This document discusses managing human capital through merit pay plans. It begins with an executive summary that outlines the purpose of examining factors influencing merit pay plans and debates arguments for and against them. It then provides sections on reward structures, performance appraisal, compensation/benefits, legal considerations, examples of merit pay plans in practice, and guidelines for establishing successful merit pay plans. While merit pay can positively motivate performance, the document notes it is difficult to objectively measure and evaluate merit, and performance evaluations may differ between management and employees. Overall guidelines and considerations are provided, but it concludes there is insufficient evidence to determine if merit pay definitively enhances performance.
managing human capital(MHC) mba 2 semesterSuzan Maharzan
This document discusses managing human capital and outlines several key points:
1. It defines human capital as the collective skills, knowledge, and expertise of employees that contributes to organizational productivity. Managing human capital involves treating employees as assets and investing in them.
2. Some challenges to managing human capital include globalization, workforce diversity, technological advances, and changing political/legal environments. HR strategies like task force, development, turnover, and paternalistic strategies can help address these challenges.
3. Best practices for managing human capital involve recruitment/selection, training, performance management, reward systems, and career development. The document discusses these practices and compares best practice and best fit approaches to human resource management.
Assess the purpose of strategic human resource management activities in an organisation & evaluate the contribution of strategic human resource management to the achievement of an organization’s objectives
Be able to develop human resource plans for an organisation
Critically evaluate how a human resources plan can contribute to meeting an organization's objectives
Understand human resources policy requirements in an organisation
Explain the purpose of human resource management policies in organisations
Sample Assignment on Human Resource ManagementAdam Jackson
Are you facing assignment related problems? Don't worry read the samples provided by Assignment Prime which helps the students to improve their grades. For online assignment help you can contact our professional writers at any time. Place your order now to achieve academic success.
Importance of Human Resource Management in 21st Century12inch
Human beings are the most important resource of an organization. These are the people who plan all the activities and then they carry on all the activities. And managing human beings is the toughest duty of the manager as no two persons are alike. Every individual has separate values, aspirations, motivations, assumptions, goals, etc. Today we are discuses about Importance of human resource management in 21st century
As the modern businesses faces pressure of competition and globalization, the roles and responsibilities of Human Resources managers has transformed completely (Storey, 1999). The long-term demand of the HR manager has increased significantly, however the global supply of talent is becoming very short. In this competitive market place for labor and product, the major challenge or gap is the problem of manpower everywhere (Deb, 2006). Now each and every organization, in order to succeed in the market is in great need to place more emphasis on human resource managers (The strategic importance of human resource development, 2004). This is because of the fact that they are playing a strategic role in this contemporary business world. In this changing global labor market conditions, HR managers along with the firms should be able to adapt their human resource practices accordingly. Here, in this research report the strategic role of Human Resource Manager for the success of the organization is being reflected by taking a case Hotel Holly House (Kapur, n.d).
This document provides an overview of strategic human resource management for two large retail organizations, Tesco and Walmart. It discusses the importance of SHRM and how it contributes to organizational objectives. The document also outlines how to develop an HR plan, including identifying business factors, requirements, and developing a five-step process. Finally, it discusses the purpose of HR policies and how they help meet regulatory requirements and organizational culture.
The document is a cover sheet and table of contents for a 14 page assignment on developing a strategic human resources plan for Jameson Irish Whiskey to enter the Chinese market over the next two years. It provides background on Jameson as the top selling Irish whiskey in the world and outlines that China is a rapidly growing market for alcohol. The strategic HR plan will address strategic resourcing, reward management, performance management, and learning and development to recruit and retain qualified employees in China, where there is a lack of talent meeting foreign companies' needs. The best fit HRM model will be applied to the Chinese market context.
This document discusses human resource management (HRM), including its scope, functions, and the process of HR planning. It defines HRM as managing people within an organization to maximize productivity. The scope of HRM includes personnel management, employee welfare, and industrial relations. Key functions are staffing, compensation/benefits, and defining work. HR planning involves forecasting needs, auditing current resources, and developing action plans. Common forecasting techniques discussed are trend analysis, expert forecasts, scenarios, and regression analysis.
managing human capital(MHC) mba 2 semesterSuzan Maharzan
This document discusses managing human capital and outlines several key points:
1. It defines human capital as the collective skills, knowledge, and expertise of employees that contributes to organizational productivity. Managing human capital involves treating employees as assets and investing in them.
2. Some challenges to managing human capital include globalization, workforce diversity, technological advances, and changing political/legal environments. HR strategies like task force, development, turnover, and paternalistic strategies can help address these challenges.
3. Best practices for managing human capital involve recruitment/selection, training, performance management, reward systems, and career development. The document discusses these practices and compares best practice and best fit approaches to human resource management.
Assess the purpose of strategic human resource management activities in an organisation & evaluate the contribution of strategic human resource management to the achievement of an organization’s objectives
Be able to develop human resource plans for an organisation
Critically evaluate how a human resources plan can contribute to meeting an organization's objectives
Understand human resources policy requirements in an organisation
Explain the purpose of human resource management policies in organisations
Sample Assignment on Human Resource ManagementAdam Jackson
Are you facing assignment related problems? Don't worry read the samples provided by Assignment Prime which helps the students to improve their grades. For online assignment help you can contact our professional writers at any time. Place your order now to achieve academic success.
Importance of Human Resource Management in 21st Century12inch
Human beings are the most important resource of an organization. These are the people who plan all the activities and then they carry on all the activities. And managing human beings is the toughest duty of the manager as no two persons are alike. Every individual has separate values, aspirations, motivations, assumptions, goals, etc. Today we are discuses about Importance of human resource management in 21st century
As the modern businesses faces pressure of competition and globalization, the roles and responsibilities of Human Resources managers has transformed completely (Storey, 1999). The long-term demand of the HR manager has increased significantly, however the global supply of talent is becoming very short. In this competitive market place for labor and product, the major challenge or gap is the problem of manpower everywhere (Deb, 2006). Now each and every organization, in order to succeed in the market is in great need to place more emphasis on human resource managers (The strategic importance of human resource development, 2004). This is because of the fact that they are playing a strategic role in this contemporary business world. In this changing global labor market conditions, HR managers along with the firms should be able to adapt their human resource practices accordingly. Here, in this research report the strategic role of Human Resource Manager for the success of the organization is being reflected by taking a case Hotel Holly House (Kapur, n.d).
This document provides an overview of strategic human resource management for two large retail organizations, Tesco and Walmart. It discusses the importance of SHRM and how it contributes to organizational objectives. The document also outlines how to develop an HR plan, including identifying business factors, requirements, and developing a five-step process. Finally, it discusses the purpose of HR policies and how they help meet regulatory requirements and organizational culture.
