Compensation Strategy and High Performance Culture
The relation of the compensation strategy and high performance corporate culture is essential for the successful introduction of this kind of corporate culture to the organization.
The high performance corporate culture always needs a strong support from the compensation strategy. The high performance usually needs a strong differentiation among groups of employees to provide a huge benefit to the best employees and to push the low performers to get to the expected level of the performance.
The high performance culture brings a necessity to differentiate strongly among different groups of employees. The high performers need to feel the satisfaction from the organization and their strong contribution to the results of the organization. The issue is with the line management, they prefer not to make anyone unhappy and they prefer to distribute about the same amount to the whole team. The low performers should receive about the same amount as the high performers and they prefer not to announce the real results of the performance evaluation.
The low performers should be clearly and visibly identified in the high performance corporate culture. The compensation strategy and compensation policy should clearly define the rules for the base salary and bonuses for low performers and the punishment to press this group of employees out of the organization.
The real high performance corporate culture shows to the employees their real results and how they are evaluated by the organization. The organization sets the standard set of the behavior and expected performance level, which is publicly known and the employees are confronted with the reality. The employees need to see clear guidelines for the performance measurement and the final performance evaluation to adjust their behavior the way the organization needs and provides compensation for.
The compensation strategy should not be a policy to introduce the high performance culture to the organization, the compensation strategy has to support the corporate culture and it has to be driven by the top management. The compensation strategy has to deliver the tools to support the corporate culture and the objectives of the organization.