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group and individual incentive plans

Compare group and individual incentive plans by listing the pros and cons of each. For a supervisor position, would individual or group incentives be more appropriate? Explain your answer.

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Individual Level Incentive Pay Plans. This is the most popular form of incentive pay plan. In this type of plan each person's output or performance is measured and the rewards the person receives are based upon this measurement. Clearly this is the type of incentive pay plan most likely to establish a clear performance-reward relationship in the mind of the employee. The purpose of the plan is to increase the pace of work or the effort the individual is willing to contribute in order to receive higher rewards. The classic example of this type of plan is a piecework system, wherein the employee is paid a set amount for each unit of production.11 The organization expects to receive more output than it would if the employee were paid under a time-based system. In addition, the organization can easily track the labor cost associated with each unit of output.

One assumption of these plans is that the employee is an independent operator, that he or she alone can carry out all the ...

Solution Summary

Compare group and individual incentive plans by listing the pros and cons of each. For a supervisor position, would individual or group incentives be more appropriate? Explain your answer.

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