Performance-Related Pay Impact Motivation and essay

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57, why are metrics, i.e. The choice of what to measure, fair simply because one meets or exceeds a goal?

) The sales people seem to repeatedly confuse "metrics" with "goals" (i.e. "targets"). What do you infer from this? Is there anything you need to foolow up on here?

Tutor is mistaken; the Goals are the Metrics under

Consideration here.

"The Impact of Performance-Related Pay

on Motivation and Job Satisfaction of Sales Personnel

in the Computer Industry

with Recommendations to Improve Management Practices"

Case-study of SEMICO INC


Executive Summary

The search for better ways to motivate people in the workplace continues unabated, but the search is becoming increasingly complex as an increasing number of theorists weigh in on what factors tend to affect job performance and employee satisfaction. Although no consensus has been forthcoming, the theoretical work that has emerged concerning employee motivation can be divided into three basic perspectives, the first of which maintains that motivation comes from within and it is not even possible to motivate others, the second of which argues that employees must be motivated by management so managers must possess the requisite people skills for this purpose and a third perspective that combines elements of the first two views. In reality, though, pay continues to rank at the top of virtually all lists of what factors motivate employees and increase their sense of job satisfaction. Therefore, the topic selected for this study concerned the impact that incentive pay has on employee motivation and job satisfaction, two constructs that have been shown to be directly related to an organization's performance, productivity and profitability. In reality, it just makes good business sense that highly motivated employees who are satisfied with their jobs will be more productive workers who are also more committed to the organization and its goals. Employees who are more committed to an organization are also less likely to move on to greener employment pastures elsewhere as soon as the economic winds shift direction, after they have gained valuable experience and expensive training that has been provided by their current employer. There are some important considerations involved in the implementation and administration of any type of incentive pay program, though, that must be taken into account in order to ensure that the benefits of such initiatives are not outweighed by some of the constraints that have been shown to adversely affect the effectiveness of performance-related pay programs. The general research question that guided the study was, "Does performance-related pay impact motivation and job satisfaction of sales personnel?" To answer this research question, the study established the objectives to:

a) identify what metrics are commonly used by the companies competing in the computer industry to measure sales people's performance today and how such metrics used to formulate pay for performance amounts;

b) determine whether the metrics used to calculate performance pay are regarded as fair by sales people/teams;

c) determine whether people are motivated by the metrics used to formulate pay for performance amounts and the way they are used;

d) establish a set of recommendations for implementing and sustaining a performance-related pay program as part of a wider performance management system.

To accomplish these objectives, the study used both primary research consisting of a qualitative case study analysis of the results of focus groups and face-to-face interviews with European and United States-based employees and executives competing in the computer industry as well as secondary research consisting of a critical review of the relevant peer-reviewed, scholarly and organizational literature concerning the impact that performance-related pay programs can have on employee motivation and job satisfaction.

Table of Contents



Executive Summary


List of Figures



Chapter 1: Introduction


Background and Reason for Topic


Significance of Topic


Scope and Main Content of Area


Research Approach


Chapter 2: Aims and Objectives


Contextual Issues


Report Structure


Organizational Case Background


External Organizations Selected for the Research


Terms of Reference


Chapter 3: Literature Review


Motivation Theories


Reward Theories


Performance Measurement Theories and Approaches


Performance Related Pay (PRP)


Job Satisfaction


Chapter Summary


Chapter 4: Research Methodology and Fieldwork




Guiding Research Questions


Rationale in Support of Interview Structure


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