Explain various approaches in designing compensation. Chalk out various alternative system of compensation.

Compensation refers to the total amount of financial and non-financial rewards given to employees in exchange for their work. It is a critical aspect of human resource management as it helps to attract, retain and motivate employees. There are several approaches to designing compensation, each with its advantages and disadvantages. Here are some of the most popular approaches:

1. Job-based compensation – This approach is based on the job's value or worth to the organization. The job's value is determined through job analysis, which involves identifying the job's tasks, responsibilities, and required skills and knowledge. The compensation is then set based on the job's value, with higher-paying jobs requiring more skills and experience. Job-based compensation can be advantageous as it provides a clear and objective measure of worth, but it may not account for individual performance differences.

2. Skill-based compensation – This approach compensates employees based on the skills they possess. ________ _____ _____ ________ __________ ______ __________ ______ ______.
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