The document is a cover sheet and table of contents for a 14 page assignment on developing a strategic human resources plan for Jameson Irish Whiskey to enter the Chinese market over the next two years. It provides background on Jameson as the top selling Irish whiskey in the world and outlines that China is a rapidly growing market for alcohol. The strategic HR plan will address strategic resourcing, reward management, performance management, and learning and development to recruit and retain qualified employees in China, where there is a lack of talent meeting foreign companies' needs. The best fit HRM model will be applied to the Chinese market context.
This document discusses human resource management (HRM), including its scope, functions, and the process of HR planning. It defines HRM as managing people within an organization to maximize productivity. The scope of HRM includes personnel management, employee welfare, and industrial relations. Key functions are staffing, compensation/benefits, and defining work. HR planning involves forecasting needs, auditing current resources, and developing action plans. Common forecasting techniques discussed are trend analysis, expert forecasts, scenarios, and regression analysis.
Wallace is concerned with career security rather than job security. Career security focuses on continually acquiring new skills over the long term to remain valuable and employable, rather than relying on a single job or employer. Wallace points out to his coworkers that improving skills through training is important for career development and will prevent workers from becoming obsolete as technologies change. While skills may become outdated, a continual commitment to learning helps secure one's career.
This document discusses the recruitment and selection process of sales personnel at Hemas, a Sri Lankan healthcare product distributor. It outlines Hemas' objectives in recruitment which include acquiring and retaining the best talent. The selection process is described in 7 stages from pre-interview screening to induction. Key factors like sources of recruitment, criteria for medical representatives, and a survey of factors affecting recruitment policy are also summarized. The conclusion emphasizes that selecting the right person for the right job is important for pharmaceutical companies to face market challenges.
This document provides an overview of key topics in human resources management including definitions, recruitment and selection, interviews, training, performance evaluation, occupational health and safety, and pension schemes. It begins with an introduction to human resources management and its evolution from scientific management to modern behavioral approaches. The roles and duties of human resources personnel are discussed. Common terms are defined and the processes of recruitment, selection, and interviews are described. Methods of training, performance evaluation, job evaluation, and ensuring occupational health and safety are also outlined.
The document outlines a proposed human resources strategy for a company. It discusses developing goals and policies to improve employee performance, training, recruitment, motivation and evaluation. The strategy aims to support business objectives by raising efficiency standards, developing employee skills and increasing revenue through an integrated HR plan.
Educaterer India is an unique combination of passion driven into a hobby which makes an awesome profession. We carve the lives of enthusiastic candidates to a perfect professional who can impress upon the mindsets of the industry, while following the established traditions, can dare to set new standards to follow. We don't want you to be the part of the crowd, rather we like to make you the reason of the crowd.
Today's Effort For A Better Tomorrow
The document discusses challenges in managing expatriates for multinational corporations. It notes that MNCs often experience premature return of expatriates due to failed assignments and loss of returned expatriates due to poor repatriation. This can threaten organizational performance. To reduce costs, MNCs aim to improve expatriate management before, during, and after international assignments. The document also outlines an assignment asking students to analyze and address issues relating to expatriate management.
We Also Provide SYNOPSIS AND PROJECT.
Contact www.kimsharma.co.in for best and lowest cost solution or
Email: amitymbaassignment@gmail.com
Call / What’s App: 9971223030
SHRM AND Greenfield Operations
HR personal or department DHS Motors Limited Companynowshin naina
This presentation provides an overview of DHS Motors Limited Company in Bangladesh. It discusses DHS Motors' history of being the first distributor of Honda vehicles in Bangladesh since 1994. The presentation outlines DHS Motors' mission, vision, and objectives of providing high-quality, affordable products to satisfy worldwide customers. It also describes the company's hierarchy, findings from an employee survey, a SWOT analysis, and recommendations to develop new products and technologies to satisfy customers during economic challenges. The conclusion restates the company's goal of pursuing mobility and extending joy to more customers.
Human resource management involves four key activities: staffing, training, motivation, and maintenance. It aims to recruit qualified employees, develop their skills, motivate them, and ensure workplace health and safety. HRM functions include acquisition, development, motivation, and maintenance of employees. It is influenced by internal corporate strategies and external factors like government regulations, technology changes, and economic conditions. Strategic HRM links human resource goals to organizational strategies through job analysis, planning, recruitment, selection, and development of employees.
Innovative Human Resource Practices in Indian Banks: A Study from HR Manager’...Dr. Amarjeet Singh
Banking sector is one of the vital financial pillars of
Indian economy is one of the indispensable money related
mainstays of Indian economy. The progression approach has
influenced the intensity of banks because of the worldwide
weights coming about into mix of Human Resource The
board with business approaches. The review by Boston
Consulting Group (BCG) and Indian Bank's Affiliation
(IBA) report that the Indian keeping money industry will
confront two up and coming difficulties that is an monetarily
feasible answer for monetary consideration and HR structure
in next multi decade. While the main test requests bizarre
advancement and experimentation, the second undermines to
injure the capacity of the biggest fragment of the saving
money industry from having the capacity to advance and
remain aggressive. The special complexities of people in
general division make traditional HR arrangements
ineffectual. The activities like "Pradhan Mantri Jan-Dhan
Yojana" by the Honorable Prime Minister of India, banks
commitment in the budgetary incorporation has helped up,
however the representative's desires from the business have
additionally emerged. This requires a need to advance the
prior HR practices of the banks with the goal that the
representative profitability can be improved. This paper
intends to give an understanding to such advancements,
identified with Human Resource Management with the
assistance of a essential investigation dependent on the
perspectives of HR chiefs of six diverse Indian banks both
from open and private segment. These creative HRM
rehearses have been recorded under seven distinct heads of
HRM to be specific enlistment and determination, preparing
and advancement, execution the executives, pay the
executives, profession improvement, worker inspiration and
representative security. A couple of the prior examinations
have likewise been eluded for the last ends. The dimension of
usage of these advancements may not be tasteful, yet the
usage has been begun and the positive outcomes in the
profitability will make these banks feel how essential these
are for their development. It has been discovered that
intermingling of practices of new and imaginative HR regions
will profit the banks to wind up progressively aggressive.
This document discusses the importance of human resources in modern business and the role of HR. It explains that HR ensures a productive work environment by implementing strategies and practices to effectively manage employees. These include recruitment, training, performance management, and creating policies. The document also outlines the importance of companies being equal opportunity employers. It states that providing equal opportunity and a discrimination-free workplace increases employee motivation, satisfaction, and loyalty, which benefits the organization.
The document discusses various challenges faced by human resource managers and suggestions to overcome them. It defines HRM and lists key functions of HR managers. Some major challenges discussed are attrition, recruitment and training costs due to attrition, retention of employees, effective communication, and competitive challenges due to globalization and new technologies. Suggestions provided include adopting new trends, improving job satisfaction, reducing work pressure, effective training, and embracing new technologies. Examples given are of smoking bans in Japanese companies and challenges faced by an Indian cigarette company.
