Employee performance plays a vital role if an organization is to realize success in attaining its goals. One of the key indicators of the general performance of the company is the performance of individual and groups within an organization. This process hints at the ability of a firm to accomplish its goals. Based on this understanding, most businesses optimize their employees’ compensation programs to help them boost the performance of individual staff members as a means towards achieving organizational goals (Poister, Hall & Aristigueta, 2015). The paper discusses a number of options that can be used to link individual and group performance with organizational goals and the performance measurement programs.
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Tying Performance to Organizational Goals
The concept of tying performance with organizational goals is grounded on that individual and group performance has a direct relationship with the ability to attain organizational goals. The notion is embodied in the fact that individual goals are either directly or indirectly associated with organizational goals. Therefore, input by individual employees and their performance determine the possibility of attaining organizational goals that makes an organization successful (Poister et al., 2015).
Individual and Group-Level Performance Measurement
When measuring individual and group performance, an organization uses different types of performance measurement. The metrics can enable an organization to identify the performance at individual and group levels. One of the most effective tools that an enterprise can use is the Balanced Scorecard (BSC). The BSC is extensively applied in business to provide managers a comprehensive view of the performance of their organizations. This instrument can help managers understand the performance both at the individual and group level (Poister et al., 2015).
Advantages and Disadvantages of Individual Versus Group-Level Performance Recognition
Individual performance recognition is advantageous since it is effective with relation recognition to the performance of an individual that could be implemented in form of payment. Apart from that, this approach enables an organization to retain high performance (Tsui & Lai, 2009). As such, the recognition helps a company to cut the expenses that are incurred when the rate of employee turnover is very high. Such a perspective also enables an organization to effectively compete with its rivals. Moreover, individual recognition helps an enterprise to giveequitable distribution of compensation. In addition, an individualized compensation, when used as a way of recognizing individual performance, is effective in ensuring individual employee motivation. Tsui and Lai (2009) add that this option is suitable for individualistic culture.
However, despite its advantages, individual performance recognition has its shortcomings. For instance, the factors that are not rewarded can be overlooked. There are also possibilities that with the recognition, the aspects that are not in the control of the employee can influence the outcomes of their productivity. Performance recognition is either time-consuming since an organization has to establish the performance standards of individual employees. Another disadvantage is the possibility of unrealistic standards that will hamper motivation of employees. It happens in the case where employees feel that the standards that are set for them are not in line with their level of productivity. Besides, individual performance recognition can lead to mistrust between workers and the management (Tsui & Lai, 2009).
Group-level performance recognition also has its advantages and disadvantages.First, improving organizational performance is among its benefits. When the performance of a group is recognized, the group is motivated to work extra hard so as to achieve their objectives in future assignments. In so doing, groups within an organization increase their productivity. The end result is an improved performance of the company. Second, group-level recognition is based on organizational measures. Moreover, the recognition can be periodically measured. Despite the advantages, the recognition may be unacceptable to high-level individual performers. Recognition is also a lessening line of sight and can increase the risk to compensation as a result of lack of stability (Tsui & Lai, 2009).
The Options that an Organization has to Link Individual or Group Monetary Rewards to Organizational success
Organizations currently initiate innovative reward systems to motivate their employees to perform their duties productively (Tsui & Lai, 2009). This is due to a perception that employee motivation through monetary rewards impacts on the organization’s performance hence influences the chances that a company will succeed. Improper reward practices can lead to below-average organizational performance. Reward systems have different levels of effectiveness in impacting employees’ performance. Therefore, it is advisable for organizations to adopt innovative compensation strategies that are linked directly to employee motivation so as to improve organization’s performance. To achieve this goal, businesses integrated the rewards with their system of performance definition and measurement. Organizations can also replace traditional employee incentives in accordance with their position and long-term experience. They are replaced with individual and group-team based rewards, such as profit sharing, stock option plans, and gain sharing, to list a few.
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