Compensation Systems




Last year, you were tasked with deploying an employment engagement survey. While there are areas where the company is
excelling, there is an opportunity to address merit pay concerns. It seems employees who are high performers feel there is
very little differentiation in pay increases for those whose performance exceeds or far exceeds expectations. To further this
concern, exit interviews indicate many employees are leaving the organization for higher paying positions with major

You have been asked to develop the pay for performance philosophy for the organization and integrate it into the performance
management process. Describe pay for performance and discuss how you can infuse a pay for performance culture within the

How would this new culture impact the organization?

StopNShopToday, Inc. has had difficulty motivating and retaining key cashiers and wants to provide an incentive to them that
will generate improvement in several critical areas of store cashier performance, which include the following:

Increasing total sales revenue

Reducing inventory losses and theft

Improving overall customer service and satisfaction

Improving store cleanliness and housekeeping

Improving attendance and reducing unscheduled absences

Several stores have poor overall sales volume and ongoing chaos because ofthe stafftaking unscheduled absences. Others
have issues with inventory and theft. All the stores want to address cleanliness and customer satisfaction problems.
Overall, officials with the company feel they can commit no more than an additional $200 per employee per year as an
individual incentive and no more than $500 per year for the same store or corporate incentives.

You will select one ofthe critical areas of store cashier performance improvement (listed above), and recommend three
components to be included in an individual incentive program for the cashiers. Use information from the Internet research you
have done to aid in your understanding of cashiers’ tasks and work values. Tie your ideas to a contemporary motivational

Discuss how you might incorporate the ideas you have generated regarding individual incentives.

Next, discuss store- or corporation-wide incentives.

Generate a recommendation for 2 possible avenues of same-store incentives and 2 possible avenues for corporation-wide


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