Pay-for performance is
an examining example of type management control that was encoded with result
control, as related with rewards to create a good result, or punishment to the
bad result. Giving priority (reward) relating to results are not only forware
of compensation in money forms, but also in other shapes such as job security,
promotion, autonomy and recognition. Result controls creating meritocracies. In
meritocracies, awards are provided to the employees who work the hardest and
have a consumer talent to those who have the last most possibility or social
connection level.
Award combinations
connected with results tell and remember employees about results which are
important and motivates them to produce the 'result' for interest
organizations. Result controls will influence the action, cause result controls
cause the employees very possible attention to the consequences of the action
that they do. Organizations no more employee employees about doing what to do,
but they are provided to take various actions which they sure to produce
expected 'result'. However, as any other forms of management control, result
controls may not be implemented in any situation. Result controls will be
effective when the 'suitable' results can be fully (or most) controlled by the
employees and the controlled 'result' reliable areas can be measured
effectively.
INSTANCES OF RESULT CONTROLS
Result controls
is an important element in management approach to employ employees. This trend
started in 1990an, and implemented in dominants to control the behavior of
professional employees, they are responsible for result, and do not only
implement the task. Result Controls is expressly required and consistent with
implementation of the organizational desentralization concept, which is
incorporated for autonomy conduct center.
ELEMENTS OF RESULT CONTROLS
To implement
the result of controls required 4 (four) phase:
Defining performance dimension. Determining
the dimension of performance is a critical thing for the purpose determined and
followed by measurement, can make the way of employees about what is important.
In business terminology out of hearing "what you measure is what you
get". Why dimensions of this performance is not defined by appropriate,
(the articles do not completely with organizational objectives or not
compatible with strategy), result controls will encourage employees to do the
missing things.
Measuring performance. Measurement,
which is attaching the numbers of the numbers to certain object, is an
important result controls element. Certain object is performance of employees
(or groups of employees) in certain time period. Various different measurement
results then can be connected with rewards, whether are financial or
non-financial.
Setting performance targets. Performance
targets or standards is the other important element of the control system
results. In result control system, target must be removed for any aspect of
performance measurement dimensions. Performance targets may influence behavior
through 2 ways: (1) performance targets encourage action and increase
motivation, through the presentation of expressed purpose which must be
accessible by employees, and not statements of the caps. (2) performance
targets provide employees for immune performance of their own performance.
Everyone in the basics will not receive the feedback, unless they able to
understand the articles.
Providing
rewards (or punishment).
Rewards and punishment is the lastest important element of the control system
results. General advice included in contract can include institution of salary,
bonus, promotion, warranty jobs, assignment of work, training opportunities,
freedom, recognition and power. Punishment is are recovery from awards, such as
protected, not approval from the exclusive, public embarrassment, failure to
acknowledge such a work accepted, or loss of the job.
CONDITIONS
DETERMINING THE EFFECTIVENESS OF RESULT CONTROLS
Managers Know What Results Are Desired In The Areas Being Controlled. Managers
should understand the winning results in the area which they control, and communicate
the effective desire effective with the employees working in a controlled such
area.
The Employees Whose Behaviors Are Being Controlled Have Significant
Influence On The Results For Which They Are Being Held Accountable. Employees
which have been controlled to be able to influence results in a material way in
a particular period of time. Controllability this principle is one of the
important responsibility of accounting.
Managers Can Measure The Results Effectively. The ability to
measure controllable resuts effectively is the last condition of the feasible
result controls application. Outlooked resulted result, that is really inquired
organization, can not be meaned effectively. Its own measurements become
problems - all the situations a time can be meaned; but sometimes areas of key
results (key result areas) can not be measured effectively.
EVALUATION CRITERIA. Precise. Objective, Timely, Understandable.
Reference:
Merchant, K. A., & Van der Stede, W. A. (2007). Management control systems: performance measurement, evaluation and incentives. Pearson Education.
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