Management Issues posted this article called, Smaller pay raises lead to boom in performance bonuses. Here’s a disturbing snippet:
American employers are increasingly relying on performance-related pay awards that must be re-earned every year to attract and motivate their workers.
With wage rises during a period of economic expansion failing to keep pace with inflation for the first time since World War II, most American workers are keenly aware that rising energy, medical and interest rate costs have cancelled out any pay rises they may have earned this year.
But a survey of 1,028 large employers by Hewitt Associates has found that bonuses and performance-related pay deals are increasingly filling this gap.
I don’t dispute that this is happening – it is. But what about the fact that the basic assumptions about motivation and optimizing performance are all messed up? Rely on performance bonuses and you are putting a lid potential.
I am really baffled by this trend. Most HR execs are smart and caring folks. The science of motivation is not new, we know what works and what doesn’t. It seems as though we are held and being sucked in by a tractor beam of extrinsic reward systems. Why is this the case?
I would love to hear senior leaders and HR execs about this.
My oh my, what’s the answer? How can we right this tanker ship that is leaning in the wrong direction?
Pick your fable – we’re in it!
How’s this for a book title:
Get Rid of HR: And What to Do Instead
I almost think we need to start fresh.