Pay

6 Pages 1424 Words

The purpose of the pay for performance or financial incentive program is to utilize its human resources to their maximum potential in all areas and in the process to become more competitive, profitable, and team-orientated organization in the market place. The essential goal and value of the pay for performance or financial incentive program is to make all employees entrepreneurs in their areas of expertise within the company.

Pay for Performance is a highly debated compensation. The contra pay for performance view that incentive plans can simply not work. The Pro pay for performance side is the opinion that there are effective incentives that really do motivate. The whole debate arises because of the very fundamental assumption that there is a direct relationship between a company?s productivity and its employees? performance. Many managers believe that incentive pay drives creativity and productivity, and that people are primarily motivated by money, whereas the counter-argument finds evidence that pay for performance plans are not only difficult to design and implement, but can even de-motivate people.

Human Resource Management has become a key strategic issue of attaining competitive advantage, especially as it ties in with motivating employees to excel in their jobs and to give their utmost to take care of their clients? needs.

The plan or strategy of the pay for performance program is to improve the quality, desirability, and profit line of products through the following measures:

? Establish the needs and desires of customers and company stakeholders. Represent these in the departmental or individual performance goal outline.

? Make employees aware of the individual or departmental objectives based on customer desires and how each individual can achieve the overall objectives for mutual success.

? Train all employees on the pay for performance program and objectives so they can take engage and take ownersh...