Importance of integrating Human Resource Management into a business’s strateg...Swapnil Mali
This document discusses the importance of integrating human resource management (HRM) into a business's strategic planning process. It provides examples of how companies like Google and Anglo American have developed innovative HR strategies that helped them attract and retain talent, driving competitive advantage. The document argues that for organizations to meet strategic goals, HR must be involved in planning to ensure human capital needs are addressed and employees are properly motivated. Involving HR enables setting realistic targets and managing performance, while theories discussed emphasize the human aspects of management beyond financial incentives.
Exploring human resource management practices in small and medium sized enter...IAEME Publication
This document summarizes a research paper that explores human resource management (HRM) practices in small and medium enterprises (SMEs) in Bangalore and Mysore, India. The paper reviews literature on HRM practices in SMEs and finds recruitment is informal through personal networks and training is limited. A pilot study tested a questionnaire on HRM practices including recruitment, training, compensation, performance appraisal and welfare measures. The study found the questionnaire to have acceptable internal consistency above 0.7.
First, the number of employees that companies have abroad has increased, creating new global challenges for HR departments. These include candidate identification and selection for global assignments, cost projections for sending employees overseas, creating assignment letters, developing compensation and benefits programs for different countries, providing relocation assistance, and offering family support. Going forward, key HR practices will include increased workplace flexibility, a more global workforce, emphasis on work-life balance, ongoing workforce development, broader job definitions, and a more strategic role for HR. Overall, HR is undergoing a revolutionary transformation and has become more important than ever to business success due to intensifying global competition.
Difference between human resource management and personnel managementsai precious
1. Human resource management focuses on managing people as a valuable resource to achieve organizational goals, while personnel management takes a more administrative approach centered around individual employee needs.
2. Key differences include HRM emphasizing a unified relationship between management and employees, decentralized decision-making, and transformational leadership versus the transactional style of personnel management.
3. HRM also utilizes more flexible employment contracts, job designs centered around teamwork, and pay/incentive policies linked to performance and value-added contributions compared to the traditional functional approach of personnel management.
The document discusses new trends in human resource management (HRM). It covers a variety of topics influencing HRM, including technological changes, economic and political challenges, an aging workforce, skill deficiencies, and changes in the employment relationship. HR must deal with issues like globalization, outsourcing, mergers and acquisitions, and reengineering. The role of HR is shifting from administrative to more strategic. HR needs to anticipate challenges and support organizational strategy.
This document discusses two key issues in human resource management: outsourcing HR activities and business process outsourcing (BPO) and call centers. It provides examples of large companies that outsource HR functions such as payroll and benefits administration. It also discusses the challenges faced by HR managers in retaining employees in BPOs and call centers due to high attrition rates, health issues caused by night shifts and repetitive work, and lack of career growth opportunities. HR managers need innovative strategies to improve employee engagement and prevent burnout in these roles.
This document discusses managing human capital through merit pay plans. It provides background on performance appraisal and compensation programs before examining arguments for and against merit pay. The document outlines examples of merit pay plans in practice and their successes and failures. Guidelines are presented for establishing successful merit pay plans, recognizing that individual and organizational factors must be considered. While merit pay can motivate performance, proper implementation and performance evaluation are necessary.
This document discusses managing human capital through merit pay plans. It provides background on performance appraisal and compensation programs before examining arguments for and against merit pay. The document outlines examples of merit pay plans in practice and their successes and failures. Guidelines are presented for establishing successful merit pay plans, recognizing that individual and organizational factors must be considered. While merit pay can motivate performance, proper implementation and performance evaluation are necessary.
Wallace is concerned with career security rather than job security. Career security focuses on continually acquiring new skills over the long term to remain valuable and employable, rather than relying on a single job or employer. Wallace points out to his coworkers that improving skills through training is important for career development and will prevent workers from becoming obsolete as technologies change. While skills may become outdated, a continual commitment to learning helps secure one's career.
This document discusses the recruitment and selection process of sales personnel at Hemas, a Sri Lankan healthcare product distributor. It outlines Hemas' objectives in recruitment which include acquiring and retaining the best talent. The selection process is described in 7 stages from pre-interview screening to induction. Key factors like sources of recruitment, criteria for medical representatives, and a survey of factors affecting recruitment policy are also summarized. The conclusion emphasizes that selecting the right person for the right job is important for pharmaceutical companies to face market challenges.
This document provides an overview of key topics in human resources management including definitions, recruitment and selection, interviews, training, performance evaluation, occupational health and safety, and pension schemes. It begins with an introduction to human resources management and its evolution from scientific management to modern behavioral approaches. The roles and duties of human resources personnel are discussed. Common terms are defined and the processes of recruitment, selection, and interviews are described. Methods of training, performance evaluation, job evaluation, and ensuring occupational health and safety are also outlined.
The document outlines a proposed human resources strategy for a company. It discusses developing goals and policies to improve employee performance, training, recruitment, motivation and evaluation. The strategy aims to support business objectives by raising efficiency standards, developing employee skills and increasing revenue through an integrated HR plan.
Educaterer India is an unique combination of passion driven into a hobby which makes an awesome profession. We carve the lives of enthusiastic candidates to a perfect professional who can impress upon the mindsets of the industry, while following the established traditions, can dare to set new standards to follow. We don't want you to be the part of the crowd, rather we like to make you the reason of the crowd.
Today's Effort For A Better Tomorrow
The document discusses challenges in managing expatriates for multinational corporations. It notes that MNCs often experience premature return of expatriates due to failed assignments and loss of returned expatriates due to poor repatriation. This can threaten organizational performance. To reduce costs, MNCs aim to improve expatriate management before, during, and after international assignments. The document also outlines an assignment asking students to analyze and address issues relating to expatriate management.
We Also Provide SYNOPSIS AND PROJECT.
Contact www.kimsharma.co.in for best and lowest cost solution or
Email: amitymbaassignment@gmail.com
Call / What’s App: 9971223030
SHRM AND Greenfield Operations
HR personal or department DHS Motors Limited Companynowshin naina
This presentation provides an overview of DHS Motors Limited Company in Bangladesh. It discusses DHS Motors' history of being the first distributor of Honda vehicles in Bangladesh since 1994. The presentation outlines DHS Motors' mission, vision, and objectives of providing high-quality, affordable products to satisfy worldwide customers. It also describes the company's hierarchy, findings from an employee survey, a SWOT analysis, and recommendations to develop new products and technologies to satisfy customers during economic challenges. The conclusion restates the company's goal of pursuing mobility and extending joy to more customers.
