The case describes that Amica Wireless Company initially was established in its industry with a purpose to create an organization with a strong team spirit that will encourage employees to work collaboratively to satisfy customers. Based on the experiences of these managers and a bit of research, the founders of Amica Wireless developed an integrated system of goals, feedback, and rewards that was linked to three principles: 1. Ensure fair and equitable distribution of profits.
2. Reinforce teamwork and cooperation. 3. Stimulate performance. However, in the later implementation process, issues have arisen. The compensation system of Amica Wireless has undergone two changes, which were group- or organizational-level rewards and balanced approach that included both individual and group incentives. The former one was too dramatic for the managers to adopt, and the latter one made some people felt unfair and led some salespeople leaving the organization owing to dissatisfaction with pay.
From my point of view, the problem is lacking of performance management of HRM system. At beginning of formulating the institution, they made the policy of ensuring fair and equitable distribution of profits, but the problems occurred in the subsequent implementation process. Inequity led some employees’ resignations, anyone under that system would choose to leave or change. With the gradual improvement of business management and the gradually increasing quality of managers, human resources as a special resource attracted more and more attention today.
Human resources management is correspondingly taken seriously and its position gradually changed from the subordinate service job to the strategic management of human resource, and performance management is an important link of HRM in which it plays a significant role. As it is defined in textbook “performance management is the use of human resource management processes to ensure that each employee’s activities and outputs are aligned with the organization’s goals. (Bruno Dyck & Mitchell Neubert. 2010. p. 364) As the core of human resource management, performance management has also attracted more and more attention, the focus of human resource management began to shift to staff performance management, because no matter how extensive the knowledge is, how superb the skills are, and how correct the working attitude is, everything are not convincing without performance. Moreover, enterprise cannot achieve more economic benefit and produce more profits.
According to the situation of Amica Wireless, the results of performance were the effective evidence of staff of promotion, bonuses, compensation and training, which is conducive to mobilize the enthusiasm and creativity of staff, and check and improve the human resource management. Therefore, if the company wants to maximize stimulate the employees by incentive compensation, the HRM must design reasonable compensation which can better satisfy the needs of employees.
Performance management must have real reliable data to support it; the HR should investigate and analyze each position of the company scientifically, in order to obtain scientific and reliable quantitative data. These data not only can be used for performance management, but also for the position changes, staff recruitment, training and providing information of compensation management. They are important basis to evaluate the value of post and give human resource the planning and strategic management. Employees performance compensation evaluating should also take into account individual performance and team performance factors.
Thereinto, the team performance is the basis of establishing the individual performance pool, while for the second allocation of performance compensation in internal team, individual performance is the main standard. In the process of determining performance compensation, strict and reasonable performance evaluation system is essential; it is the key to employees incentive performance compensation. In short, with these measures full meet employees’ various psychological needs, better to motivate employees, and play an integral role in the incentive compensation.
Bruno Dyck & Mitchell Neubert (2010) Management: Current Practices and New Directions 1th Edition. Houghton Mifflin.