Performance and Compensation

Based on Human Resource Management (4th Edition) by Alan Price - published by Cengage

Performance management is important because it plays a pivotal role in any organization's human resource framework. There are clear benefits from managing individual and team performance to achieve organizational objectives. Similarly, compensation in the form of pay, bonuses, stock options and other benefits can be linked to the achievement of particular goals. But such links do not necessarily produce expected results. This is a problematic and complex area in which common sense solutions do not work.

Issues in this topic area include:

• How have legislative, technological and organizational changes affected the process of performance assessment?
• Why do organizations favour certain stereotypes of good performance?
• What decisions underpin the adoption of performance assessment strategies?
• What are the theoretical and practical problems associated with performance appraisal and counselling.
• How are the HR and payroll functions related?
• How can pay levels be evaluated fairly?
• Does performance-related pay produce the desired results?
• What roles do bonuses, stock options and other forms of non-monetary compensations play in reward management?

• Introduction
• The environmental context
• Business culture
• Legislation
• General economic conditions
• Industry sector
• Technological change
• Flexibility and diversification
• Employee relations
• Workforce composition
• The organization and effective performance
• The 'right' image
• Impression management
• Influencers
• Assessment and organizational change
• Performance strategies
• Motivation and performance
• Achievers and non-achievers
• Locus of control
• Performance management systems
• Management by objectives (MBO)
• Prescriptions for performance management systems
• Reward (compensation) management
• The basis of performance-related pay systems
• Flavour of the (last) month?
• Criticisms of performance-related pay
• The assessment process
• Appraisals and conformity
• The counselling interview
• Objectivity and subjectivity in assessment
• Summary