Compensation systems focusing on competitors' labor costs typically follow a cost-cutter strategy.

Question

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Compensation systems that focus on competitors' labor costs aim to cut costs and remain competitive by offering similar or slightly lower wages and benefits than those offered by other companies in the same industry. This is a common cost-cutter strategy used to improve profitability and market position.

Compensation Systems Focusing on Competitors' Labor Costs Typically Follow a Cost-Cutter