Human resource management involves four key activities: staffing, training, motivation, and maintenance. It aims to recruit qualified employees, develop their skills, motivate them, and ensure workplace health and safety. HRM functions include acquisition, development, motivation, and maintenance of employees. It is influenced by internal corporate strategies and external factors like government regulations, technology changes, and economic conditions. Strategic HRM links human resource goals to organizational strategies through job analysis, planning, recruitment, selection, and development of employees.
Innovative Human Resource Practices in Indian Banks: A Study from HR Manager’...Dr. Amarjeet Singh
Banking sector is one of the vital financial pillars of
Indian economy is one of the indispensable money related
mainstays of Indian economy. The progression approach has
influenced the intensity of banks because of the worldwide
weights coming about into mix of Human Resource The
board with business approaches. The review by Boston
Consulting Group (BCG) and Indian Bank's Affiliation
(IBA) report that the Indian keeping money industry will
confront two up and coming difficulties that is an monetarily
feasible answer for monetary consideration and HR structure
in next multi decade. While the main test requests bizarre
advancement and experimentation, the second undermines to
injure the capacity of the biggest fragment of the saving
money industry from having the capacity to advance and
remain aggressive. The special complexities of people in
general division make traditional HR arrangements
ineffectual. The activities like "Pradhan Mantri Jan-Dhan
Yojana" by the Honorable Prime Minister of India, banks
commitment in the budgetary incorporation has helped up,
however the representative's desires from the business have
additionally emerged. This requires a need to advance the
prior HR practices of the banks with the goal that the
representative profitability can be improved. This paper
intends to give an understanding to such advancements,
identified with Human Resource Management with the
assistance of a essential investigation dependent on the
perspectives of HR chiefs of six diverse Indian banks both
from open and private segment. These creative HRM
rehearses have been recorded under seven distinct heads of
HRM to be specific enlistment and determination, preparing
and advancement, execution the executives, pay the
executives, profession improvement, worker inspiration and
representative security. A couple of the prior examinations
have likewise been eluded for the last ends. The dimension of
usage of these advancements may not be tasteful, yet the
usage has been begun and the positive outcomes in the
profitability will make these banks feel how essential these
are for their development. It has been discovered that
intermingling of practices of new and imaginative HR regions
will profit the banks to wind up progressively aggressive.
This document discusses the importance of human resources in modern business and the role of HR. It explains that HR ensures a productive work environment by implementing strategies and practices to effectively manage employees. These include recruitment, training, performance management, and creating policies. The document also outlines the importance of companies being equal opportunity employers. It states that providing equal opportunity and a discrimination-free workplace increases employee motivation, satisfaction, and loyalty, which benefits the organization.
The document discusses various challenges faced by human resource managers and suggestions to overcome them. It defines HRM and lists key functions of HR managers. Some major challenges discussed are attrition, recruitment and training costs due to attrition, retention of employees, effective communication, and competitive challenges due to globalization and new technologies. Suggestions provided include adopting new trends, improving job satisfaction, reducing work pressure, effective training, and embracing new technologies. Examples given are of smoking bans in Japanese companies and challenges faced by an Indian cigarette company.
Importance of integrating Human Resource Management into a business’s strateg...Swapnil Mali
This document discusses the importance of integrating human resource management (HRM) into a business's strategic planning process. It provides examples of how companies like Google and Anglo American have developed innovative HR strategies that helped them attract and retain talent, driving competitive advantage. The document argues that for organizations to meet strategic goals, HR must be involved in planning to ensure human capital needs are addressed and employees are properly motivated. Involving HR enables setting realistic targets and managing performance, while theories discussed emphasize the human aspects of management beyond financial incentives.
Exploring human resource management practices in small and medium sized enter...IAEME Publication
This document summarizes a research paper that explores human resource management (HRM) practices in small and medium enterprises (SMEs) in Bangalore and Mysore, India. The paper reviews literature on HRM practices in SMEs and finds recruitment is informal through personal networks and training is limited. A pilot study tested a questionnaire on HRM practices including recruitment, training, compensation, performance appraisal and welfare measures. The study found the questionnaire to have acceptable internal consistency above 0.7.
First, the number of employees that companies have abroad has increased, creating new global challenges for HR departments. These include candidate identification and selection for global assignments, cost projections for sending employees overseas, creating assignment letters, developing compensation and benefits programs for different countries, providing relocation assistance, and offering family support. Going forward, key HR practices will include increased workplace flexibility, a more global workforce, emphasis on work-life balance, ongoing workforce development, broader job definitions, and a more strategic role for HR. Overall, HR is undergoing a revolutionary transformation and has become more important than ever to business success due to intensifying global competition.
Difference between human resource management and personnel managementsai precious
1. Human resource management focuses on managing people as a valuable resource to achieve organizational goals, while personnel management takes a more administrative approach centered around individual employee needs.
2. Key differences include HRM emphasizing a unified relationship between management and employees, decentralized decision-making, and transformational leadership versus the transactional style of personnel management.
3. HRM also utilizes more flexible employment contracts, job designs centered around teamwork, and pay/incentive policies linked to performance and value-added contributions compared to the traditional functional approach of personnel management.
The document discusses new trends in human resource management (HRM). It covers a variety of topics influencing HRM, including technological changes, economic and political challenges, an aging workforce, skill deficiencies, and changes in the employment relationship. HR must deal with issues like globalization, outsourcing, mergers and acquisitions, and reengineering. The role of HR is shifting from administrative to more strategic. HR needs to anticipate challenges and support organizational strategy.
This document discusses two key issues in human resource management: outsourcing HR activities and business process outsourcing (BPO) and call centers. It provides examples of large companies that outsource HR functions such as payroll and benefits administration. It also discusses the challenges faced by HR managers in retaining employees in BPOs and call centers due to high attrition rates, health issues caused by night shifts and repetitive work, and lack of career growth opportunities. HR managers need innovative strategies to improve employee engagement and prevent burnout in these roles.
This document discusses managing human capital through merit pay plans. It provides background on performance appraisal and compensation programs before examining arguments for and against merit pay. The document outlines examples of merit pay plans in practice and their successes and failures. Guidelines are presented for establishing successful merit pay plans, recognizing that individual and organizational factors must be considered. While merit pay can motivate performance, proper implementation and performance evaluation are necessary.
This document discusses managing human capital through merit pay plans. It provides background on performance appraisal and compensation programs before examining arguments for and against merit pay. The document outlines examples of merit pay plans in practice and their successes and failures. Guidelines are presented for establishing successful merit pay plans, recognizing that individual and organizational factors must be considered. While merit pay can motivate performance, proper implementation and performance evaluation are necessary.
The document discusses strategic reward systems for employees. It states that effective reward systems address compensation, benefits, recognition, and appreciation, and are aligned with business strategies and goals. It emphasizes that reward systems should recognize both performance and behaviors. Performance is easier to address through goals and incentives, while rewarding specific behaviors requires identifying the behaviors important to the company. An effective strategic reward system considers all elements, drives the right behaviors and goals, and does not neglect recognition and appreciation.
