The proposed closures would move the production facilities further away from the existing customer base, which would force employees of those facilities to either mute farther (additional costs) or refuse the farther commute and quit. In order to avoid this drastic measure, I propose a restructuring of the existing compensation packages as well as implementing a new performance management system. This proposed solution can help Identify where more cost effective solutions exist without causing undue hardship on the employees.
Performance Management System In order to implement the correct performance management system, an internal review of all the jobs within the organization will be conducted. The review will rank he Jobs in order of importance to the organization. The Job analysis will define the responsibilities of that particular job which will then be used as a tool to evaluate against employee performance. This Job analysis may result In Job loss as some of the duties may prove to overlap. Which creates Inefficiencies and loss of production.
The evaluation process will be conducted using the Critical Incident method as opposed to the Checklist method. The critical incident method focuses more on the individual behaviors that may be causing the inefficiencies within the employee’s reference. Corrective action will be noted in the employee file and a re-evaluation will be conducted at a pre-determined time as to track the progress of the employee. The progress of the employee will be the basis for retention or pay Increases. The Job description will be used to appraise the employees utilizing the proper standards.
The employees will be provided with an understanding of the standards and after performing the Job, the standards will be the basis of evaluation as to how well the employees met those standards. Proper training will be conducted to better id in the overall employee productivity and through continuing education find ways to Improve performance of the employee. Compensation All of the JAVA Corporation employees have become use to the perks that JAVA offers, such as the fitness rooms, playgrounds, full kitchens and multiple break rooms.
Because these facilities enhance the quality and performance of the employees, it is my opinion that these remain part of the compensation packages. However, the additional compensation programs above and beyond those previously listed should be put on hold status until the company is once again growing and rosaceous. Profit sharing should remain as It promotes good morale throughout the based on performance ratings on a case by case basis. The elimination of the commission part of the compensation package will be the toughest pill to swallow throughout the corporation.
It will be suggested that the employees be evaluated utilizing the new performance review format that has been described in detail previously in this report. The employee’s current profile, external markets and internal organization factors will be used to determine how close the pay scale is to that of the industry. Utilizing this information, along with the Job analysis and performance evaluation, new baseline wage, medial wage and the high- end wage will be determined for each position.
This may result in a pay increase for some but more importantly, it creates a standard to which to measure performance and pay. A accompanied announcement will be made with regards to the adjustments and changes to the compensation packages. Due to the sensitive nature of the information, it should be disseminated down through the proper channels in the form of executive meetings. The compensation committee should be ready to answer questions and be able to address the issue of preserving the corporation through difficult economic times.
The employees will need to know that the corporation has a personal interest in making sure the corporation remains in business, which will gain loyalty from the employees. The employees will need to be educated on the evaluation process and performance rating and how it will affect their Job and bonus, if eligible. Training will be provided to address these, along with performance issues, ways of increasing / improving the production processes. The employees need to know that as the corporation’s profitability increases, so will the percentage paid out through profit sharing.
Through this change alone, the corporation could see a 3%, possibly more, reduction in revenue spending. This figure could increase with the implementation of the performance management system. In conclusion, by reviewing the compensation packages and implementing the performance management system, JAVA Corporation will be able to streamline the production processes, reduce expenditures and maintain the employment sector while increasing production and profits.
