10:  Pay for Performance:  Incentive Rewards

 

Look at Figure 10.1 at all the types of incentives

 

Do incentive plans work?

 

Advantages of Incentive Pay? (Figure 10.2)

 

What are the requirements for a successful incentive plan?

 

A.  Setting Performance Standards

                Why is measurement the key to success?

 

               

                What are the keys to setting performance measures?

 

 

 

B.  Administering Incentive Plans

                What are three important points?

                                1

 

                                2

 

                                3

 

C.  Individual Incentive Plans

                1.  Piecework:  What are the types, how do they work and why do it?

 

 

                                A.  Computing the Piece Rate

 

 

                                B.  The Drawbacks

 

 

                2.  Standard Hour Plan:  Why use this and how does it work?

 

 

 

                3.  Bonuses:  explain bonus systems and what is a spot bonus?

 

 

 

                4.  Merit pay:  why provide merit pay and what are some keys to success?

 

 

                                Problems?

 

 

 

                                Explain the Merit Pay Guidelines Chart (HRM 3)

 

 

                5.  Lump-Sum Merit Pay:  how is this different and what are the advantages?

 

 

                6.  Sales Incentives: 

                                Unique needs of sales incentive plans

 

 

                                What are some types of sales incentive plans?

 

 

 

                7.  Incentives for Professional Employees?  How can this be done?

 

 

 

 

                8.  Executive Compensation (How is this different?)

 

                                Executive Pay Package

               

 

                                                Bases for compensation

 

 

 

                                                Short term incentives?

 

 

 

 

                                                Long term incentives?  Figure 10.3?

 

 

 

 

                                                Perks

 

 

D.  Group Incentives

                1. Team Compensation:  What is it and what are the pros and cons?

 

 

               

                2. Gain Sharing:  What is the purpose and how do they work?

 

 

                                The Scanlon plan

 

 

                                The Rucker Plan

 

 

                                Improshare

 

 

                                Earnings-at-Risk

 

 

E.  Enterprise Incentive Plans (Explain each and provide advantages/disadvantages).

                1.  Profit-Sharing Plans

 

 

                2  Stock Options

 

 

                3.  ESOPs