SalaryReviewGuidelinesGuidelinesonthedistributionofincrementsanattempttoovercomethevaryingstandardsofjudgmentleadingtoan‘allmyducksareswans’approachtorewardingstaff.Thedistributionscalemayberelatedtoaguidelinelikethis:AssessmentIncrement(%)DistributionA–outstanding9%–10%10%B–good7%–8%20%C–satisfactory4%–6%50%D–needsimprovement0%10%E–unsatisfactory0%10%SalaryReviewGuidelinesGuidelinesonratesofprogressionmanagersarehelpedtoplansalaryprogressionbybeinggivenanindicationofthenumberofyearsitshouldtakestaffatdifferentlevelsofperformancetoreachthetopofthegradeand,inzonesofsalaryrange,thelimitswithintherangewhichcanbereachaccordingtotheirperformance.AssessmentLimitInGradeTypicalLengthLearningzone1to3years2yearsPerformingzone4to6years5yearsExceedingzone2to4years3years-SalaryProblemsAbsorbingmarketratespressuresariseswhengeneralandindividualsalaryreviewshavenotenabledthecompany’ssalarylevelstokeeppacewithincreaseinmarketrates.itisexacerbatedifthecompanyisexpandingandiscompelledtoobtainkeystaffwhoareinshortsupply.Wideningdifferentialsdifferentialsarewideningbetweenandwithincompaniesinthefollowingareas:-betweenhigh-andlow-payingorganizations–thevariationsinprosperitybetweendifferingsectorsofindustryandcommerceandbetweenregionsaremajorcontributorstothisproblems.-betweencompaniespayingbonusesorincentivesandthosepayingstraightsalaries.SalaryProblems-betweentopandmiddlemanagementwithincompanies–thisispartlyincentiveled-betweenexecutivesrecruitedbysearchandthosewithaone-companycareer.Performancepaytendtofavourthefewwhoseresultscanbemeasured.merit-assessmentaretoooftenbasedonsubjectiveandbiasedjudgments.canbeavoidedonlybyintensivetrainingofassessorsandbycarefulmonitoringoftheappraisalscheme.SalaryProblemsStaffreachingthetopoftheirsalaryleaguestaffreachingthetopoftheirsalaryrangemayfeeldemotivatediftherearenoprospectsforpromotionitispossibletodealwiththisproblembyintroducingontopofthenormalsalaryrangeapremiumzonewhichisreservedforoutstandingstaffwhosepromotionisblocked.Startingsalariestheproblemofstartingnewstaffathigherratesthanexistingemployeesshouldbeminimizedifinternalsalarylevelsareregularlyreviewedincomparisonwithmarketrates.SalaryProblemsDeterioratingjobevaluationschemestheschememaynothavebeencontrolledproperly,sothatgradedriftoccursthroughunjustifiableupgradings.schememayhavelostcredibilitybecauseitnolongergivesacceptablesolutions.administrationmayhavebecomesobureaucraticthatthetimetakentoproduceanswersisundulyprolonged.thesolutionistomakeadeterminedefforttotightencontrolsandspeedupadministration,makingonlyminormodificationstothescheme.ObjectivesofPerformance-RelatedPay(PRP)Motivateallemployees,notjustthehigh-flyers.Increasethecommitmentofemployeesbyencouragingthemtoidentifywithitsmissionandvalues.Reinforceexistingculturesandvaluestofosterhighlevelsofperformance,innovationandteamwork.Helptochangecultureswheretheyneedtobecomemoreperformance-orientedandresults-oriented;orwheretheadoptionofothernewandkeyvaluesshouldberewarded.Discriminateconsistentlyandbeequitableonthedistributionofrewardstoemployeesaccordingtotheirperformanceresultsandcontributions.ObjectivesofPerformance-RelatedPay(PRP)Deliverapositivemessageaboutperformanceexpectationsofthecompany–focusesattentiononkeyperformanceissues.Directattentionandendeavourbyspecifyingtheorganization’sperformancegoalsandstandards.Emphasizeindividualperformanceorteamworkasappropriate.Improvetherecruitmentandretentionofhigh-qualitystaff.PRPcostswillbeinlinewithcompanyperformance.KeyFactorstoConsiderWhenIntroducingPRPMatchingtheculturesuccessfulPRPschemesneedtomatchthecultureandcorevaluesoftheorganization.LinkingPRPtobusinessstrategythefocusneedstobeonstrategicbusinessissueswhichemergefromthebusinessplanningprocess.BalancingquantitativeandqualitativemeasureswhilemostPRPschemesrelyonquantitativemeasuresofperformance,qualitativefactorsneedtobeintroducedforthemeasurementofindividualbehaviouregbalancedscorecardsTheneedforflexibilityflexibilityinmaking‘milestone’paymentswhichconveytherightmessagesforthefuture.Theneedtopromoteteamworktheimportanceofteamworkshouldberecognizedinstructuringtheschemeanddefiningcriticalsuccessfactorsandperformanceindicators.KeyFactorstoConsiderWhenIntroducingPRPTheneedtoavoidshort-termthinkingsettinglong-termaswellasshort-termgoals,anddiscussingshort-termobjectivesintheiroverallcontext.InvolvementinthedesignprocessdesigningPRPschemesshouldbeaniterativeprocess:tryingandtestingideasonmeasuresandstructureswiththosewhowilleventuallybeinvolvedinascheme.GettingthemessageacrossalltypesofPRPareverypowerfulformsofcommunication.Togettherightmessagesacrossforanyscheme,onemustmakekeydecisionsonthefollowing:Howcantheschemeachievethebestpossiblelaunch?Isitbettertogivenopay-outratherthanalowpay-out?Whatisthebestpsychologicalmomentforpay-out?Whatcommunicationsshouldbeusedtogainmaximummotivationalimpactfrompayment?Howshouldcommunicationsbehandledwhentheschemerequireschanges?CompetencebandsExcellentGoodSatisfactoryPerformanceLevelsPe