Red Eléctrica de España uses integer programming for annual salary revisions

Mahou Fernández, Ángel and García Sánchez, Álvaro and Ortega Mier, Miguel Ángel and Moreno Romero, Ana María (2014). Red Eléctrica de España uses integer programming for annual salary revisions. "Interfaces", v. 44 (n. 4); pp. 384-392. ISSN 0092-2102. https://doi.org/10.1287/inte.2014.0753.

Description

Title: Red Eléctrica de España uses integer programming for annual salary revisions
Author/s:
  • Mahou Fernández, Ángel
  • García Sánchez, Álvaro
  • Ortega Mier, Miguel Ángel
  • Moreno Romero, Ana María
Item Type: Article
Título de Revista/Publicación: Interfaces
Date: 2014
ISSN: 0092-2102
Volume: 44
Subjects:
Freetext Keywords: mixed-integer linear programming; optimization; salaries; compensation policy; human resources.
Faculty: E.T.S.I. Industriales (UPM)
Department: Ingeniería de Organización, Administración de Empresas y Estadística
UPM's Research Group: Research Group in Industrial Engineering and Logistics, Research Group in Sustainable Organizations
Creative Commons Licenses: Recognition - No derivative works - Non commercial

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Abstract

In this paper, we present a mixed-integer linear programming model for determining salary-revision matrices for an organization based on that organization?s general strategies. The solution obtained from this model consists of salary increases for each employee; these increases consider the employee?s professional performance, salary level relative to peers within the organization, and professional group. In addition to budget constraints, we modeled other elements typical of compensation systems, such as equity and justice. Red Eléctrica de España (REE), the transmission agent and operator of the Spanish electricity system, used the model to revise its 2010 and 2011 salary policies, and achieved results that were aligned with the company strategy. REE incorporated the model into the salary management module within its information system, and plans to continue to use the model in revisions of the module.

More information

Item ID: 37823
DC Identifier: http://oa.upm.es/37823/
OAI Identifier: oai:oa.upm.es:37823
DOI: 10.1287/inte.2014.0753
Official URL: http://pubsonline.informs.org/journal/inte
Deposited by: Memoria Investigacion
Deposited on: 08 Oct 2015 14:37
Last Modified: 27 Feb 2017 16:55
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