• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
  6. 6
  7. 7
  8. 8
  9. 9
  10. 10
  11. 11
  12. 12
  13. 13
  14. 14
  15. 15
  16. 16
  17. 17
  18. 18
  19. 19
  20. 20
  21. 21
  22. 22
  23. 23
  24. 24
  25. 25
  26. 26
  27. 27
  28. 28
  29. 29
  30. 30
  31. 31
  32. 32
  33. 33
  34. 34
  35. 35
  36. 36
  37. 37
  38. 38
  39. 39
  40. 40
  41. 41

Study and compare the wage incentive schemes prevalent in the service sector.

Extracts from this document...


Objectives of this study To study and compare the wage incentive schemes prevalent in the service sector. Plan of work This project essentially consisted of two parts : The first was a literature review where we observed the existing studies on compensation plans, wage incentives, their relevance and the problems faced. The second consisted of interviewing employees of different firms in the major service industries in India to disseminate particulars of the incentive schemes offered in the respective organisations. This report is the culmination of our findings and learnings. Herein we showcase the data provided and also give our inferences regarding these. Literature Review Compensation by Milkovich, George T ; Newman, Jerry M is largely based on the concept of equity. This book illustrates various pay models in which equity takes on many and varied forms. Different sections of the book take up a different component of equity (Internal, External and Employee Equity) and discusses the major compensation issues requiring resolution. It also covers employee benefits and the administrative issues in compensation. Compensation Management by Henderson, Richard I is divided into three parts. Part 1 provides a big picture review of compensation management and the reward system of an organisation. Part 2 contains a micro-analysis of compensation in organisations. I describes how job requirements are identified, defined, valued and ultimately integrated into a pay system. Part 3 combines the above two and explains how a base pay program is expanded into a total compensation system that includes various short and long term incentives. Financial Incentives by Currie, RM is a general introductory work for students and for those embarking for the first time on the application of work study in a firm or other undertaking. Types of schemes described in this book have the practical endorsement of progressive trade unionists. A connection between this work and its reward is established here. Paying for contribution by Brown, Duncan ; Armstrong, Michael - This book examines and provides solutions to some of the perennial problems of performance related pay. ...read more.


2. All orders dated for the quarter and received at H.O. latest by 3rd of the first month of the next quarter will be treated as order booking for the quarter subject to order acceptance by H.O. Normally order will be accepted by H.O. if: (i) Order is received with minimum of 25% of equipment price as advance. OR Formal P.0 is received from Govt. Organizations / departments or PSU'S. AND (ii) Other commercial terms and conditions are as per our standard norms. AND (iii) No technical over commitments are made. 3. Order value will include: (i) Equipment price (ii) One time charges (iii) First year fixed recurring charges payable annually in advance. 4. Quarterly order booking incentive will be as follows as percentages of order booking value in staircase manner. (Percentages indicated are applicable on the amount in that slab). TARGET ACHIEVEMENT SLAB 120 LACS x N 90 LACS x N Up to 50% 0% 0% Between 50% and 100% 1.0% / N 0.4 % / N More than 100% 1.2% / N 0.6% / N Achievements vs. Incentive payable for few specific quarterly (achievement) value are given below: TARGETS ACHIEVEMENTS 120 LACS 90 LACS 45 LACS 0 K 0 K 60 LACS 0 K 6 K 70 LACS 10 K 10 K 90 LACS 30 K 18 K 120 LACS 60 K 36 K 150 LACS 96 K 54 K 200 LACS 156 K 84 K 6. Incentive amount will be paid along with salary of the first month of next quarter after adjustment of amount for order cancellation (if any) for which incentive was paid earlier. 7. Incentive earned by all sales staff (Account Managers / RM's) will be split as follows: ( (i) 75% of Incentive Paid to the sales staff (ii) 15% of Incentive Accumulated in Regional Fund (iii) 1 0% of Incentive Accumulated in National Fund. 8. Amounts accumulated in Regional and National Funds will be apportioned to Pre-sales support staff as follows: (i) ...read more.


