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paper_4.rtfAssignment 4: Recognizing Employee Contributions
Name :
Strayer University
HRM 500: Human Resource Management
Prepared for:
December 14, 2013
Incentive Pay
— Incentive pay – forms of pay linked to an employee’s performance as an individual, group member, or organization member
— It is influential because the amount paid is linked to certain predefined behaviors or outcomes
— For incentive pay to motivate employees to contribute to the organization’s success, the pay plans must be well designed
Effective incentive pay plans
— Performance measures should be linked to the organization’s goals
— Employees should believe they can meet performance standards
— The organization should give employees the resources they need to meet their goals.
— Employees should also be in a position to value the rewards given.
— Employees should have the belief the reward system is fair.
Pay for Individual Performance
— Piece work rates
— Piecework rates
— Standard hour plans
— Merit pay
— Individual bonuses
— Sales commissions
Pay for group Performance
Group Bonuses
¡ Bonuses for group performance tend to be for smaller work groups.
¡ These bonuses reward the members of a group for attaining a specific goal, usually measured in terms of physical output.
Team awards
Similar to group bonuses, but are more likely to use a broad range of performance measures:
÷ Cost savings
÷ Successful completion of a project
÷ Meeting deadlines
Balanced Scorecard
— A balanced scorecard is a combination of performance measures directed toward the company’s long- and short-term goals and used as the basis for awarding incentive pay
— three (3)
— measures the HR manager can use to assess shareholder value, customer value, and employee value include
¡ return on capital employed
¡ measure of customer satisfaction is product returns
¡ manager’s objective for employees is learning and growth in the group is to reduce voluntary turnover among employees.
Balanced Scorecard Advantages
— It combines the advantages of different incentive pay plans.
— It helps employees understand the organization’s goals.
— By communicating the balanced scorecard to employees, the organization shows employees information about what its goals are and what it expects employees to accomplish
Incentive motivation
— Incentives can motivate employees in the following ways
¡ Challenge them to work hard
¡ Instill in the belief of they can
¡ Portray that the organization appreciates their efforts
Rewards
— 3 incentives that can be used to motivate employees include:
¡ Cash Bonuses and Gift Cards
¡ Privilege Rewards, and
¡ Points Systems
Cash Bonuses and Gift Cards
— In most cases it is given in the form of money
— Gift cards also provide value which is higher than the benefit f near universality.
— Gift cards makes employees feel special
— Cash bonuses can trigger competition in the organization
Privilege Rewards
— Can take many forms including
¡ Extra long lunches
¡ Commendation
¡ Access to managers lounge
¡ Flexible shift choices
¡ Better parking stall.
Points Systems
— Employees can earn points for a variety of positive behaviors
— The employees save up the points to purchase the prize of their choice.
— It allows the manager to reward your employees for a huge variety of behaviors and goals.
Ethical issues
— Incentive pay for executives lays the groundwork for significant ethical issues.
— When an organization links pay to its stock performance, executives need the courage to be honest about their company’s performance even when dishonesty or clever shading of the truth offers the tempting potential for large earnings.
Ethical issues Continuation
— Dishonest can be one source of ethical issues
— Another ethical issue is unfairness as one group might be allocated more than the other group.
— Poor leadership strategies could be another source of ethical issues
— Values of an organization should be well laid out as any confusion could be problematic
Solution to Ethical Issues
— One of the solutions is to encourage leaders to be sincere in their allocations.
— Everyone is equal and should be allocated what is rightfully theirs
— Leaders should lead by an example
— Other members should support the leaders
Solution to Ethical Issues cont.
— Fairness should form one of the core pillars of the company.
— Clear strategies and guidelines should also be in place, and adhered to.
— Everyone should be ready to adhere to the rules and regulations.
— No one is special from the other
References
Velasquez, M. G. (2012) Business ethics concepts & cases.
Minser A. (2010) Critical Issues in Human Services. Communication Between Organization And Clients. P. 42
Cane, P. (2009) Responsibility in Law and Morality London: Hart Publishing
