Three separate papers-4 pages in total.

Assignment 2 resources

compensation. The graphs in Figure 8.1 on the following page show how different raise systems look as evaluation-to-outcome connections. The graph in the upper left is the evaluation-to-outcome connection for across-the-board raises. If everyone gets the same percentage pay raise, the level of the evaluation has no effect on the size of the raise and the connection is flat. Raises provide no motivation for high performance. They will motivate the person to do only the minimum needed to keep the job.

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Figure 8.1.Evaluation-to-outcome connections: Different pay systems.

The upper right graph shows the connection for raises determined entirely by a bonus or goal-setting system. The only way to get a pay raise is to get to a certain level of performance—a certain level of evaluation. At that level, the raise is the same percentage for everyone who reaches the goal. Those whose performance is higher than the goal get the same raise as those who simply meet the goal. The flat line part of the function shows a zero raise for evaluations from very low (–10) to somewhat positive (+3). Evaluations of +4 or higher trigger a 10% raise. Once the evaluation reaches 4, the line is again flat because performance higher than the goal gets the same raise as performance that just meets the goal. Raises will motivate people to get to the level of evaluation needed to get the bonus, but not to perform any higher than that. The lower left graph shows the connection for a pay system in which raises are determined solely by performance: the level of the evaluation determines the size of the raise. Low levels of evaluation result in no raises or small ones; high levels of evaluation result in large raises. Assuming the other connections are good, such a system will motivate people to try for the highest performance possible. Most pay systems use a combination of these methods to determine raises. For example, an across-the-board increase may be combined with a merit increase: everyone gets a cost-of-living increase, and high performers also get a merit raise. The last graph shows such a pay system. No matter what the evaluation, everyone gets at least a 4% raise. An evaluation above 4 earns a larger raise, and the raise gets larger as the evaluation gets more positive. Raises under this system will motivate people to high performance if they believe they can get the higher evaluations. If they believe it is not possible to achieve the high level of evaluation, the raise will provide no motivation to perform above the minimum needed to keep the job. (Pritchard 91-93)

Pritchard, Robert. Managing Motivation. Routledge, 20080512. VitalBook file.