Implementing a pay-for-performance plan can be challenging because it involves changing from an organizational culture of entitlement to one based around performance.
The potential upside of pay-for-performance plans is that they will attract and motivate top talent and better link employee actions to organization goals.
The mix should be monitored and reviewed by management.
A pay-for-performance system will fail quickly if there isn't enough money to pay the rewards that employees are due.
A well-designed pay-for-performance plan will support your organization's mission and appeal to your top performers.
A key element in any pay-for-performance plan is a manager's ability to train employees properly and evaluate them fairly.
Yet, somewhere in this anxiety-inducing process, performance improvement plans, or PIPs, continue to be one of the most powerful tools for managing employee performance. A PIP is the final step in a long process of determining whether an employee is the right fit for your company.
It’s the last chance an employee has to prove that they can do their job.
Just remember—it might not hurt your business that much to keep them on for an additional month of training if you feel like they can really improve.
“You can’t just hold all your feedback in and all of a sudden tell your employee that they’re not doing their job and let them go,” says Katie.