Human Resources Management's Incentive and Compensate for Performance.

Human Resources Management's Incentive and Compensate for Performance.

Human resources management incentive and compensation for performance refer to the strategies and tools used by organizations to motivate and reward employees for their hard work and contribution to the company's success. This can include a range of incentives and rewards, such as performance-based bonuses, recognition and awards, stock options and profit sharing, commission-based pay, pay raises and promotions, flexible work arrangements, and employee benefits.

The goal of these incentives and compensation strategies is to create a positive work environment, improve employee morale, and encourage employees to perform at their best.

(Anyebe, 2017) Stated that Incentives and compensation for performance are important tools in Human Resource Management to motivate employees to perform at their best and achieve organizational goals. Incentives refer to rewards or bonuses that are offered to employees in recognition of their performance or contribution to the organization. Examples of incentives include bonuses, stock options, and profit-sharing plans. These incentives can be given on an individual, team, or company-wide basis and can be tied to specific performance metrics or goals. Compensation for performance refers to the overall pay structure of an organization and how it is linked to individual performance. Performance-based pay systems, such as merit-based pay and performance bonuses, link an employee's pay directly to their performance. This can motivate employees to work harder and improve their performance in order to earn higher pay. Incentives and compensation for performance can be an effective way to motivate employees and improve overall performance, but it is important for organizations to ensure that these programs are designed fairly and transparently. Clear criteria for how incentives and performance-based pay are awarded should be established and communicated clearly to all employees to avoid any perception of favoritism or unfairness (Armstrong, 2019).

Here are some additional points to consider about incentives and compensation for performance in Human Resource Management:

·         Incentives and compensation for performance can be used to align employee goals with organizational goals. By tying rewards to specific performance metrics, employees are more likely to focus their efforts on tasks that directly contribute to the success of the organization.

·         It's important to consider the type of incentive or compensation plan that will be most effective for your organization. Some types of incentives, such as bonuses or profit-sharing plans, may be more effective in certain industries or for certain types of employees than others.

·         Incentives and compensation plans should be reviewed regularly to ensure that they are still effective in motivating employees and achieving organizational goals. Over time, factors such as changes in the industry or the job market may require adjustments to incentive programs to ensure they remain effective.

·         It's also important to consider the potential unintended consequences of incentives and compensation for performance. For example, if an incentive program is focused solely on individual performance, it may discourage teamwork and collaboration. Additionally, if the metrics used to determine performance are not carefully chosen, employees may focus on meeting those metrics at the expense of other important tasks.

Overall, incentives and compensation for performance can be powerful tools for motivating employees and improving organizational performance, but they need to be designed and implemented thoughtfully to ensure they are effective and fair (Bob, 2009).

Here are some common types of incentives and compensation used in human resources management to motivate and reward employees:

·

Performance-based bonuses: These are bonuses given to employees who meet or exceed performance targets. They are usually tied to specific goals or metrics, such as sales targets or customer satisfaction ratings.

·         Recognition and awards: This include things like employee of the month awards, certificates of achievement, and public recognition of exceptional performance.

·         Stock options and profit sharing: Some companies offer employees the opportunity to purchase company stock or receive a share of company profits as a form of compensation.

·         Commission-based pay: This is common in sales roles, where employees receive a percentage of the sales they make.

·         Pay raises and promotions: Employees who consistently perform well may be eligible for pay raises or promotions to higher positions within the company.

·         Flexible work arrangements: Some companies offer employees flexible work arrangements, such as telecommuting or flexible schedules, as a form of compensation.

·         Employee benefits: This includes things like health insurance, retirement plans, and paid time off. Offering competitive benefits packages can be a powerful tool for attracting and retaining talented employees.

It's important for human resources managers to carefully consider the types of incentives and compensation they offer, and to ensure that they are aligned with the company's goals and values (Anyebe, 2017). A well-designed incentives and compensation program can help motivate employees to perform at their best, which can ultimately lead to greater success for the company as a whole.

In summary, incentives and compensation are important tools that human resources managers can use to motivate and retain employees. By carefully considering the needs and values of the company and its employees, human resources managers can create a compensation package that is fair, transparent, and effective in driving the company's success.

 

 

References

Anyebe, A., 2017. “Human Resource Management” An expository Approach. Volume 2, pp. 100-109.

Armstrong, M., 2019. A Hand book on Human Resources Management Practices. Compensation and Benefit Review, pp. 34-39.

Bob, N., 2009. Making employees suggestion count. Journal of Personnel Management, pp. 20-25.

Danish, R. &. U. A., 2017. Impact of Reward and Recognition on Job Satisfaction and Motivation. Volume 5, pp. 159-167.

Hewitt, A., 2019. Managing Performance with incentive pay. p. 57 – 60.