What are the 3 characteristics of a goal?
- Difficult
- Specific
- Believable
What is the key to success between employees and managers?
Communication
What’s the first step in designing compensation?
Know the business strategy!
- Where do we compete?
- What unique value do we bring?
- What resources / capabilities do we utilize?
- How do we sustain our unique values?
What is Efficiency Wage Theory?
Suggests that if you pay above the market, you will
- attract better talent
- employees will work harder and be less likely to shirk for fear of losing their job, and
- less likely to voluntarily leave.
Compare Equity Theory and Fairness
Equity theory involves comparing inputs and outputs – Equity versus equality. Suggests employee motivation at work is largely driven by their sense of fairness
Job-Based Pay Structure
Focuses on the work content (tasks, behaviors, roles, and responsibilities)
Person-Based Pay Structure
Focused on KSAOs (knowledge, skills, abilities, and other characteristics) of the employee in role (detailed, customized)
What will be affected by pay level and structure decisions (5 things)?
- Operating expenses
- Applicant pool (size and quality)
- Turnover
- Union Status
- Organizational Climate
What are the 7 traditional uses of Performance Management?
- Performance Feedback*
- Compensation/Rewards*
- Performance Improvement*
- Motivation
- Talent Decisions (staffing)
- Legal Documentation
- Coaching for Development
*most common
What is Performance Management?
A set of management and analytical processes that enable the management of an organization’s performance to achieve goals.
What are the goals of Performance Management?
- Improve org performance
- Create differentiation of rewards
What are the assumptions of Performance Management?
- Employees are at least partially extrinsically motivated;
- talent is mobile
What are the actions of Performance Management?
- Goal setting and follow-up
- Measurement
- Actions
Why should we have a Performance Management system?
- Differentiate Performance
- Provide Performance Feedback
- Guide Compensation
What methods are available for Performance Management?
- Performance Appraisal: key: what are we comparing to?
- Electronic document
- Balance Scorecard – combines individual and organizational goals
- 360 degree review – more as a developmental tool
- Self Review – adv so manager can see how well communicating (Insight into where ee thinks they are and easier to deliver message from mgr.)
What is Internal Alignment?
How to differentiate jobs and pay relative to each other and the value they add to the organization.
What is Intrinsic Motivation?
Actions that are driven by internal rewards (i.e. doing it because you want to, not because of pay, culture, etc.)
What is Extrinsic Motivation?
Actions/motivation that is driven by external rewards.
What is a Job Description?
A summary of the most important features of a job. It identifies the job and describes the general nature of the work, specific task responsibilities, outcomes, and the employee characteristics required to perform the job.
What is a Job Evaluation?
A systematic procedure designed to aid in establishing pay differentials among jobs within a single company. It includes classification, comparison of the relative worth of jobs, blending internal and external market forces, measurement, negotiation, and judgment.
What is a Job Evaluation based off of?
- job content
- skills
- value add to organization
Reliability
Does it produce the same results every time?
Validity
Did it measure what I wanted to? (accuracy)
What is a Job Analysis?
The systematic process of collecting information related to the nature of a specific job that provides the knowledge needed to define jobs for job evaluation
