T-Man Industries Compensation Plan - Essay Example

I have been charged with the responsibility of reviewing the compensation system within T-Man Industries and to make appropriate recommendations. According to Pearce and Robinson (1997 p361.): “If strategy accomplishment is a top priority, then the reward system must be clearly and tightly linked to strategic performance.” They further stated that: “Motivating and controlling managerial personnel in the execution of strategy are accomplished through a firms reward mechanism … raises, bonuses …performance appraisal, tension and fear.

” I recommend a merit-based system that is directly associated with the achievement of the nine goals identified. The teams associated with the different goals should be encouraged to achieve and surpass the goals set by T-Man Industries. For example, the R&D team would be given a bonus if they attain the leading edge and bring at least three new products to the market. This would allow the organisation to attract leading scientists to the R&D division who are motivated towards continuous innovation.