Article (December-2016)


R&R Practices at GHCL - Pay for performance & behaviour

Rajesh Tripathi

Designation : -   Chief Executive Officer

Organization : -  Kenbox Technologies, Noida


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Rewards and recognition, since time immemorial, has been used to gratify individual actions and outcomes. Seldom, it has been used to punish or incriminate people based on their actions or in a way which is suggestive of their inappropriate actions. In my view, performance is a function of people's behaviour in the organization. It means that organizations, depending on their needs, can choose distinct behaviour and use the reward and recognition management to strengthen them. Such kind of a system in place will help to create a unique culture within the organization which cannot be replicated elsewhere easily. There are certain key factors which should be on the top of the HR while coming up with such a kind of system in place like:


  •     Identifying company's mission, vision  that the reward program will support.
  •     Identifying the desired employee performance or behaviours that will reinforce the company's goals.
  •     Determination of key measurements of the performance or behaviour, based on the individual or group's previous achievements.
  •     Determination of appropriate rewards.
  •     Communicating the program to employees.

Formulating and putting into practice an impregnable reward and recognition system demands for careful and immaculate analysis of the company's policies and procedures. Deciding how to recognize employees' efforts and what to provide them requires thorough analysis of responsibilities and risks involved in a particular job. The reward and recognition system of an organization should also be aligned with the goals, objectives, mission and vision and value system of the organization. Choosing the monetary or non-monetary approach lies at the sole discretion of the management weighing the value addition of the profile and the exemplary work done by the incumbent.

GHCL has been ably successful in salvaging the faith of its employees in our compensation system as the objective of our rewards and recognition management is to build a performance & compensation management system based on proven principles of human capital management using measurement yardsticks derived from organisational goals and values.  This helps the company to bring in a qualitative change in the mindset of the employees towards appreciating the steps being taken by the management in improving performance management and compensation practices and aligning them with business goals.

The compensation philosophy of GHCL mainly focuses on "Pay for Performance - Pay for Behaviour: fairly & competitively by adopting tools & techniques that help in achieving it" with a commitment to reward its Top Performers who has exhibited compatible behaviour as well.

With regard to remuneration, at macro level, GHCL believes in providing market driven compensation to its employees. If viewed in the total cash compensation matrix, the company pegs itself in the upper most quadrant or percentile. Periodic compensation surveys are done to ensure that this positioning remains intact in each of its business segments. Internally compensation decisions are based on consideration of individual's knowledge, skills, competencies, experience & exposure. It thus means decisions are guided by Pay for Position, Pay for Person and Pay for Performance.  In other words, the company looks to pay for a particular position its worth in the market, add premium in lieu of the uniqueness of the person by way of his individual knowledge, skills and competencies and finally tops it to the performance he delivers.

We tend to define performance in the organisation as the result of the efforts of individuals towards achieving goals in the four major areas viz. Product & Process Innovation, Delighting Customers through Serviceability & Quality, Operational Optimisation and Enhancing Shareholders' Return. Assessment of individuals against these broad goals is done at multi levels to ensure objectivity in the process and also minimise anomalies that emerge from individual biases. This assessment is done in a very transparent manner and taking into consideration the views of opinions of cross-functional peers as well.

We do also have a formal recognition for commendable performances of employees in their role.  This is in addition to the annual performance appraisal based reward.  Such commendable performances are reported instantly and on merit they are rewarded subsequently.  The overall objective of these schemes is to promote a performance based work culture.  The types of achievements typically covered under these schemes are:

a.    Dedication to continuous improvement, teamwork and customer service.

b.    Excellence in leadership, motivation and support of staff.

c.    Exceptional level of performance within career fields.

d.    Commitment to quality delivery of services.

e.    Years of service.

Such kind of services and performances are rewarded in the following manner
a.    Exemplary Award - Any individual action which leads to significant monetary benefits for the organization is eligible for this award.

b.    On the spot Award - Any individual who put down extra efforts for performing an activity is eligible for this award.

c.    Long Service Award - An employee who completes a decade of service in the organization is eligible for this award.

Another reward mechanism GHCL employs is to provide opportunity to its people to earn and enjoy benefits pertaining to their development. The said mechanism is called 'VIKAS'. The 'VIKAS' has an in built feature for on-the-job development.