Question

In two detailed paragraphs please explain how will a human resources manager decide whether to use individual employee, work unit/team, organization-wide incentives, or some combination?

Answer 1

The way of doing business has changed a lot from what it was few years back and today in order to sustain and succeed in the field of business, organizations need to be very much successful in their approach and that is possible only when they have a proper plan to compensate the employees based on the performance they display. The Human Resources unit need to plan the type of incentive based on individual employee incentive or team incentive or organization incentives, etc. The HR unit needs to consider certain factors here, like the performance of the organization, performance of business units, performance of accounts and performance of individuals.

The differentiation here will help design the pay system and the HR needs to decide in the priority as well, for example the organization as a whole performs well but there will be certain teams or accounts that may not perform that well, but if incentives are given to them, they will be motivated and may work better in the future. I believe that the incentive pay should be dependent on the type of success and achieved and the pay out will be accordingly as well in order to make it effective and fair.