A pay for performance system is a system that records the remuneration for workers of a given be organization. The remuneration purposely reward and compensate rather than the job done. It is an effective tool for keeping employees motivated. It also serves the purpose of making employees proactive. This is to get out of way to perform tasks that are not in their job description list.
Several theories have been proposed to explain and predict the jobs and their motivating factors. These theories explain how employ complete their jobs successfully. Job A requires communication and customer service as compared to knowledge and physical capability. This job is explained by Maslow’s basic need theory of motivation. The theory argues that employees are motivated by unmet need. Once need has been met it no longer become a motivating factor The base pay of employees will have to be set high. This will provide financial empowerment that employees will use to meet their basic needs. They will be motivated to communicate with confidence and empathy. Motivation also leads to high quality services. Because the physical capability is limited, employees will need some insurance in case they engage in physical roles and get injured. The Maslow’s theory provides some form of insurance for injuries sustained in the course of offering service to a company or business. Communication is vital in the organization, because individuals will share success and motivate each other using their advanced communication skills and capabilities.
The expectancy theory also provides guideline in respect to motivating employees in job A. The theory argues that individuals are motivated with what they will gain in engaging in an activity. It focuses on three important factors, valence, instrumentality and expectancy. Expectancy provides an assessment of the employees’ ability to do required tasks efficiently. The job is clear with requirements of it employees. The ability to communicate and customer service delivery are the most essential qualities of employees. The theory motivates potential employees to cultivate the desired qualities and meet the set objectives. People are also encouraged to choose the best customer service techniques and communication channels to get the greatest rewards from their management (Greaver, 2009). This job requires communication skills, knowledge, physical capability and customer service. The physical part can take a toll on the energy of an employee. They need higher motivation and remuneration to take care of themselves. The pay systems should also be flexible and change as change demands in the market. Employers should also use their skills to learn the rewards that best suit the personal needs of their employees. The desired behaviors of the employees by their employers should come in exchange for something that the employers would enjoy.
Another emerging trend in business is increased willingness of employers to give variable pay. The job A needs willing employees. Employees should not only be motivated by remuneration but they should enjoy what they are doing. The dynamic business market had witnessed competition from foreign companies due to improved geographical mobility of production factors. The job therefore is being done by many other businesses in the market. Employees need to embrace it and perform their task efficiently. Technology has made labor, capital and entrepreneurship mobile. In response companies are committed to keep employees lest they are given better contracts by competitors. The cost of training qualified and competent employees is also high. Businesses prefer to train, manage and maintain their own. They also train their own to occupy top managerial positions in future. This is advantageous as it builds employees understanding to the culture and philosophy of the company better then new comers.
Pay for performance plans are of different types. They could be merit pay, individual spot awards, lump sum bonuses, and individual incentive plans. The merit pay is given for what employees have done for a given payment period, a month or a week depending on the organization. Job A should adopt lump sum approach to keep employees enjoying the output of their hard work. Employees that are highly rated should obviously give more than those below them in rank. Managers earn more than subordinates. It could be expensive when the input is compared to the output. More resources are channeled towards payment than those that the company gets from the efforts of the employees. The job could be improved if the performance of each person is accurately measured. Enough resources should also be channeled towards rewarding hard work. The amount issued should also be different across different performance levels (Duening & Click, 2005)
Job B requires employees to be well versed in customer service, communication and team work. Educational and work experience are required but on a minimal scale as compared to other values. The job would require the employees to be motivated using the goal setting theory. This theory argues that the management set complex and challenging goals to the employees and they are motivated if they achieve them. The management will have to set challenging goals in terms of performance. The goals will be set and assigned to different teams. The teams with the highest scores are rewarded. Individual in the best performing teams are also recognized and rewarded. The set goals will serve as important feedback standards that employees can use to compare their performance in future. Team work requires leadership and proper communication channels. The job would require setting goals to enable the organization to eliminate a tendency of group mentality. Group mentality is predominant in teams where some people move along with the crowd because individual contribution is not monitored. The rewards offered for the job should also match the difficulty of the goals set and accomplished. This kind of job reinforcement of characters for them to be employed I future by the employees.
The reinforcement theory could be used to reward sustained and motivated performance and characteristics by team members a behavior is reinforced through reward and eliminated by punishment. Better customer service techniques that have been used overtime should be encouraged. The encouragement is provided by rewarding those that have continually carried on with the desired techniques and characters. The rewards should come directly after the team has done a good job in an expected manner. This will also serve the purpose of discouraging unwanted practices. It is so because unwanted practices will not be rewarded and will therefore be discontinued. The timing of rewards is very vital as far as the theory is concerned. The rewards should be effectively timed, immediately after completion of a task.
The pay for performance system has come about to address a growing trend of the behavior of employees. Employees in the job market tend to exhibit similar characteristics. They all need to be compensated for roles performed outside their job description. Job B requires that employees be better at offering services to customers, communicate effectively and work as a team. The theory will work effectively in motivating employees to express themselves and fulfill their other needs in the hierarchy. The reinforcement theory will require that employees be rewarded for wok well done besides the obvious accomplishment of goals and meeting deadlines. The reward and compensation serves to reinforce the behaviors that employers desire form employees. Employees will exhibit good characters and the proper attitude towards their job if well compensated. With the theory in place, Compensation should also be a sufficient initiative to hire and recruit good qualified and competent employees. Getting experienced and motivated employees has become a catch for most businesses. The qualified ones are tied down by long contracts and attractive bonuses. This is to ensure the best and well cultured employees remain with their mother companies and businesses. The employees are made to undergo further training and team building. Such employees who have had so much from respective companies and businesses are morally obliged to be remaining with their companies as a way of giving back.
Greaver, M. F. (2009). Strategic approach to a structured approach to rewarding good performance initiative. New York: AMACOM.
Duening, T. N., & Click, R. L. (2005). Essentials of employee motivation and staff retention Hoboken, N.J.: John Wiley & Sons.