Managing Employee Performance.
Challenges and Ambiguities of Managing Employee Performance by Pay Rewards
Challenges and ambiguities of managing employees by performance-related pay
Managing employee performance can sometimes be a tricky affair as not all approaches work well with some employees. When managing employees, sometimes the top management may decide to adopt the performance-related pay as their key mode. In as much as this method may have its advantages, it does bring forth a number of challenges and ambiguities in equal measure(Cardona, 2007). This paper critically discusses these issues as far as the management of employees is concerned.
Cardona (2007) states that rewarding employees by means of pay may increase employee enthusiasm andretain competent employees while enhancing their overall productivity. When an organization manages employees through pay related rewards, the employees feel better motivated to continue working for the company hence better relations between the employees and the management. More employees that did not receive a pay reward may feel inspired to increase the quality and quantity of their productivity that in turn, favors the general management profile of the concerned organization (Cardona, 2007).
Nonetheless, a number of challenges and ambiguities surface when it comes to the management of employees through individual performance-related pay.First, this approach strains the management in terms of financial planning in that it intensifies the performance ratings. Increase in personnel costs may prove to be a delicate matter to the organization especially when it results from financial rewards to employees(Cardona, 2007).Another bottleneck to this approach is the absence of objectivity in performance evaluation. For this reason, the performance appraisal may be prone to judgmental errors due to the component of subjectivity. According to Cardona (2007), this aspect of subjective judgment may demoralize some employees who may be suspecting deliberate bias in rewarding concerned employees.
Lastly, there is need to financially reward all employees within a given organization as not only the high performing employees are responsible for the organization’s survival and thriving but all employees working as a team. Therefore initiating a pay-related reward relative to performance may be tantamount to discriminatory workplace behavior, which may taint the company’s image (Cardona, 2007).
Cardona, F. (2007).Performance Related Pay in the Public Service in OECD and EU Member States. Retrieved from http://www.oecd.org/countries/romania/38651281.pdf