Wednesday, January 25, 2012

how can the reward system be improved

Just a passing thought on how to encourage the employees to be top performers

General practice in companies is to set targets at the beginning of the financial year ,conduct mid and final reviews(only time managers share the negative feedback) and group employees according to relative ratings .We also see that some where between the year most employees settle for average ratings (where most fall) and perform accordingly . But is it what the company looking for ??
so what i think is that instead of rating the employees at the year end , give each and every one of them top ratings (say 100 points ) in the beginning of the year . Now cut the points to the employees when ever employee is showing a deviant behavior and let the employee know about it (this solves one problem in conducting performance appraisals as most cases managers do not share negative feedback except in the final appraisal meeting). In this way every employee starts with 100 points and at the end ,based on relative ratings (who is able to retain the max score) would be getting the top rewards

Some important considerations are :
(1)there is a possibility that once employee falls below a certain rating compared to his colleagues , he may start loosing points more often putting less efforts as he feels he already lost his chance and worse may not be supporting the others in hope that they would also loose the points hence dragging the performance of every one down
This i feel can be resolved ,by having lee way in the system where in if the employee puts in efforts over and above what is required , option should be there to get extra points . so in this way , the employee can reach to the position from where he slid down

(2)If implemented in a team based scenario, the point system should be applied to the team as a whole instead of individuals

(3)The expectations or outcomes of the job and standards against which they are measured should be made very clear

(4) Every cut in the rating should be explained to the employee and there should be a proper grievance mechanism to address the concerns

As i mentioned this is just a passing thought and i felt its worth putting in words

1 comment:

  1. i am new though to HR Functions ... Still in a Que to get into B School .. but based on my Experience ....

    We have implemented such System in our Plant
    the Parameter we considered was :
    1. Ownership to Machine
    2. Production As per Product variance
    3. Rewards point Supplement through 3 different department as a team :
    production :- for achievemnt of target
    quality :- Operator Fault Rejection
    maintenance :- Machine Cleaness ..
    4. Attendance :- at the machine ..that includes
    starting and running tym ( Excluding breakdown Time )


    And as u have said the same way we collect data for month and publish the top 5 operators ... top team and top employee

    And publish on the LCD ... all this system is SCADA based ... though the Iniatial cost was huge ...

    but yeschh it have many advantage .. and company like Johnson & johnson can bear it :)


    Thanks
    AShish Patial
    ............
    Hopefully i will Convert TISS :)

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