income and company performance, also expressed per employee.
The goal of this research is to test the hypothesis that companies with higher employee cost, i.e. with higher
investment in human resources, on average obtain a higher income and a higher profit per employee and are
more efficient and more successful on the market. From the given hypothesis, one can derive the hypothesis
that compensation management in human resources administration is of crucial importance for the management
of an economic entity and that strategic planning of investment and expenditure per employee is a
prerequisite for the competitiveness of a business, its development and survival in an increasingly demanding
market race. |
| first_indexed | 2024-03-08T07:48:04Z |
| format | Article |
| id | doaj.art-a4bdd75ffb8b4c148197c316415925eb |
| institution | Directory Open Access Journal |
| issn | 0353-359X 1847-2206 |
| language | English |
| last_indexed | 2024-03-08T07:48:04Z |
| publishDate | 2010-07-01 |
| publisher | Faculty of Economics and Business in Osijek |
| record_format | Article |
| series | Ekonomski Vjesnik |
| spelling | doaj.art-a4bdd75ffb8b4c148197c316415925eb2024-02-02T15:29:13ZengFaculty of Economics and Business in OsijekEkonomski Vjesnik0353-359X1847-22062010-07-01XXIII1Analysis of the Effect of Employee Costs on Company PerformanceŽeljko Požega0Boris Crnković1Faculty of Economics in OsijekFaculty of Economics in OsijekThe goal of every economic entity is to accomplish an optimal system of compensation management and to reach maximum returns through optimal employee investment, raising their motivation and knowledge as well as developing their abilities and skills. In order to reach this goal of maximizing company performance it is necessary to systematically approach the management of human resources within a certain economic entity and to create the fairest material and non-material reward and punishment system by using compensation management methods. This in turn will bring about a positive working atmosphere in the company, where employees will rapidly and easily adjust to changes, interact and co-operate with one another at a high level. This research, which studies the effect of employee costs on company performance, is divided into three chapters. The first chapter provides a brief theoretical overview of the importance of compensation management in human resources administration and reaching business efficiency, i.e. the different possibilities of creating a reward and punishment system in a company which aims to organise an optimal working atmosphere. The second chapter demonstrates the applied methodology and illustrates the information from different companies, which has been used in this research and analysis. The information comprises statistical data of employee costs, income, profits and losses from a sample of companies from the Republic of Croatia in 2008. The third part deals with the analysis and interpretation of the research results which show the effect of employee costs on the income and company performance, also expressed per employee. The goal of this research is to test the hypothesis that companies with higher employee cost, i.e. with higher investment in human resources, on average obtain a higher income and a higher profit per employee and are more efficient and more successful on the market. From the given hypothesis, one can derive the hypothesis that compensation management in human resources administration is of crucial importance for the management of an economic entity and that strategic planning of investment and expenditure per employee is a prerequisite for the competitiveness of a business, its development and survival in an increasingly demanding market race.http://hrcak.srce.hr/file/87598compensation managementhuman resourcesemployee costscompany performance managementrevenue |
| spellingShingle | Željko Požega Boris Crnković Analysis of the Effect of Employee Costs on Company Performance Ekonomski Vjesnik compensation management human resources employee costs company performance management revenue |
| title | Analysis of the Effect of Employee Costs on Company Performance |
| title_full | Analysis of the Effect of Employee Costs on Company Performance |
| title_fullStr | Analysis of the Effect of Employee Costs on Company Performance |
| title_full_unstemmed | Analysis of the Effect of Employee Costs on Company Performance |
| title_short | Analysis of the Effect of Employee Costs on Company Performance |
| title_sort | analysis of the effect of employee costs on company performance |
| topic | compensation management human resources employee costs company performance management revenue |
| url | http://hrcak.srce.hr/file/87598 |
| work_keys_str_mv | AT zeljkopozega analysisoftheeffectofemployeecostsoncompanyperformance AT boriscrnkovic analysisoftheeffectofemployeecostsoncompanyperformance |