the two-by-two matrix established by Milkovich and Wigdor (1991). We have reproduced their_ matrix in Figure 4.1 as a frame for the following discussion.
Milkovich and Wigdor categorize the elements of the matrix based on individual versus group level of performance and whether or not the incen¬tive compensation is added to an employee's base salary. The individual or group nature of the plan is important. Performance pay that links indivi-duals rather than groups to work-related goals may be viewed by employees as being easier to accomplish when goals and appraisals are con¬sidered to be fair (Milkovich and Wigdor, 1991). In such plans, at least at the theoretical level, perceived or actual collective action dilemmas become less of a problem for individual emplo¬yees. The way plans are tied to base salary may also have serious repercussions for performance. Lawler (2000) states that plans utilizing bonuses may have a more positive motivational effect on employees, as the reward granting process becomes flexible over time. When pay is tacked on base salaries, the implication is that emplo¬yees may have less to strive for in terms of gain-ing rewards. We introduce the various plans below, noting that some of our discussion comes from literature that primarily analyzes the private sector.
the two-by-two matrix established by Milkovich and Wigdor (1991). We have reproduced their_ matrix in Figure 4.1 as a frame for the following discussion.Milkovich and Wigdor categorize the elements of the matrix based on individual versus group level of performance and whether or not the incen¬tive compensation is added to an employee's base salary. The individual or group nature of the plan is important. Performance pay that links indivi-duals rather than groups to work-related goals may be viewed by employees as being easier to accomplish when goals and appraisals are con¬sidered to be fair (Milkovich and Wigdor, 1991). In such plans, at least at the theoretical level, perceived or actual collective action dilemmas become less of a problem for individual emplo¬yees. The way plans are tied to base salary may also have serious repercussions for performance. Lawler (2000) states that plans utilizing bonuses may have a more positive motivational effect on employees, as the reward granting process becomes flexible over time. When pay is tacked on base salaries, the implication is that emplo¬yees may have less to strive for in terms of gain-ing rewards. We introduce the various plans below, noting that some of our discussion comes from literature that primarily analyzes the private sector.
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the two-by-two matrix established by Milkovich and Wigdor (1991). We have reproduced their_ matrix in Figure 4.1 as a frame for the following discussion.
Milkovich and Wigdor categorize the elements of the matrix based on individual versus group level of performance and whether or not the incen¬tive compensation is added to an employee's base salary. The individual or group nature of the plan is important. Performance pay that links indivi-duals rather than groups to work-related goals may be viewed by employees as being easier to accomplish when goals and appraisals are con¬sidered to be fair (Milkovich and Wigdor, 1991). In such plans, at least at the theoretical level, perceived or actual collective action dilemmas become less of a problem for individual emplo¬yees. The way plans are tied to base salary may also have serious repercussions for performance. Lawler (2000) states that plans utilizing bonuses may have a more positive motivational effect on employees, as the reward granting process becomes flexible over time. When pay is tacked on base salaries, the implication is that emplo¬yees may have less to strive for in terms of gain-ing rewards. We introduce the various plans below, noting that some of our discussion comes from literature that primarily analyzes the private sector.
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