Saturday, June 13, 2015

Pay structure drives employee behaviour

If you haven't yet read Does Education throttle us off simple solutions, I urge you to read it in order to appreciate the intricacies of the current matter being discussed

So in continuation to the previous blog, our software professionals decide on continuing their spot audits through random visits; the randomness aided by complex pseudorandom-number-generator using Javascripts, which surprisingly falls on friday nights or weekends

Meanwhile, out there, our 'farmer cum watchman cum caretaker' after much deliberation, is convinced that he needs a pay hike. After all, he has toiled for a year, put his sweat in tilling the land, watering the crops and guarding them through night & day

"Yes, the crops did get 'stolen' under my supervision but that was fate; I need the hike for my hard work" he reasoned to his wife

"Yes, these software guys just sit in front of that coloured box all day, keep drinking tea and get highly paid; of course you should get a hike" added his loyal wife

So when our software professionals arrives 'as expected', our 'farmer cum watchman cum caretaker' approaches them

"Sir, I need an increase in my pay; I have worked hard and I deserve the hike", he said sternly and with conviction 

The look on our software professionals was of utter shock & disbelief; they also realised the situation was delicate and had to be handled carefully; for, what would they do, if he quit

An emergency huddle was dutifully called

"I still can't believe he is asking for a rise", said one of the software professionals

"Exactly, what does he think? Because of his carelessness, we lost our yield and he has the audacity to ask for a pay hike"

"And think about it, we are giving him free stay, electricity and water for his family apart from aiding his child's education and he still expects more!"

"We should add these in his CTC and show him the total cost" quipped the fourth

So after deliberating for an hour, as most corporate meetings, they decided to call for another meeting

In Bangalore, they huddled again and one of them had the eureka moment

"The problem he thinks he deserves a hike is because we did not link the result of his work to his salary", she exclaimed 

Assuming that the 'farmer cum watchman cum caretaker' was a paragon of virtue and had no hand in the robbery of the crops, it is bound that he thinks he had toiled for a year, got the crops to bear fruits and thus had achieved his targets; just one incident of robbery shouldn't outweigh the other goals that he had achieved

As pointed out, if they had linked a part of his remuneration to the successful outcome of the crops, he would have felt more responsible to ensure the goals are achieved

Remuneration structure should always be thought out well because it drives the employee behaviour; it sets the difference between an employee feeling satisfied that he has clocked 45 hours a week to another who assesses if he has helped achieve the project goals

Be prudent, Remuneration and Metrics, drives employee behaviours

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