Innovative Compensation

             Innovative Compensation Plans Motivate Employees of Three Small Firms
             This case study illustrates how three small companies tie their respective incentive plans into the employees performance and the companies performance overall. The three companies are Rogan, a plastic knob business in Northbrook, IL, Aspect Communications in San Jose, CA a manufacturer of communications equipment, and Calvert Group in Bethesda, Maryland a financial-management company. All three have similar plans, but also different in many respects. Rogan ties their incentives to employee ideas that save the company money. This gives the employee's added responsibilities and added money when the company saves from their ideas. Aspect Communication uses customer service and customer satisfaction as the basis for their incentive program. These two key points give the employees of this company long-term commitment to the customer and also the company. Calvert's incentive is centered on outstanding performers and regular company distributions. Additionally Calvert reimburses employees for walking to work recognizing the cost savings of walking over driving.
             1. Explain how concepts of organizational justice may be used to explain the success of the incentive programs described here.
             Answer: Organizational justice is the motivations from the perspective of the social comparisons people make, how they compare themselves with others. With Rogan, the input equals the output. Give a cost saving idea and the company will reward you with an incentive. This applies to all employees equally. With Aspect's customer service based incentive plan all employees are rewarded when the customers are satisfied. This is equally shared between all 400 employees. At Calvert, the bonuses are distributed to the outstanding performers, thus more input results in more output in the shape of monetary bonuses. All three incentive plans are b
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