- Employees’ level of commitment to the company
- Length of the program
- Manager expectations vs. employee expectations
- Realistic balance of company cost and employee reward
Length of the Program
Manager Expectations vs. Employee Expectations
- How long will the program be in place?
- What are the reasons behind the program? (Are you attempting to meet a client deadline, beat the competition to market, temporarily push to fill a productivity gap, etc.?)
- How difficult will it be to see a pay increase based on the requirements of the program?
- How will outside factors affect evaluation? (For example, if an outside manufacturer is late with a delivery that one of your departments needs to continue with production, will the affected department suffer under the performance pay program’s deadlines despite the fact that the delay was no fault of their own? If not, how will the rules be adjusted?)
Costs vs. Benefits
- What estimated percentage of employees will receive increased pay under the program?
- How much of a pay increase will employees have to receive in order to sustain increased performance? Can the company afford that increase?
- Realistically, how much will the company benefit from the increased employee performance?
- How long can the company sustain the program?
- How much time will management have to spend implementing, tweaking, and/or redesigning the program? How much will those adjustments cost the company?
- Could the predicted benefits of the performance based pay system also be achieved through more conventional and less costly managerial methods like coaching, training, etc.?