For many businesses, attracting, retaining, motivating and rewarding employees are key issues that can be the difference between success and failure. It is also a vital issue for any potential buyer (internal or external) and has a direct impact on business risk, and also value.
As part of our strategic advisory work with clients, we are able to offer a range of solutions to manage these issues and provide easy to implement solutions for business owners to encourage employees to think and act like business owners.
Performance management is undergoing a revolution. Businesses around the world are adopting more flexible systems for appraising their employees. This new trend has likely left you a bit unsettled: "Should I follow this trend?" "If so, what approach is right for my company?" "How do I align my pay strategies with a less structured performance appraisal process?" "What are the performance metrics I should be managing?" If you find yourself grappling with these issues, you will not want to miss these slides! http://www.vladvisors.com/compensation-knowledge-center/webinars/pay-and-the-demise-of-performance-management
Advantage of T&D for HR function like Compensation Shikha Bhatia
Training and development play a key role in an HR compensation function by supporting each stage of the compensation process.
At the assessment stage, training aids in analyzing the organization and labor market. In design, it helps understand compensation components and variable pay systems. Development requires documenting strategies for all compensation practices. Implementation ensures guidelines are followed to balance organizational and individual needs. Evaluation supports reviewing roles and pay for consistency and making improvements. Overall, training strategically links compensation to performance to plan effective reward programs.
Running head FRAMEWORK OF STRATEGIES FOR IHRM FUNCTIONS. .docxwlynn1
Running head: FRAMEWORK OF STRATEGIES FOR IHRM FUNCTIONS.
The Framework of Strategies for IHRM Functions
Woodrow Rowell
10/6/19
FRAMEWORK OF STRATEGIES FOR IHRM
FUNCTIONS 2
Overcoming International Talent Acquisition And Workforce Development Challenges
The international market demands that companies acquire a talented workforce and
develop them so that they can remain relevant in the business and organizational setting.
However, various challenges make it quite hard for firms to hire and maintaining a talented
workforce. Some of the challenges include a satisfying job environment, a gratifying salary,
diversified workforce who can work in any country, and the ability to better the skills of the
workforce.
The enhancement of suitable hiring of people with talent requires that there be
multichannel sourcing of the workforce through both the social media and digital process
because it allows a company to have significant numbers of applicants that the company has to
evaluate, compare and pick from (Oracle, 2017). Often, the interview process should cover all
the essential aspects of the expected duties and objectives of the company. With the simulation
systems and automated digital sources, organizations successfully source, assess, and hire top
talent that boosts acquisition of efficiency and effectiveness in the organization (Edmans,
Gabaix, & Genter, 2017). Cloud solutions enhance multitiered screening and evaluation tools to
enhance the interview and requisition of management to have recruiters and hiring process as
positively impressive as possible. Once the workforce who are talented are hired, a company
should work to train and offer them learning opportunities that will make them both more
efficient in their line of specialization and related ones.
FRAMEWORK OF STRATEGIES FOR IHRM
FUNCTIONS 3
Additionally, the provision of high compensation is another thing a company should offer
even though it is important the compensation suits within the budgetary estimates and is reliably
assessed before one is offered the amount (International Labour Office, 2011). Such a process
will discourage flaws and motivate every worker to do their best (Oracle, 2017). The threat is
that the company has to be quite efficient in choosing the digital solution and assessing the
workforce. Overall, the international HR management sector will increase performance,
productivity, and boost the reputation of the company. The process can also enhance efficient
global management of the workforce and generation of objectives in the international business.
Integrating Self-Managing Teams and HR Processes
Self-Managed Teams have been projected to be a productivity step forward for
organizations since the 1990s. Several businesses have reported on the success result from the
self-managed teams, and the SMTs have also received momentum from people .
Career planning & compensation managementdivyagnim
The document discusses various topics related to career planning and compensation management. It covers career development, the importance of career development for both employees and organizations, factors that can impact careers like economic changes. It also discusses designing career development systems, what a career development plan is and its purpose. Other topics covered include succession planning, wage and salary administration, pay-for-performance plans, fringe benefits, and employee stock option plans.
Compensation management involves designing total compensation packages to attract, motivate and retain employees. It includes direct pay like salary as well as indirect benefits. Compensation aims to achieve business goals while meeting legal requirements. Factors like an employee's role, market pay and organizational needs determine compensation. Common elements are basic pay, incentives, and statutory benefits. Recent trends include stock ownership plans and long-term incentive programs.
This document provides an overview of a two-day training program on remuneration strategy and salary structuring. The training will cover topics such as introduction to rewards management, building a salary structure, variable pay schemes, and alternative remuneration structures. It includes an agenda with sections on strategic total rewards management, attracting and retaining top talent through rewards, and measuring the effectiveness of rewards programs. The goal is to help organizations design competitive and aligned remuneration packages.
Employees who are satisfied with their jobs perform better. Companies should create an atmosphere where employees feel appreciated and can advance. Performance appraisal and reward systems let employees know their work is valued. These systems include bonuses, profit sharing, stock options, and recognition programs. They boost morale and motivate employees to exceed expectations. Effective communication, understanding personalities, training, and motivation techniques allow managers to maximize employee potential.
This document discusses performance appraisal and provides details about:
1. It defines performance appraisal as a systematic evaluation of employees by supervisors and discusses why appraisals are conducted.
2. It describes different methods of performance appraisal used in companies like behaviorally anchored rating scales, human resource accounting, management by objectives, 360 degree feedback, and the rating scale method used by BMW.
3. It provides an overview of BMW, including that it is a German automaker known for luxury vehicles and motorcycles, and discusses BMW's operations in India including its assembly plant in Chennai.
The document discusses competency-based management and its components. It defines competency as any knowledge, skill, personality characteristic or behavior that distinguishes superior performers. Competency-based management identifies an organization's distinctive competencies through analysis of top performers. It then designs training to teach these competencies. The document provides examples of competency training programs and discusses how competency-based management can benefit employees and organizations.
Pay-for-performance aims to motivate employee behaviors through compensation. Research shows compensation influences joining, retention, skill development, and performance, though other non-pay factors also impact behaviors. Effective pay-for-performance requires: supporting business strategy through aligned structure and standards; distributing rewards fairly through amounts and procedures; and complying with laws to maintain reputation. Research overwhelmingly finds compensation motivates behaviors when designed and implemented properly.
