Chapter 11 outlines two philosophies; entitlement and performance. To motivate employees toward organizational goals, leaders need to establish a guiding philosophy regarding total rewards system and communication of it.
Research compensation philosophies of entitlement versus performance. Find an article or research study of one of these philosophies or both that outlines if the philosophy is working well or not working well. Discussing the communicating pay philosophy is also a consideration.
Please remember to share the URL (link) of your article or research study.
Discussion Board Directions:
- You will not be able to view your classmate’s posts until you post.
- Your initial post should be 2-3 paragraphs in length.
- Your initial post is due by Thursday. This allows you and your classmates time to read and reply.
- Make sure to demonstrate critical thinking and analysis by using research and personal work experiences.
- For full credit, you are required to respond to a minimum of two classmates. Please begin your reply by addressing the student by name. Your responses must be completed by Sunday at midnight.
- Please refer to the rubric for the grading requirements. You can view the rubric by clicking on the wheel in the upper right corner and selecting “show rubric.”
According to Mathis, et. al. (2020), the pay-for-performance philosophy assumes that compensation decisions reflect performances differences; therefore, pay raises or incentives are structured to reward quantity, quality, speed of work, and customer satisfaction among employees. By doing so, employees are motivated and direct their efforts towards organizational objectives in order to meet performance goals. The performance philosophy includes pay and raises based on performance, no raises for poor-performing employees, market-adjust pay scales, no raises for length of service or job tenure, and industry comparisons of total rewards (Mathis, et. al., 2020). This type of reward system is not typically used exclusively; however, if it is used alone it should reflect important outcomes to shareholders, customers, and employees.
Neeraja and Aman (2009) state that in most organizations today, performance appraisal and designing reward system has become a core area of attention for managing human resources to stimulate them to perform efficiently. In a study on the effect of performance pressure on stress appraisals, self-regulation, and behavior, both functional and dysfunctional outcomes are produced (Mitchell, et. al., 2019). Although performance appraisals may be an effective way to motivate employees, it can come with some consequences, including a significant source of stress for employees. The study showed that a focus on the negative aspects of performance pressure (difficulties of improving performance) prompts threat appraisals, which creates a taxing experience that depletes self-regulation and leaves these employees less able to control their behavior with social etiquette (leads them to act uncivilly), and a focus on the positive aspects of performance pressure (opportunities) prompts challenge appraisals, which engages a positive, self-reinforcing effect on self-regulation through engagement that promotes functional work behaviors (task proficiency, citizenship) (Mitchell, et. al., 2019). Organizations that implement performance philosophies must be careful not to exert too much pressure and stress on their employees, or else it may result in a negative outcome for the organization.