Assignment: Designing a Reward System

: Designing a Reward System

INTRODUCTION

All companies need the professional services of an accounting firm The accounting firm services the accounting , bookkeeping , management advisory services and auditing needs of a corporation , partnership and sole individual clients . All business organizations need the professional services of an accounting firm . There are many accounting firms in the United States today . They cater to the business needs of non accounting businessmen and businesswomen . Arthur Andersen was once one of the top five auditing and accounting firms in the United States However , it has been

demoted and brought down from its pedestal because of its irresponsible accounting service done with one of its clients This client is Enron . The following performance appraisal below will be implemented in to keep the accounting firm 's employees from indulging in same illegal and unethical practices of a few employees of the disgraced Arthur Andersen accounting service firm (Thomas Bretz 1994

BODY

I . PERFORMANCE APPRAISAL

The employees will have a performance appraisal after every six months of employment . The appraisal rating will be done by four sectors . They are the employee 's group manager , his immediate superior , his or her fellow workers in the same unit or group and the all the customers directly serviced by the employee . Each sector will have a twenty five percent share of the The performance appraisal equivalents will be as follows

Outstanding 95 perceto to 100 percent

Very satisfactory 85 percent to 94 percent

Satisfactory 71 percent to 84 percent

Needs improvement : 51 percent to 70 percent

Failed : 50 percent or lower

The appraisal criteria rating will have a criteria are as follows

Job Knowledge . Consider knowledge of own job and department 's function the understanding of principles , methods , or processes used . The goal of each employee is to have exceptional understanding of all phase of the job . The maximum is twenty points Technical Skills . Consider degree of proficiency and strengths or weaknesses in such clerical technical skills like accounting , management accounting , finance , auditing , taxation , economics and other related job s . The goal of each employee is to have exceptional proficiency in all technical skills . The maximum is twenty points

Quality of Work . Consider accuracy , thoroughness , neatness of work ability to make improvements . The goal of each employee is to have excellent work quality . The maximum is twenty points

Work Volume . Consider the quantity of work accomplished and promptness in completing assignments . The goal of each employee is to generate unusually high work output and to consistently exceed job standards . The maximum is twenty points

Initiative . Consider ingenuity , self reliance , ability to originate ideas and actions , degree of supervision . The goal of each employee is to consistently perform job duties independently . He or she must initiate improvements which increases the job performance . He or she makes sound recommendations that improve departmental performance . The maximum is twenty points (Denisi , 1996 ,

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II . REWARDS SYSTEM

a ) Appraisal interviews

The employee is given the results the results of his performance appraisal . His immediate supervisor will then explain the final appraisal results to the concerned employee secretly and ask the employee 's feedback . The job performance appraisal applies to contractual employees

b ) Compensation Decisions . All employees will have are required to have an outstanding score before he or she could be give a five percent increase in salary

c ) Transfer , Demotion , Separation decisions

The employees are taught that all employees having a failed grade will be automatically fired or separated . All employees who have a needs improvement grade will be given another six months to improve . The employee will then be fired if he or she still gets a needs improvement grade or a failed grade for the second time . All employees who get an outstanding grade will receive a very satisfactory grade will received a 2 ,000 reward . Each employee who gets an outstanding grade will receive a reward of 5 ,000 reward plus a five percent basic compensation increase

Likewise , an employee who has a satisfactory grade may be allowed to transfer to another department where his or her offices skills will be of better use . This is done in to give the employee a better chance of improving his performance appraisal scores during the next appraisal period six months later . In addition , the regular employees generating a failed grade will automatically be demoted in rank . The demotion will result to a decrease in his or her honorarium and elimination of his or her administration both which are fringe benefits offered to the higher ranking officers and employees in the company Further , employees who have an outstanding and very satisfactory grade may be considered for transfer to another department when a vacancy occurs . Here , the prospective employee transferee may be considered for the position provided he or she has the skills needed for the job . An accountant cannot be promoted to the vacant sales manager position because the two jobs are definitely unrelated . However , if the accountant feels that he or she can better perform as a sales person than an office employee , then this will be granted . However , there is no returning to the accountant 's old job once the transfer has been made For , his vacated accounting job will be filled through promotion from within his unit or department (London , 1997 ,

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d ) Training and development decisions

All employees not fired will join a training and development program to help him or her improvement on his or her waterloo (weak ) areas

e ) Promotion decisions . All employees who have outstanding scores can be promoted to the next level provided there is a vacancy . In addition , all employees with outstanding scores will have their basic compensation promoted (increased ) by five percent

CONCLUSION

The performance appraisal system will be in place as a basis for the rewards , terminations , employee actions . In terms of job knowledge , the goal of each employee is to have exceptional understanding of all phase of the job . In terms of Technical skills , the goal of each employee is to have exceptional proficiency in all technical skills . In terms of quality of work , the goal of each employee is to have excellent work quality . In terms of work volume , the goal of each employee is to generate unusually high work output and to consistently exceed job standards . In terms of Initiative , the goal of each employee is to consistently perform job duties independently . Definitely , the performance appraisal system will be in place as a basis for the rewards , terminations , employee actions

Further , the rewards system is based on fair performance appraisal criteria . In the appraisal interviews , the employees understand the what , how and the consequences of his or her performance appraisal results . The employee 's compensation , transfer , demotion , separation will be based on the results of his performance appraisal . The very satisfactory and outstanding employees will receive cash rewards for their exemplary performance . All employees who have outstanding scores can be promoted to the next level if there is a vacancy . Also , all employees with outstanding scores will have their basic compensation promoted (increased ) by five percent . Conclusively , the rewards system is based on fair performance appraisal criteria

References

HYPERLINK "http /www .questia .com /PM .qst ?a o d 0 " Denisi , A . S (1996 . A Cognitive Approach to Performance Appraisal : A Program of Research . New York : Routledge

HYPERLINK "http /www .questia .com /PM .qst ?a o d " London , M (1997 . Job Feedback : Giving , Seeking , and Using Feedback for Performance Improvement . Mahwah , NJ : Lawrence Erlbaum Associates

HYPERLINK "http /www .questia .com /PM .qst ?a o d " Thomas , S L Bretz , R . D (1994 . Research and Practice in Performance Appraisal : Evaluating Employee Performance in America 's Largest Companies . SAM Advanced Management Journal , 59 (2 , 28...