12Incentive PayMedia LibraryCHAPTER 12 Media LibraryPREM.docxaulasnilda
12
Incentive Pay
Media Library
CHAPTER 12 Media Library
PREMIUM VIDEO
HRM in Action
Incentive Pay
LICENSED VIDEO
Pay for Performance
Bonuses
LEARNING OBJECTIVES
After studying this chapter, you should be able to do the following:
12-1. Discuss the major reasons why companies use incentive pay.PAGE 425
12-2. Identify the advantages and disadvantages of both individual and group incentives.PAGE 427
12-3. Briefly discuss options for individual incentives.PAGE 431
12-4. Briefly discuss options for group-based incentives.PAGE 439
12-5. Discuss the major reasons why incentive plans fail and the challenges involved.PAGE 443
12-6. Identify the guidelines for creating motivational incentive systems.PAGE 445
12-7. Discuss the issue of executive compensation and how the major provisions of the Dodd-Frank Act affect the issue.PAGE 449
12-8. Briefly discuss the question of whether incentives improve performance and some options available for incentivizing employees other than knowledge workers.PAGE 453
CHAPTER OUTLINE
Incentive Compensation
Why Do We Use Incentive Pay?
Individual or Group-Based Incentives?
Individual Incentives
Group Incentives
Options for Individual Incentives
Bonus
Commissions
Merit Pay
Piecework Plans
Standard Hour Plans
Giving Praise and Other Nonmonetary Incentives
Options for Group Incentives
Profit-Sharing Plans
Gainsharing Plans
Employee Stock Ownership Plan (ESOP)
Stock Options and Stock Purchasing Plans
Failures and Challenges in Creating Incentive Pay Systems
Why Do Incentive Pay Systems Fail?
Challenges to Incentive Pay Systems
Guidelines for Creating Motivational Incentive Systems
Executive Compensation
Too Much or Just Enough?
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
Executive Incentives
Short-Term Versus Long-Term
The Goal of Executive Compensation
Trends and Issues in HRM
Does Incentive Pay Actually Improve Performance?
Comprehensive Pay and Incentive Programs Aren’t Just for Highly Skilled Employees
p.425
Practitioner’s Perspective
Cindy reflects: Whether the economy is up or down, your star employees can always find another job. This keeps HR departments looking for ways to keep their best employees motivated and engaged in their positions.
One of Cindy’s colleagues, Terry, is a big advocate of incentive pay. “We need to look at ways to reward our exceptional employees now without expanding our base labor costs into future years,” Terry said at one of their strategy meetings. “I’ve seen evidence to support the case that employees work harder if they know they have a fair chance of being rewarded for that extra effort.”
“Well, I’ve heard lots of complaints against incentive pay,” says Bill, another member of their department. “I’m not sure we want to open our compensation program to those issues.”
Is incentive pay a good idea? The pros and cons plus the methods of implementation are detailed for your consideration in Chapter 12.
INCENTIVE COMPENSATION
LO 12- ...
Performance management in hospitals focuses on clinical outcomes, patient satisfaction, and operational efficiency. Key metrics include mortality and complication rates, patient experience scores, average length of stay, and operating costs. For electrical retailers, common metrics center around sales, profits, inventory levels, and customer service. Retailers track sales targets, gross and net profits, stock turnover rate, and metrics like average handling time per customer call. Both sectors also monitor employee engagement and development through performance reviews.
The document discusses reward management systems and total rewards programs. It provides an overview of reward management, including developing, implementing, and evaluating reward processes that deal with job assessment, pay structures, performance management, compensation, benefits, and pensions. It also discusses the importance of motivation and using reward systems to boost employee motivation. The total rewards program of a large beverage company with operations in multiple countries is then described.
This document discusses reward systems in private organizations. It covers several topics:
- Management of rewards and incentives, including rewarding superior performance and improving working conditions.
- Performance appraisal, including potential appraisal and performance review/counseling.
- Using compensation as a tool to motivate employees. It discusses types of rewards and determining appropriate rates of pay, including salary increases, size of merit increases, and pay increases on promotion.
- The relationship between compensation strategy and strategic human resource management.
Hiring, training, and evaluating employees is important for a firm's performance. A firm must effectively manage its human resources to achieve its goals. The document discusses human resource planning including forecasting employee demand, job analysis, and recruiting. It also covers providing equal opportunity, compensation packages, developing employee skills through training, and evaluating employee performance.
This document provides an introduction to a study on performance appraisal at Hindustan Aeronautics Limited (HAL). It discusses HAL's role as an aerospace company in India. It then outlines the objectives and methodology of the study, which includes collecting primary and secondary data on HAL's performance appraisal practices through questionnaires, interviews and documentation review. The study aims to evaluate HAL's performance appraisal system and identify areas for improvement. It discusses limitations and provides an overview of how the report will be structured.
1. Managing Human Capital
Table of Contents Page no.
1. Executive Summary 1
2. Introduction 2
3. Reward structure 3
4. Performance appraisal 4
5. Compensation and Benefits 4
6. The Law and Compensation 5
7. Merit pay plan 6
8. Merit pay plans in practice 7
9. Discussion and debate 7
10. Examples of Merit Pay 7
11. Successes and Failures of Merit Pay Plans 9
12. Personal Point of View 10
13. Guidelines for Merit Pay Plans 10
14. Conclusion 11
15. References 12
16. Bibliography 13
2. Managing Human Capital
Executive Summary
Human capital is the only living breathing capital in an organization that has a thought of its
own. Managing these human capitals or employee or staff as commonly referred is a great
challenge. Recruiting, motivating, compensating all the activities of Human Resource
Management (HRM) has significant impact on how the employee responds to the policies
introduced by the organization.
The purpose of this report was to discuss and debate with supplementary study of the factors
influencing and contradicting on the part of any management to award employees with merit
issues. Due to lack of data regarding the merit pay plan and its success all recommendations
were made based on assumptions found from critics who argued in support and against the merit
pay plan. Further assessments derived from various studies on success and failure rate and
example of organizations applying merit pay plan in practice.
Studies suggest that it is hard to say whether awarding employees on merit issue will positively
reinforce and motivate towards optimum output as there are certain factors to be considered and
clarified before initiating such concept in to practice. First of all, there is no standard way to
evaluate merit. Moreover the evaluations made by management may differ with the employee’s
perception. Individualistic mentality may roam the cubicles of each employee as they become
self-cantered about proving they are the best. Then again fixing and regulating the pay increase
in proper manner is not as easy at it sounds.
Taking all these in account still merit pay plan has proven to be successful for many esteemed
and renowned organizations. A simple Guideline acknowledgement helped such organizations to
initiate merit pay plans and rip the seeds of success. In this report some guidelines are given in
support of initiating merit pay plans for employees on any part of management.
The report was limited to time constraints and access of data. My apologies for any mistakes
arising from lack of depth study and sheer inexperience, despite all the efforts made to make it
authentic as possible.
3. Managing Human Capital
Introduction
Human capital is the total value of human resources to the organization. Also sometimes referred
to as intellectual capital, it is composed of the people in the organization and what capabilities
they have and can utilize in their jobs.
