Designing an effective compensation system
Article Abstract:
Most compensation systems in US companies use a system of annual evaluations which negatively impact efforts at quality improvement. The reward system can be more significant to quality improvement than annual evaluations because employees link it to pride in their work. Compensation systems should address the three factors of salary, benefits and other rewards, all of which have a different impact on employee performance. It is essential to separate rewards extended to individuals and to groups.
Publication Name: Quality Progress
Subject: Engineering and manufacturing industries
ISSN: 0033-524X
Year: 1993
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The theory
Article Abstract:
Point # 12 of W. Edwards Deming's 14 points of management has a significant financial impact on employees by focusing on pride of workmanship with a consequent effect on pay and benefits. The relationship between compensation and achievement, however, is a complex undertaking because reward systems create distortion. US companies must adopt benefit systems congruent to Deming's philosophy, specifically those systems that relate company objectives to personal objectives.
Publication Name: Quality Progress
Subject: Engineering and manufacturing industries
ISSN: 0033-524X
Year: 1993
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Renewing American civilization, pillar five: quality as defined by Deming
Article Abstract:
Six core principles of quality management can be adapted from W. Edward Deming's basic assumptions on quality. While producers invent value, it is consumers who define value for them. To improve future results, the process must also be improved. Deming also believes that people possess intrinsic motivation to do a good job. He considers every person, process and system as part of an interdependent larger system.
Publication Name: Quality Progress
Subject: Engineering and manufacturing industries
ISSN: 0033-524X
Year: 1995
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