Provide positive feedback: Pay-for-Performance Link. Based on your understanding of linking organization strategy to compensation and performance management,...

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Pay-for-Performance Link.Based on your understanding of linking organizationstrategy to compensation and performance management, as discussedin Chapter 9, discuss how to strengthen the pay-for-performancelink.

Powerful incentives can cause undesired behaviors.Suggest ways to solve this problem, using something you know agreat deal about – academic performance.

Oooh, fascinating question! At the end of last year I readSmartest Kids in the World by Amanda Ripley. One of thestories a South Korean boy killed his mom and hid her corpse intheir apartment for months. He was under so much stress about hishigh school graduation exams and had so much pressure to preformwell for his family that he snapped. That would be pretty extremein the US.  

Here I would expect cheating if incentives became too high.Maybe it would be in the form of buying paper. Maybe it would be inthe form of parents bribing administrators or admissionscounselors.

To promote ethical behavior teachers could try to promote classunity by recognizing accomplishments in a way that does not pitstudents against each other in competition. Maybe schools couldoffer teaching classes on ethics. Maybe they could lower theincentives or increase punishments for fraud and cheating.

How would you design a pay-performance system that usespowerful incentives to motivate behavior, yet keep the behaviorfrom veering into the unethical? (Hint: You want to keep thepowerful incentive effect of pay. So don’t recommend eliminatingincentive pay or reducing the size of the incentive component.)What’s left?

We could try increasing the punishments for unethical behavior.We could do things to promote group unity or at least keep studentsin pairs - oh but I had group projects. We could try peer reviewsto verify that those who are receiving top incentives deserve themhonestly.  

   How do you ensure ethicalbehavior?

My first thought is to hire ethical employees. Another thoughtis to encourage ethical behavior from the top down and to be quickto remove anyone caught committing fraud. At the end of the day, Idon't think we can totally ensure other people's ethicalbehavior.

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In this competitive world where everyone is racing to achieve something a high incentive pay could lead to unethical behavior a Distribution of Incentives A particular Key Result Area KRA which is linked to incentive can lead to unethical behavior For eg Incentive earned on incremental sales Instead the incentives can be    See Answer
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