Solution
Robert answered on
Dec 26 2021
Accounting 1
Performance based Incentives
Accounting
Accounting 2
Introduction
It is necessary in today’s world to constantly update oneself with the latest information
and skills to keep ahead and be successful. Most organizations that employ a large number of
personnel have to put into place systems of appraisals which are all aimed at monitoring as well
as keeping the work force constantly on its toes (Drucker, 2008). The owners, managers and
Human Resource departments of corporate the world over are trying their best firstly, to get the
est skilled personnel. Once these people are in place, the organization becomes responsible for
getting them to perform to their optimum talents. This performance monitoring and evaluation
has been done through a number of tools. These tools are, therefore, also called ‘Performance
Appraisals’ which the organization has to constantly set into place to ensure that each employee
gives to the team effort the maximum he or she can according to their specific skill sets.
The performance appraisals are also reliable indicators for charting the promotion and
incentives schedules of the organization, but more on that can be discussed only after the
creation of these ‘Appraisals’ has been formally developed, designed and concretized.
Performance Appraisals
Each employee is given a job profile when he or she joins any industrial, services or
corporate set up. This job profile gives clear details of the skills set employed to give the best
performance and output. The measure of an individual’s performance is both easy and difficult to
assess because of the tangible and intangible components that are an intrinsic part of it. A
number of parameters go into ascertaining the quality and level of performance of an individual
and the teams to which they belong as regular members (Ulrich, & Brockbank, 2005). This is
ecause most corporate offices are working on team effort and depend largely on team spirit.
There are different rules of measuring the overall effort of the team and the individual. Goals and
the attainment of specific sequential steps in the course of a specific job are markers that exhibit
oth individual and team effort. How much each person puts in can also be measured on a
Performance Appraisal Scale which has been custom made and designed specially to cover all
aspects of the corporate overall performance. For example, in a travel agency, the overall output
may be the number of bookings done and the total revenue generated.
Accounting 3
In the case of a hospital or any similar services oriented industry, the numbers would be a
common dominator while the overall revenue generated would no doubt be a good equalizer.
The yardstick of measurement is when the intangible indicators like team spirit and initiative
take on highly specific meanings (Ulrich, & Brockbank, 2005). When any team moves forward on
its merits and that effort is further accentuated with that extra little bit which defies definition,
the measure of its performance is not only the goal achieved, but also the manner in which it has
een achieved. The real test of the team’s strength is how slow or weak is its least performing
member and how best can that particular member’s output be upgraded, supported and
accentuated for the best and optimum performance.
Performance: Reward & Censure
The performance of an individual is appraised for the purpose of understanding whether
he or she is actually pulling their weight or not. Secondly, it is also a tool for ascertaining how
those who have been performing very well should be encouraged to do even better.
The performance, its level and quality would determine whether the individual should be
given any incentive. The performance would also determine what form the incentive would take
an increment, some perks or extra benefits or even a sizeable engorgement sign like a promotion
or a privileged, placement. The flipside of the coin, nevertheless is that in case the performance
is not good enough and the person is consistently lagging behind then what measures would be
affected to ensure that the person begin performing better. However, if the individual is
consistently performing badly then drastic steps have to be taken to safeguard to output levels
attained and achievable by the entire teams.
The negative part of appraisals can prove to be quite demoralizing for everybody. Having
to reduce perks and privileges or having to cut off certain benefits is bad for company morale.
Yet, to maintain a level of optimum output, the person is given several chances to redeem their
output. The worst case scenario is when a person has to be told to leave the organization,
especially when he or she continuously sticks to being...