The Performance Evaluation and Bonus

Perhaps one of the most challenging aspects of managing a company is to provide a public presentation evaluation technique that does not frighten employees. The fear in my organization, among those marginal performers, is that the evaluation may fartheste their being fired. One of the most controversial tools for boosting performance is ranking employees and dismissing the laggards. Proponents argue that the practice stretches star employees(Marchetti 2005 16). Those at the bottom of the performance scale tend not to be as motivated as they readiness be, simply because the fear of being poorly evaluated stifles their determination to improve.While there are many companies which mechani bellowy provide a cost of living raise to their employees (sometimes due to labor contracts), the idea of providing bonuses or be awards also can cause some serious bothers, and such merit raises often cause more than conflict within a business than they solve in the way of increased productiv ity and/or efficiency. Here is one authors proof Its wrap up that employers compensation systems arent making the grade. Only 10 percent of organizations discover their merit pay programs as very effective, according to an employee attitude survey conducted in 2002 of 335 companies by convert Insight (the research and survey arm of Philadelphia-based HR consulting firm The Hay Group), WorldatWork and Loyola University of Chicago (Wells 2005 76).One problem with many businesses today is that management is too lenient, too worried about hurting someones feelings. In todays militant world, where every worker must pull his weight or make way for someone who can, such leniency may be costly. Wells (2005) suggests something called tough love.By contrast, adoptingand enforcingthe get-tough approach to merit pay has clear advantages It doesnt waste increasingly precious salary-budget dollars, it sends the right message that improvement is imperative, and it doesnt fund under-performers a t the expense of high-performing employees (Wells 2005 78).In my particular organization, the idea of performance evaluation and some sort of bonus or merit award is now no longer strictly limited to the assoil performers. It is the middle level, what some tend to call B performers that have some stake in the companys bottom store. Again, here is some proof of that Midlevel performers succeed when they know theyve got something to work towardand youve got to give that to them. In fact, 52 percent of respondents who qualify for incentive programs at their companieswhich typically reward the top 10 percent of workersfeel they have only somewhat or no chance of winning an award. This is far from motivating. Your B-players have a significant effect on your bottom line, says Rodger Stotz, frailness president and managing consultant for Maritz Inc. Youll always have a top five percent, but those rewards dont move the middle (Galea 2005 9).What is need to ease the pain and strain of p erformance evaluation and resultant merit increases or bonuses is the fact that top management must now set specific targets and goals, by the month, by the quarter, by six months, annually, and yet provides some projections for one, two and five years into the future. With such goals specifically outlined, employees- whether on a production line or white collar, now know exactly what is required of them.To make performance evaluation less(prenominal) painful and more effective requires supervisors to keep track of performance of their section or departments, as wellhead as individual employees. In this way, if someone falls short, there is an opportunity for a one-on-one sermon that may provide both a reason for such a shortfall and a sum of improving performance. This personal oversight by supervisors can go a long way to go on the fear of being discharged as a marginal or low performer, and at the similar time reward what Galea (2005) calls B Performers.Therefore, what will make performance evaluation and compensation tied to it far more effective in my company is to focus on these mid-=level performers as well as providing a means up the ladder for the marginal ones, knowing the top performers will always address to shine. By also stressing teamwork, it becomes the responsibility of everyone within a section or department to make received everyone contributes to reaching the goal.