Managing human capital or commonly known as Human Resource Management(HRM) is a
formal management system concerned with staffing the organization, training and development,
maintaining high performance, total rewards, employee relations, labor-management
environments and so beyond to ensure the effective and efficient use of human talent to
accomplish the organizational goals. In a seed wrap the key words representing HRM are:
• Achieving success through people
• Getting the right people with the right skills for the right job
• Enhancing motivation and commitment through performance appraisal and
reinforcements
• Creating the perfect productive and harmonious work environment.
In order to enhance the efficiency and effectiveness of the efforts of even the most skilled and
capable employees HRM must ensure proper motivation is provided. It must be made sure that
desired actions are positively reinforced through rewards and wrong ones are punished. But it’s
hard to select the best method of reward as the employees wants and desires differ from one
another. For an employer to decide on a perfect reward plan to motivate all the employees as
whole is a great challenge. Performance appraisal is one of the ways to evaluate an employee’s
work.
Every employee expects a paycheck or compensation in return for the service or labor s/he
spends. Unless the effort is rewarded through proper motivating compensation the performance
4. Managing Human Capital
tend to decrease. The most obvious reward employees receive from work is pay. Rewards may
also be in the form of promotions, desirable work, assignments, and a host of other recognition.
Reward structure
Rewards are positive feedback and provide reinforcement, or encouragement, for the employee
to work harder in the future. The three most typical dichotomies are: intrinsic versus extrinsic
rewards, financial versus nonfinancial rewards, and performance-based versus membership-
based rewards. A structure of rewards is shown in a chart to simplify and exhibit the three most
typical dichotomies for a better understanding of the features and relative differences.
5. Managing Human Capital
(A.Decenzo & P. Robbins (2008), Fundamentals of Human Resource Management, Singapore:
John Wiley & sons (Asia) pte ltd.)
Performance appraisal
Performance appraisal is the single most important management tool in a sophisticated well-
managed organization. No other management process has as much influence over individuals’
careers and work lives. Properly utilized, performance appraisal is the most powerful instrument
that organizations have to mobilize the energy of every employee of the enterprise toward the
achievement of strategic goals. Used well, performance appraisal can focus every person’s
6. Managing Human Capital
attention on the company’s mission, vision, and values. But used poorly, the procedure quickly
becomes the butt of jokes and the target of Dilbert lampoons. [Dick Grote (2002),.The
Performance Appraisal Question and Answer Book: A Survival Guide for Managers, New York:
AMACOM]
Compensation and Benefits
Once employee performance has been measured, it must be linked to compensation programs.
Unlike traditional compensation programs that provide “cost-of-living” or other across-the-board
pay increases, the greatest challenge is to develop and implement more performance-oriented
reward programs. Some of the most common compensation programs are-
• ESOP- Employee Share Ownership Plan is an equity based, deferred and defined
compensation/ benefit plan that allows employees become owners of shares of the
company they work for.
• Gain sharing- a team approach where all the employees of a site, operation or project
receive some financial gain through higher levels of performance or performance
improvement. It is a management system for organizations to motivate employees
through rewards.
• Profit Sharing- an incentive based compensation plan that awards eligible employees a
percentage of company’s pre-tax profits, weighted by the employees base salary an given
on an annual basis.
• Scanlon Plan- A team incentive program focused on the cooperation between
management and employees through sharing problems, goals, and ideas on sharing cost
savings and productivity gains.
• Annual Bonus- A distribution of profit as declared bonus given by the company on an
annual percentage rate which is added to the unit price of the fund on a daily basis. The
rate may change on an annual basis or even more frequently.
7. Managing Human Capital
• Performance based pay plans-The label pay for performance covers a broad spectrum
of compensation systems that can be clustered under two general categories: merit pay
plans and variable pay plans, which include both individual and group incentive plans.
The Law and Compensation
Over the past thirty years numerous laws and regulations have been enacted at national, state,
and local levels. Every year these regulations have been expanded due to regulatory actions and
judicial decisions. As a result, in case of compensating an employee there are certain legal
considerations and laws that are mandated through government legislation that are to be strictly
maintained
Fair Labor Standards Act of 1938 (FLSA)
• Equal Pay Act (EPA)
Passed in 1963, the Equal Pay Act amended the FLSA, requiring that males and females
performing the same work be paid the same wages.
• Civil Rights Act of 1964
• Employee Retirement Income Security Act (ERISA)
• Internal Revenue Code (IRC)
Merit pay plan
Merit pay plan is one of the performance-based reward programmes. Although often used as a
substitute to cost-of-living raises still it has its own unique turfs and criticisms. It is one popular
and almost universally most, widely used incentive system.
8. Managing Human Capital
An incentive plan resulting in increase in pay annually or periodically; implemented on an
organizational wide basis such plans grants employees equal opportunity considerations,
regardless of funding source. The merit increase program can be implemented when funds are
designated for that purpose by the organization's administration, dependent upon the availability
of funds and other constraints. .
Arguments In Support of Merit pay Arguments Against Merit pay
• Allows the employer to differentiate • No proper way to measure merit
pay given to high performers
• Allows a differentiation between • The pay is subjective
individual and company performance
• Allows the employer to satisfactorily
reward an employee for accomplishing
a task that might not be repeated (such
as implementation of new systems)
Merit pay plans in practice
The most issue regarding merit pay is the merit pay plan for teachers initiated by Barak Obama
the president of United States. More or less discussions and debate took place about how merit
could be administered. A gist of all that is given here
Discussion and debate
9. Managing Human Capital
The new emphasis on performance appraisal and merit pay calls for a thorough examination of
their effectiveness. Pay for Performance Is the best resource to date on the issues of whether
these concepts work and how they can be applied most effectively in the workplace.
Propositions had been put to the test at universities, one group modifying the way merit pays are
allocated and the other constructing a parley for an administration proposal to adjust any salary
raises that aren't based on merit or performance issues.
Issues are quite complex. Persistently, they find administrations intent on making strategic use of
merit pay on basic salary, often the issue of employee conflict as they don't partially disagree
with the administration's priorities. But such disputes can also crater staff members against each
other, high-performing departments which are higher-paid fighting against those with smaller
budgets, higher-achieving employees against "dead wood," rapidly expanding or on growing
disciplines versus those that are stagnating or declining. Besides, a common agreement about
what exactly "merit" or "performance," or "incentive pay" plans entail is still a concept vaguely
defined.( http://www.mackinac.org/9801)
Examples of Merit Pay
1. In Maryland. Towson University, tensions bubbled the surface as faculty, over the past
two years, hashed out an alternative plan to the current method of doling out merit raises
based at the department level. But for now, at least, faculty members and the
administration seem to have come to a negotiation that they can more or less live with, at
least for a two-year trial period.( http://www.mackinac.org/9801)
2. Meanwhile at Temple University, the administration is attempting to switch entirely to
"pay per performance" raises that would not take cost-of-living increases or other factors
into account -- a change the faculty union vigorously opposes.( http://www.mackinac.org/
9801)
Historically, resistance to merit pay resulted in few highly criticized trial programs.
