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o explain system changes Current Challenges 1113 Problems with Job Based Pay Structure ? too rigid, reduces flexibility ? reinforces topdown ? retards changes ? does not reward behavior change ? discourages lateral moves New Approaches 1114 ? Delayering and Banding ? Skill (knowledge) based pay –increases flexibility –firm needs to use available skills Can the . Labor Force Compete? 1115 ? Labor costs are unstable over time ? Quality productivity of labor varies ? Nonlabor cost factors also important in locating facilities –market proximity –response t