Remuneration On Productivity Case Study

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The Effect of Remuneration on Productivity Case Study at PT. PAL INDONESIA - Gresik Abstract Low Productivity is the main cause of a company losing their income and position in the market. As a government-owned business, PT. PAL Gresik is also risked their income by having a low productivity. This research’s main goal is to understand what drive the people that is working in the government sector. The main variable used here is the remuneration effect toward productivity. Many suggested that the problem of government owned business is the lack of incentive and the ability of its people to go into higher level in the company. In this research, not all of the company will be examined however only the loading section of the company which is …show more content…

surpassing some sales targets. When the employee surpasses their target, he or she can be given an additional amount to their salary; this will make them strive to achieve more (Maund, 2001). Research has proven that when human being are appreciated and praised they tend to improve their performance. This is another way an organization can apply as a reward so as to improve performance. Praise could be shown in the organization newsletter or in meetings. When managers take time to meet and recognize employees who have performed well, it plays a big role in enhancing employees’ performance (Torrington & Hall, 2006). Organizations should reward employees more often. This greatly improves performance compared to having the rewards maybe only once a year. This is because frequent rewards are easily linked to the performance. (Thomson & Rampton, 2003).Measuring performance is of great importance to an incentive plan because it communicates the importance of established organizational goals. “What gets measured and rewarded gets attention” (Bohlander et al, 2001).In discipline of human resource management, different writers suggest the following indicators for measuring employee performance and they include: quality that can be measured by percentage of work output that must be redone or is rejected; Customer satisfaction that can be measured by the number of royal customers and customer feedback. Also, timeliness, measured in terms of how fast work is performed by the employee when given a certain task; absenteeism/tardiness observed when employees absent themselves from work; and achievement of objectives measured when an employee has surpassed his/her set targets, he/she is then considered to have performed well to achieve objectives (Hakala, 2008; Armstrong,

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