MGMT 104 Lecture Notes - Lecture 5: Free Rider Problem, Job Evaluation, Four-Minute Mile
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Job evaluation approach (what are you paying people with similar jobs?) Identify compensable factors to group together jobs of similar value. If you (cid:272)ha(cid:374)ge the sala(cid:396)y of o(cid:374)e jo(cid:271), you"ll p(cid:396)o(cid:271)a(cid:271)ly (cid:374)eed to (cid:272)ha(cid:374)ge the pay of othe(cid:396) jo(cid:271)s: market-based approach (what are your competitors paying for this job?) Benchmark pay to what others are paying for similar work (by geography, occupation, industry) Hr consulting firms help with the collection and dissemination of this information. Many employers use a combination for at least some jobs. Individual incentives raise performance: we are irrational and care about social interests too. Because of this, the free rider problem is not really present: people work only for money. Performance pay: how well you perform o(cid:374) the jo(cid:271) affe(cid:272)ts (cid:1007)(cid:1009)% of jo(cid:271)s" (cid:449)ages (cid:894)(cid:374)ot (cid:374)e(cid:449)(cid:895: piece-rate pay- hallmark of factory work, pe(cid:396)fo(cid:396)(cid:373)a(cid:374)(cid:272)e pay (cid:449)o(cid:396)ks (cid:449)he(cid:374) . Wo(cid:396)ke(cid:396)s" output is easily measured (in quantity and quality)
