Enterprise Human Capital Management Salary Incentive Mechanism

At this time, capital of enterprises includes not only material capital such as funds, factory buildings, equipments, but also human capital such as employee's technique, creativity, and their management ability. How to motivate the human capital of enterprises effectively through assignmg system has become the key fact for their sustainable development. It would encourage the human capital to breathe together with enterprises, make this technical and managerial troops join their corporations to create capability that keep enterprises developing sustainingly.In this paper, firstly, all kinds of modern incentive theories about compensation for human capital are expounded systematically. Then the necessity of establishing compensational incentive mechanism for human capital is analyzed comprehensively from five perspectives. Then six kinds of compensational incentive methods about human capital are compared deeply from all sense by qualitative analysis and quantitative analysis. So their advantage and weakness is analyzed thoroughly. An empirical analysis about the relativity of firm performance and compensation incentive is preceded taking Chinese publicly traded corporations for example. It is proved that firm performance is positively related to the incentive compensation. A conclusion about the best level of incentive compensation for the top management team has been reached. The analysis result shows that at present in profit-sharing enterprises forty to one hundred and sixty thousand Yuan is appropriate to the yearly income of the top management team; In yearly-pay enterprises 10-20 times of average wages is appropriate to the top management team; In ownership-sharing enterprises the more the top management team hold the companies' stock, the better its performance is. Finally, the present situation about compensational incentive of Chinese enterprises has been investigated. Its lack and causes has been analysed. On these grounds I made some rational suggestion for the policy environment. I hope these suggestions can promote enterprises to reform, stir up the potential capability of human capital, and increase enterprise's performance efficiently.