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Person Focused Pay Systems

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1. Identify and describe at least three advantages of a person-focused pay system.

2. Identify and describe at least three disadvantages.

3. What approach would you recommend in designing a person-focused pay system? Explain the reasons for your recommendation.

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1. Identify and describe at least three advantages of a person-focused pay system.

Three advantages of person-focused pay system are that employees gain advantages in skill variety, task variety, and develop the autonomy to engage in self-directed learning. Other advantages ...

Solution Summary

Almost 170 words on advantages, disadvantages and approaches to constructing a person-based pay system.

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The focus need to be geared toward what the corporate culture and work environment is like at Aberdeen, then at Green River. How does each operation make the best use of its employees' skill sets? Based on the corporate culture, I need to identify an alterate method for them to leverage their employees abilities.

FMC ABERDEEN
Kenneth Dailey, site manager for FMC Corporation's Green River, Wyoming, facility, leaned back in his seat in the conference room near his office. He was listening to a team of employees tell him about their visit to FMC's Aberdeen, South Dakota, plant and the unusual operating procedures they had observed there. Dailey was intrigued with the results that Roger Campbell, plant manager at Aberdeen, and his predecessors had been able to achieve at the plant, and he had sent this team to see it and make recommendations about whether or not it would work at Green River. He wondered if the Aberdeen system would work for his operation as a whole, in part, or not at all; if there were parts that might work, he wondered what they were and how to implement them.

Dailey knew that his operation was different from the Aberdeen plant in a number of significant ways and that these differences would make his deliberations difficult. First, Aberdeen had only a single customer, while Green River had over 100 and distributed its products worldwide. Second, the Aberdeen facility employed only 100 people, while Green River had 1,150. Third, Aberdeen produced basically a single product, while Green River had several product lines. Fourth, Aberdeen had been a new start-up five years ago. while the first of the several Green River plants was begun in 1948. Dailey was supervising the start-up of three new plants in his complex this year, though, and recognized that similarity. Fifth, the two units functioned in very different industries-Aberdeen in defense and Green River in chemicals. Finally, Aberdeen had no union, while the Green River site worked with the United Steel Workers of America.

Despite these differences, there were several features of the Aberdeen management approach that were either appealing to Dailey or suggested that the Aberdeen approach might fit his operation. Operating under FMC corporate guidelines, both management teams enjoyed, along with the other 87 FMC North American sites, considerable flexibility in how they ran their businesses. Both units also had a common link to the FMC corporate image and objectives and thus had some similar operating values and systems. Dailey also knew that productivity in the Aberdeen plant had grown dramatically since its opening and that costs had continued to drop. Finally, Dailey felt that the principles and values upon which the Aberdeen system were built aligned well with his own. As Dailey listened to his team describe the Aberdeen system, he continued making mental notes and questions about the system and its applicability to the situation in Green River.

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