person focus to pay
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Person Focus to PayTRANSCRIPT
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Dr. G C Mohanta, BE(Mech), MSc(Engg), MBA, PhD(Mgt)
Professor
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Pay-for-Knowledge◦ Competency Based Pay◦ Skill Based Pay
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Fredrick Taylor in Scientific Management focused on the basic elements of the job
Lead to job focused way of organizing work
Criticisms of job based structure◦ Reduces flexibility◦ “Not my job”◦ Little reason to acquire information & skills
outside of narrow job◦ Doesn’t help people understand what other
people do
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Pay is tied to skills, abilities & knowledge that a worker possesses
Manufacturing jobs Flexibility to reassign people to where work
is needed Depth: pay for having a deep level of
knowledge within a job e.g. teachers pay increases with amount of
education: bachelors, masters, doctorate degree
Breadth: Pay for generalist knowledge
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Increased pay for more knowledge Pay increases come with certification of
new skill◦ (e.g., Microsoft certification; SHRM Certification)◦ Skill certification can come from internal assessment
Employees then can be assigned to new jobs based upon certification
Pay increases with the more certifications held For example: 7.50 base pay + 1.00/hr for each
machine
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Ensures workers have needed skills◦ Assumes good tests
Supports the organizational work flow◦ Workers trained & ready to move to assignments as
needed Fairness
◦ Depends on how training conducted◦ Who pays for training◦ Means two people doing same task at different pays
Motivation◦ Motivation is to get training, not necessarily to perform
task well
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Employees accept skill based pay◦ Certification procedures must be viewed as fair
Easy to communicate Productivity
◦ Mixed results 61% of those implementing SBP were using
it 7 years later Depends on strategy more compatible with
innovation not low cost Usefulness varies based upon setting
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What are competencies?◦ Skill /expertise that can be learned & developed◦ Knowledge (accumulated information)◦ Self concept (attitudes, values, self image)◦ Traits (general disposition to behave in a certain
way)◦ Motives (thoughts that drive behavior)
Competencies - characteristics of the person: personality, attitudes, knowledge, skills & behaviours
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Knowledge & Skills: Essential characteristics for the job◦ Can be tested: Observable and Measurable
Self concepts, traits, & motivesNot Directly Measurable must be inferred from
actions◦ Self concept (identifies with the team)◦ Trait (flexibility)◦ Motive (drive to produce results)
Much more parameters subjectively assessed
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Derived from mission statement: values & attitudes
JetBlue embraces five values that represent the company and create its unique culture:◦Safety, Caring, Integrity, Fun and Passion
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Organization Strategy◦ Competencies are likely to fit with organization’s
strategy Work Flow
◦ Competencies are designed to convey values and enhance work flow
◦ Effectiveness likely to depend upon culture Fair to Employees
◦ Empower employees to take charge of own development
◦ Subjective Motivation towards organization’s objectives
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How do you certify that someone has these competencies
How to tie to pay How to justify in a
court of law
Level Phase Title
4 Expert Visionary
3 Advanced Coach
2 Resource Contributor
1 Proficient Associate
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Employee Advantages◦ Skill Variety◦ Task Variety◦ Autonomy◦ Feedback
Employer Advantages◦ Communicates Culture◦ Product or Service qualities◦ Leaner Staffing cross usage◦ Flexibility
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Increases training, hourly labour & overhead costs can rise
May not fit with other incentive programs
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Pay for Knowledge programs have the potential to help employers compete in global environment
Must give employees the opportunity to learn