However, in recent, many states around the nation, in districts large and small; rural,
urban and suburban, have begun implementing awards on merit issues. Even if only a
10. Managing Human Capital
few scrupulous studies of merit-pay programs have been conducted, research has begun
to suggest that well-designed merit pay plans can lead to better student achievement.(
http://www.mackinac.org/9801)
3. The Achievement Challenge Pilot Project, instituted in the Little Rock public schools
from 2004-2007, was a merit-pay plan tying bonuses for school personnel solely to
students progress on standardized tests. (http://www.mackinac.org/9801)
4. An evaluation program led by Marcus Winters and Gary Ritter of the University of
Arkansas mentioned that the students of ACPP schools had somewhat large and
statistically significant gains in math and language arts compared to students in
nonparticipating district schools. Nevertheless, critics of merit pay suggest teachers may
begin to compete, rather than collaborate, and avoid working with traditionally low-
performing students, the ACPP evaluation found no evidence of these problems.(
http://www.mackinac.org/9801)
5. Additional programs, such as the Teacher Advancement Program, merge merit pay with
other rewards. TAP was initiated by the Milken Family Foundation, and the program is
currently being implemented in over 180 schools in 13 states nationwide.()
http://www.mackinac.org/9801)
6. Another prominent plan containing elements of merit pay is "ProComp,the Denver
Professional Compensation System. Akin to Chicago’s REAL, ProComp was adopted
with support from the local teachers union such as the Denver Classroom Teachers
Association. Though the plan started as a pilot project in 1999 and then expanded to
allow all Denver Public Schools teachers to participate in 200 Denver voters also
approved a $25million tax initiative to help finance ProComp in November 2005. (http://
www.mackinac.org/9801)
11. Managing Human Capital
Successes and Failures of Merit Pay Plans
As merit pay has grown more than popular, it is becoming apparent that these plans have both
succeeded and failed. One study of employers found that despite the fact that 61% of the
companies have variable pay plans; almost half of them did not achieve their performance targets
for the year. But to avoid negative employee reactions, many of those companies paid out 85%
of the incentives anyway. The good news from the study is that over half of the merit pay plans
achieved their performance objectives. Executive-focused merit pay plans tend to be viewed as
more successful than those used with lower-level, non management employees.
The responses of employees are crucial to how merit pay plans carry out. It is interesting that in a
study of over 2,000 workers from a variety of companies, most respondents said they want
performance rewards included in their base pay, rather than as one-time payments. Also, the
employees strongly preferred individual rewards over team or organization incentives. These
studies and others highlight the fact that neither of the polar extremes—the view that incentives
do not work versus the view that incentives are a panacea—appears to be the case. Also, the
enthusiasm that many employers and managers have for merit pay plans is not matched by many
workers. The key to success seems to be to combine incentives with employee participation in
the process.
In summary, it appears that merit pay plans are successful under certain circumstances. A
number of factors affect the success of merit pay plans. The next section discusses the guidelines
for establishing successful merit pay plans.
Personal Point of View
It’s hard to say the impact and the response of any part of management to award employees with
merit issues. Although merit pay plan has certainly proven to be successful in many
organizations but to maintain a suitable condition for merit pay plans to function orderly depends
on the management itself. There is no confusion that merit pay plan was introduced to encourage
employees to show best performance and merits. The one who performs or shows most merit
12. Managing Human Capital
gets an pay increase. I would it is a good idea. But before initiating such concept the employees
and management should well educated about the term performance based pay and variable pay.
Like everything it also has its ups and downs. Certain things are to be considered while initiating
merit pay plans. One of the biggest pitfalls is that there is no standard measuring tool of merit.
Usually supervisors are the ones who do the evaluation. So biasness or inappropriate evaluation
sometimes may lead to employee-manager or employee-employee conflict. The evaluation done
by the organization may seem unfair to the employee.
Guidelines for Merit Pay Plans
Providing merit pay through incentive systems can be complex and can take many forms.
However, certain general guidelines are useful in establishing and maintaining successful merit
pay systems.
o Recognize organizational culture and resources
o Make merit pay plans understandable
o Keep incentive plans current
o Link the merit pay to desired performance
o Recognize individual differences
o Identify merit pay separately from base pay
Conclusion
The evidence on the effects of pay for performance, pieced together from research, theory,
clinical studies, and surveys of practice, suggests that, in certain circumstances, variable pay
13. Managing Human Capital
plans produce positive effects on individual job performance. The evidence is insufficient,
however, to determine conclusively whether merit pay can enhance individual performance or to
allow making comparative statements about merit and variable pay plans.
On the basis of analogy from studies and theories on variable pay plans, I would conclude that
merit pay can have positive effects on individual as well as organizational job performance. But
all these effects can be attenuated by the facts that, merit plans, pay increases are not always
clearly linked to employee performance, performance evaluation agreement exists, and increases
are not always viewed as wise decision. Nonetheless, it is believable that the direction of effects
is toward enhanced performance.
References
Book
14. Managing Human Capital
1. A. Decenzo & P. Robbins (2008), Fundamentals of Human Resource
Management, Singapore: John Wiley & sons (Asia) pte ltd.
2. Dick Grote (2002),.The Performance Appraisal Question and Answer Book: A
Survival Guide for Managers, New York: AMACOM
3. John McManus, Leadership: Project and Human Capital Management,
Burlington: Butterworth-Heinemann
4. Noe, Human Resource Management, Delhi: Darling Kindersley (India) pvt.
Ltd.
Internet
1. Examples of Merit Pay
http://www.mackinac.org/9801
2. Pay for Performance: Evaluating Performance Appraisal and Merit
Pay (1991)
http://www.nap.edu/openbook.php?isbn=0309044278&page=77
3. Debate: Merit pay for teachers
http://debatepedia.idebate.org/en/index.php/Debate:_Merit_pay_for_te
achers
15. Managing Human Capital
Bibliography
Book
1. A.Decenzo & P. Robbins (2008), Fundamentals of Human Resource
Management,8th edition, Singapore: John Wiley & sons (Asia) pte ltd., p-275
2. Dick Grote (2002),.The Performance Appraisal Question and Answer Book: A
Survival Guide for Managers, New York: AMACOM,p-1
Internet
1. Examples of Merit Pay
http://www.mackinac.org/9801
2. Pay for Performance: Evaluating Performance Appraisal and Merit
Pay (1991)
http://www.nap.edu/openbook.php?isbn=0309044278&page=77
3. Debate: Merit pay for teachers
http://debatepedia.idebate.org/en/index.php/Debate:_Merit_pay_for_te
achers