The short answer is yes – merit reviews and raises do have a good role to play and yes they do have a good role to play. In today’s climate it’s a question of how to do more with less. Merit raises can be seen as a very good return on investment and expenditure for any and most businesses. It’s as if you are paying back a worker a small percent interest or fee for making you money or even just sales.
Yet the question begs – how do you as management or supervisory staffs get the most out of merit raises and reviews?
First of all granting merit rises once a year to all qualifying employees in them destroys the tools motivating power as workers come to expect them. On the other side of the fence is the ludicrous idea of rating in reviews that the scale is limited. On the other side of the fence management should be held responsible when such misdeeds of using reward structures to be a nice guy or win a popularity contest are carried out. In some firms it went as far as management granting off the top 10 out of 10 merit review rankings. Either this was done as unknowing routine or just sloppiness or downright incompetence. Later when employers were terminated they could demand large severance packages pointing out via their lawyers that their performance was more than adequate and satisfactory being exemplary at 10 out of 10. To make it more like a Dilbert scenario management often rebounded and in later years
Yet in the following years when later staff and hires were led through the maze of steps for the then current annual or semi annual merit review it’s as if they had to pay for management’s missteps and misdeeds. Management and the rule of law had rebounded. The first rule of any review and reward procedure and system is that it must be clear, fair and non-arbitrary or even self serving to management.
Yet what those received under task was a preamble, like they might have received flashed across a TV screen for a financial planner or mutual fund investment “Past rewards are no indications of future rewards or performance …” In the message of the preamble they might be explained that the scale was 1 to 10, ten being the best or at the top of the ranking scale. Yet the most anyone even the lord of the universe could receive was an 8 ranking at the top. To which the victim being reviewed for “merit “ should well ask – then the ranking is not 1 to 10 but rather 1 to 8 . Yet the most the employee could be told by junior staff employed for this task was “that is the way it is “or “that is the word / view / edict” from the top.
In summary merit reviews in current business climates do have a good role and place. They stand to reward and solidify good performance that resulted in benefits and perhaps profit or earnings to a business or organization. However it is a case that any assessments and resulting pay or promotion rewards must be ranked, awarded and rewarded on a clear and fair basis in full and total. Otherwise the whole procedure is in essence a sham, a poor use of expensive management time and costs and in the end may be a deterrent and indeed a source of negative incentive and morale to the employee and as well can rapidly spread through a whole organization or business.