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How to Design & Implement a Results-Oriented Variable Pay System

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As asserted by Belcher "traditional approaches to compensation do not meet today's business needs and are failing American industry. As the recognition of failure grows, U.S. companies are rapidly adopting alternative reward systems in an attempt to deal with the challenges of an increasingly competitive marketplace."

What's wrong with this traditional reward system?

According to Belcher :

* tradional reward systems compensate, but do not reward.

* traditional reward systems do not reinforce teamwork.

* traditional reward systems do not support strategic business priorities.

* traditional reward systems are inflexible and are not reflective of business results.

Then, variable/alternative pay system vs. traditional pay/reward system.

Variable pay system is defined by Belcher as an alternative compensation system that ties pay to business outcomes and supports a participative management process. Cash payouts are based on a predetermined measure or measures of group or organizational performance.

This study is highly recommended for HR professionals and line managers.

See also :

* The New Pay-J. Schuster, P. Zingheim

* Strategic Pay-E. Lawler

* Aligning Pay and Results-H. Risher

* Rewards That Drive High Performance-T. Wilson

Its a book that really guides you trough the steps of the design process.