FAIRSHARE: an investigation into driving a pay for performance system with the multi-criteria measurement technique

Abstract

Pay for performance systems are types of financial incentive program that attempts to motivate an employee by rewarding on the basis of individual and group performance. While these systems have enjoyed increased visibility in recent years, they have not enjoyed increased success. This is due to the lack of an effective performance measurement system, the validating factor in establishing a pay for performance system. An investigation was conducted at Systec Services, Inc. to see how a pay for performance system might be implemented. A performance measurement system was constructed under the basic principles of the Multi-Criteria Measurement Methodology. Further, a methodology was constructed for applying performance measurement to create a valid incentive system. This methodology was termed "FAIRSHARE". A description of the investigation, the various techniques used, a mock implementation and some conclusions drawn by the author are included.