REWARDING PERFORMANCE
US compensation managers hope to expand use of variable pay
The New York-based Institute of Management & Administration has just published the findings of its latest pay for performance strategies survey . The research provides a valuable insight into the issues at the top of the reward agenda across corporate America.
As part of the study published in a recent edition of Pay for Performance Report, IOMA asked employers to set out a wish list of how they would like to overhaul their company's compensation arrangements:
If you could change anything about your organisation's compensation system, what would it be?
Replies were received from 164 HR and compensation managers. Variable pay programmes emerged as the leading contenders for change.
Here are the five most commonly-mentioned changes US managers would make, ranked in order of popularity:
1. Introduce — or expand the use of — variable pay programmes — pay-at-risk plans were mentioned more frequently than any other by the small sample of organisations which cited a specific variable programme, followed by competency-based, profit-sharing and key contributor pay programmes.
2. Improve performance management systems — but there was little consensus on what form this should take.
3. Strengthen line-of-sight — compensation programmes need to have a more direct link to performance.
4. Fix base pay programme — all too many base pay programmes provided a shaky foundation for new, improved variable pay programmes.
5. Alter timing/frequency of rewards — typically to increase the frequency of pay-outs for existing pans.
Want to now more?
Title: IOMA's Pay for Performance Report, November 1999.
Post: Institute of Management & Administration, 29 West 35th Street, 4th floor, New York NY 10001-2299, USA.
Tel: 001 413 529 2406
Fax: 001 413 529 2507
email: podolske@valinet.com
website: www.ioma.com