What is merit guideline in SAP LOD-SF-CMP - Compensation Management?

SAP Term: merit guideline

• Component: LOD-SF-CMP

• Component Name: Compensation Management

• Description: The rules used to determine how to pay an employee based on his or her achievements.

Smart SAP Assistant

• Key Concepts: 
  Merit guideline is a feature of the SAP Compensation Management component that allows organizations to define and manage merit increases for employees. It enables organizations to set up a merit increase budget, define criteria for awarding merit increases, and track the progress of merit increases. 
  
  How to Use It: 
  Organizations can use the merit guideline feature to define the criteria for awarding merit increases, such as performance ratings, job level, and years of service. The feature also allows organizations to set up a budget for merit increases and track the progress of merit increases. 
  
  Tips & Tricks: 
  When setting up a merit guideline, it is important to consider the organization’s overall compensation strategy. Organizations should also consider the impact of merit increases on employee morale and motivation. 
  
  Related Information: 
  The SAP Compensation Management component also includes features such as salary planning, bonus planning, and variable pay planning. These features can be used in conjunction with the merit guideline feature to create a comprehensive compensation strategy.