Reference no: EM13330474

Motivating Governmentemployees

During 1980s, finding qualified employees for jobs ingovernment sector was difficult because base pay waslow, but keeping them motivated and committed once hired,proved evenmore difficult, same problem was faced by WAPDA.

Theproblem traced was the antiquated pay-for-performance system,introduced in 1990, the system allowed 5percent annual salary increases for the consecutive 8 years withinthe salary range assigned to each positions. Each year at appraisaltime, managers met informally with their employees to review eachemployee’s performance during the year. If employeesperformed satisfactorily, they received salary increases of 5percent. As a result, almost all employees received yearly 5percent merit increase and reached the top of their salary range inthe minimum of eight years.

Thissystem discouraged superior performers, because managers could notreward them.

Managers could not approve or disapprove a merit raise. Nomatter how hard these star employees worked, they received the sameraises as everyone else. Moreover, those who had less seniority buthigher performance than their colleagues might still be paid lessuntil their eighth year, when they finally reached the top of thepay scale. Few had the patience to wait.

Higher management on realizing that their reward system was notencouraging performance, the personnel department was directed todevise a system that would encourage initiative, motivateemployees, and reduce turnover. The first step was to develop jobdescriptions for all positions in WAPDA, from supervisor toclerical job. Job descriptions would remedy a defect in the oldsystem: poorly defined criteria for performanceappraisals.

Thenew job description were assigned no more than six key goals perposition and included specified measurements to be used inassessing whether the person holding that position had accomplishedeach goal. For instance, one of the goals for supervisor is totrain, motivate, and supervise lower-level employees. The data usedto measure this objective include training records, skillcertification, productivity statistics, and employee morale figuresderived from attitude surveys.

Under the old system, managers could only approve or disapprovean employee for a merit raise. The new system allows manager fiveratings, ranging from provisional to outstanding. But officialsknew that just presenting more appraisal options would not solvethe problem. They examined the government merit system, which hasfive performance levels, and learned that fewer than 1 percent ofgovernment employees were rated in the lower two categories.Managers tabulate the point totals for each employee and comparethe results to the minimum values established for each level in therating system. Merit raises are awarded on the basis of thesevalues.

Thesecond merit system is still too new to be judged, but participantsare enthusiastic.

Managers invited employees from throughout the governmentorganizations to participate in drawing up the job descriptions sothat they would understand how the descriptions were created andwhat the revamped merit system was expected toaccomplish.

Employees now have a clear understanding of performanceexpectations, and managers have a more objective method ofevaluating employee performance.

1: What type of non-financial rewards could be offeredby the WAPDA administrators to reinforce high employee performance?

2: What role does Equity theory play in the new system?