SalaryReviewGuidelines Guidelinesonthedistributionofincrements anattempttoovercomethevaryingstandardsofjudgmentleadingtoan allmyducksareswans approachtorewardingstaff Thedistributionscalemayberelatedtoaguidelinelikethis AssessmentIncrement DistributionA outstanding9 10 10 B good7 8 20 C satisfactory4 6 50 D needsimprovement0 10 E unsatisfactory0 10 SalaryReviewGuidelines Guidelinesonratesofprogression managersarehelpedtoplansalaryprogressionbybeinggivenanindicationofthenumberofyearsitshouldtakestaffatdifferentlevelsofperformancetoreachthetopofthegradeand inzonesofsalaryrange thelimitswithintherangewhichcanbereachaccordingtotheirperformance AssessmentLimitInGradeTypicalLengthLearningzone1to3years2yearsPerformingzone4to6years5yearsExceedingzone2to4years3years SalaryProblems Absorbingmarketratespressures ariseswhengeneralandindividualsalaryreviewshavenotenabledthecompany ssalarylevelstokeeppacewithincreaseinmarketrates itisexacerbatedifthecompanyisexpandingandiscompelledtoobtainkeystaffwhoareinshortsupply Wideningdifferentials differentialsarewideningbetweenandwithincompaniesinthefollowingareas betweenhigh andlow payingorganizations thevariationsinprosperitybetweendifferingsectorsofindustryandcommerceandbetweenregionsaremajorcontributorstothisproblems betweencompaniespayingbonusesorincentivesandthosepayingstraightsalaries SalaryProblems betweentopandmiddlemanagementwithincompanies thisispartlyincentiveled betweenexecutivesrecruitedbysearchandthosewithaone companycareer Performancepay tendtofavourthefewwhoseresultscanbemeasured merit assessmentaretoooftenbasedonsubjectiveandbiasedjudgments canbeavoidedonlybyintensivetrainingofassessorsandbycarefulmonitoringoftheappraisalscheme SalaryProblems Staffreachingthetopoftheirsalaryleague staffreachingthetopoftheirsalaryrangemayfeeldemotivatediftherearenoprospectsforpromotion itispossibletodealwiththisproblembyintroducingontopofthenormalsalaryrangeapremiumzonewhichisreservedforoutstandingstaffwhosepromotionisblocked Startingsalaries theproblemofstartingnewstaffathigherratesthanexistingemployeesshouldbeminimizedifinternalsalarylevelsareregularlyreviewedincomparisonwithmarketrates SalaryProblems Deterioratingjobevaluationschemes theschememaynothavebeencontrolledproperly sothatgradedriftoccursthroughunjustifiableupgradings schememayhavelostcredibilitybecauseitnolongergivesacceptablesolutions administrationmayhavebecomesobureaucraticthatthetimetakentoproduceanswersisundulyprolonged thesolutionistomakeadeterminedefforttotightencontrolsandspeedupadministration makingonlyminormodificationstothescheme ObjectivesofPerformance RelatedPay PRP Motivateallemployees notjustthehigh flyers Increasethecommitmentofemployeesbyencouragingthemtoidentifywithitsmissionandvalues Reinforceexistingculturesandvaluestofosterhighlevelsofperformance innovationandteamwork Helptochangecultureswheretheyneedtobecomemoreperformance orientedandresults oriented orwheretheadoptionofothernewandkeyvaluesshouldberewarded Discriminateconsistentlyandbeequitableonthedistributionofrewardstoemployeesaccordingtotheirperformanceresultsandcontributions ObjectivesofPerformance RelatedPay PRP Deliverapositivemessageaboutperformanceexpectationsofthecompany focusesattentiononkeyperformanceissues Directattentionandendeavourbyspecifyingtheorganization sperformancegoalsandstandards Emphasizeindividualperformanceorteamworkasappropriate Improvetherecruitmentandretentionofhigh qualitystaff PRPcostswillbeinlinewithcompanyperformance KeyFactorstoConsiderWhenIntroducingPRP MatchingtheculturesuccessfulPRPschemesneedtomatchthecultureandcorevaluesoftheorganization LinkingPRPtobusinessstrategythefocusneedstobeonstrategicbusinessissueswhichemergefromthebusinessplanningprocess BalancingquantitativeandqualitativemeasureswhilemostPRPschemesrelyonquantitativemeasuresofperformance qualitativefactorsneedtobeintroducedforthemeasurementofindividualbehaviouregbalancedscorecardsTheneedforflexibilityflexibilityinmaking milestone paymentswhichconveytherightmessagesforthefuture Theneedtopromoteteamworktheimportanceofteamworkshouldberecognizedinstructuringtheschemeanddefiningcriticalsuccessfactorsandperformanceindicators KeyFactorstoConsiderWhenIntroducingPRP Theneedtoavoidshort termthinkingsettinglong termaswellasshort termgoals anddiscussingshort termobjectivesintheiroverallcontext InvolvementinthedesignprocessdesigningPRPschemesshouldbeaniterativeprocess tryingandtestingideasonmeasuresandstructureswiththosewhowilleventuallybeinvolvedinascheme GettingthemessageacrossalltypesofPRPareverypowerfulformsofcommunication Togettherightmessagesacrossforanyscheme onemustmakekeydecisionsonthefollowing Howcantheschemeachievethebestpossiblelaunch Isitbettertogivenopay outratherthanalowpay out Whatisthebestpsychologicalmomentforpay out Whatcommunicationsshouldbeusedtogainmaximummotivationalimpactfrompayment Howshouldcommunicationsbehandledwhentheschemerequireschanges Competencebands Excellent Good Satisfactory PerformanceLevels Performing Learning Competenceand