According to the text (Martacchio, 2013) discusses internal compensation programs systems that allows companies to structure their pay scales and to determine how they will recruit people to fit the positions they are hiring for. It also states that "HR professionals create internally consistent job structures through two processes- job analysis followed by job evaluation" (p. 120). Some of the challenges companies could face are past inconsistent systems that did not work, inconsistent job analyses, and former job duties that were not aligned with job descriptions, just to name a few. All of these things could present conflicts and issues for the companies as they strive to complete company goals.
I think companies’ market competitiveness is most important for the company’s competitive advantage. If a company is not competitive with the current mart it could face layoffs due to lack of work or it may even have to outsource labor and materials for lower financial challenges it may be faced with. Some pros and cons could be companies with cheaper benefits or even companies that are folding due to loss or lack of business; and of course our economy and its recession. As I see it, all of these are issues and can affect both the internal consistencies and market competitiveness. Currently the organization I am employed by has outsources our benefits, payroll and a few other essential benefits because of our budget and lack of federal funding.
For companies performance management to be effective there should be a evaluation tool in place to properly measure employees performances. As an example, my own company has an evaluation tool in place which has not been very effective in the past and now I as a supervisor have to deal with unhappy employees because of past evaluation ratings. After completing the evaluations under my supervision, I had many employees go over my head to my boss’s supervisor and this caused a great deal of confusion between me, my boss and her boss. I in turn had to redo the evaluations because of the past supervisors inconsistencies and incorrect evaluations. In the past the evaluations were more subjective than objective and this is the reason for all the confusion.

Martocchio, J. (2013). Chapter 1: Strategic Compensation. In Strategic compensation: A human resource management approach (7th ed.). Upper Saddle River, N.J.: Prentice Hall.