* The risk of accidents may be increased. * Inaccurate rate setting under an incentive scheme or wide differences in the ability or capacity of workers working in close proximity may lead to large differences in earnings and ill-feelings between the workers. * Additional expense involved in employing the personnel required installing and administering a system of payment of results; in some cases this expense might be out of proportion to the potential savings in costs. * Workers may tend to oppose the introduction of new machinery or methods, or other changes in conditions of production, which would necessitate a restudy of the job. Source: Pinhas Schwinger, Wage Incentive Systems (New York: Halsted, 1975). Challenges, Problems and Issues Involved with Wage Incentive Plans: * What incentive should be offered to encourage higher productivity ? * Can non-financial rewards encourage desired performance ? If leadership style shifts towards praise and recognition for superior performance, will the reward be adequate in the long run if profits increase ? * How will productivity and quality be measured ? * Will cooperation and productive relationships among workers and groups be threatened by reward system * How will traditional pay differential between supervisors and employees be affected if employees can earn extra pay for producing more ? * Is there sufficient trust between management and workers to implement an incentive system ? Will the plan be viewed positively by employees, or will they perceive it as a pressure to work harder without a corresponding increase in compensation ? * If not monitored carefully, it slips into an annual increment exercise. * Criteria need to be restructured every couple of years. * Schemes must be transparent enough. * It should be merged with the annual increment exercise. * Avoid nominal incentives. * It should have scope for review. * It should not generate suspicion among workers. * It should not be used as a compensation for low wages. A GOOD INCENTIVE PLAN MUST PROTECT ORGANIZATIONAL INTERESTS. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our GCSE People in Business section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related GCSE People in Business essays

  1. Marked by a teacher

    Sainsbury's organizational structure.

    5 star(s)

    that the staff would be doing their normal jobs and be able to use the new equipment (tills for example) and not hold customers up, and cause a queue due to the staff not being able to know how to use the till.

  2. Customer service Tesco's customer expectations

    Tesco have a market share of 30.5% which is currently the highest supermarket market share in the UK so I'll say Tesco has meet its aims and objectives by improving customer service and providing cheap products at good quality. Tesco customers believe that Tesco have a wide range of products.

  1. Case Analysis: Peter Browning and Continental White Cap

    Browning saw the entire department and its management team to be a huge weakness for White Cap along with weaknesses he uncovered in other departments. This lead to Browning's issues with members of the management team that reported to him such as Jim Stark, Director of Marketing and Tom Green, Manager of Human Resources.

  2. Duckworth Industries - Incentive Compensation Programs Case

    Under this system, it was possible for some departments to reach bonus status more easily than others, due to variance in incentive goals. The proposed EVA would link management pay directly to the creation of long-run economic value to the shareholders.

  1. Report: Type of ownership of J-Sainsbury

    J-Sainsbury's objectives Sainsbury's has a long-standing involvement in education and is strongly committed to partnerships with education bodies There objective is to give free fruit for one week each term to be used as part of a lessons. This will encourage children to eat more fruit and lead them in eating more fruit in the future.

  2. Cohesive team building. I am going to describe how to build cohesive teams ...

    * Resource Investigator- They look up and give feedbacks on ideas that are been used outside the organisation. These ideas might belong to other organisations so you can simply say they steal ideas. Therefore, you can say they are charged with the sole responsibility of creating contacts outside of the organisation which might be of a benefit.

  1. This is a report on Marks and Spencer a well known retail company in ...

    To change the company effectively a new chief executive, Peter Salsbury was needed. He helped to bring the company into the 21st century by helping to launch the internet website, introducing credit cards and employing new management to find out the current trends, and bringing them to the stores.

  2. The 3M Company case study

    According to Professor Nonaka and Takeuchi, (1995), there is two types of knowledge :Tacit knowledge and explicit knowledge .Through this dynamic interaction between the two types of knowledge, personal knowledge becomes organizational knowledge. And the organizational knowledge or intellectual infrastructure of an organization encourages its individual members to develop new knowledge through new experiences.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work