People, Performance, & Pay : Dynamic Compensation for Changing Organizations

Rating:
Summary: Compensation strategies from the Hay Group
Review: 'People, Performance & Pay' is must-read for all executives and HR professionals who want to understand the point-based pay system, known as the Hay Guide Chart-Profile Methodology. With concrete examples from their consulting experiences, Thomas P.Flannery, David A.Hofrichter, and Paul Platten clearly explain how to develop compensation strategies to support business values, work cultures, and strategic goals.

In the literature, the Hay system has been criticized because it may promote a bureaucratic culture and because it fails to differentiate between high and low performers or contributors. For example, Edward E.Lawler writes, in his 'Rewarding Excellence,' "the Hay system is the most commonly used approach for determining pay and reward levels in large organizations, although numerous other evaluation systems have also been developed. There is a real question, however, about whether Hay or any of the others is the best approach in today's business environment...Job evaluation fits a traditional bureaucratic approach to management that relies heavily on control through job descriptions, standardization of work, and hierarchical levels of management." On the other hand, after defining the Hay system as 'pay for empire,' Peter Block argues, in 'Stewardship,' "it is a widely accepted method of using job descriptions- including the number of direct reports, type of budget responsibility, and levels of responsibility and decision-making authority- to make rational the different pay levels within an organization. For what it was asked to accomplish, this system has done an elegant and durable job. But we must question exactly what it was we asked the Hay system to do-to pay people based on the size of their territory, number of subordinates, budget size, level of authority...Soften it if you like, but these are measures of empire, not contribution to the organization."

In this context, the authors say that "certainly there is truth in Block's statement. Indeed, as the title of our book suggests, people and their performance-their contribution both as individuals and as members of the organizational team-are the linchpins of any effective compensation strategy. But that title and statement do not, despite what our critics might say, signal a sudden shift in our philosophy about pay. The fact is, we've always believed that people and how they performed constitute the foundation of any successful business strategy. We've always believed that compensation is an important element of a successful human resources equation that puts people first...When the Hay system is properly used in the right circumstances, it can still be very effective in creating people-and performance-oriented pay programs."

I highly recommend this reference source on the Hay system.

Rating:
Summary: Compensation strategies from the Hay Group
Review: 'People, Performance & Pay' is must-read for all executives and HR professionals who want to understand the point-based pay system, known as the Hay Guide Chart-Profile Methodology. With concrete examples from their consulting experiences, Thomas P.Flannery, David A.Hofrichter, and Paul Platten clearly explain how to develop compensation strategies to support business values, work cultures, and strategic goals.

In the literature, the Hay system has been criticized because it may promote a bureaucratic culture and because it fails to differentiate between high and low performers or contributors. For example, Edward E.Lawler writes, in his 'Rewarding Excellence,' "the Hay system is the most commonly used approach for determining pay and reward levels in large organizations, although numerous other evaluation systems have also been developed. There is a real question, however, about whether Hay or any of the others is the best approach in today's business environment...Job evaluation fits a traditional bureaucratic approach to management that relies heavily on control through job descriptions, standardization of work, and hierarchical levels of management." On the other hand, after defining the Hay system as 'pay for empire,' Peter Block argues, in 'Stewardship,' "it is a widely accepted method of using job descriptions- including the number of direct reports, type of budget responsibility, and levels of responsibility and decision-making authority- to make rational the different pay levels within an organization. For what it was asked to accomplish, this system has done an elegant and durable job. But we must question exactly what it was we asked the Hay system to do-to pay people based on the size of their territory, number of subordinates, budget size, level of authority...Soften it if you like, but these are measures of empire, not contribution to the organization."

In this context, the authors say that "certainly there is truth in Block's statement. Indeed, as the title of our book suggests, people and their performance-their contribution both as individuals and as members of the organizational team-are the linchpins of any effective compensation strategy. But that title and statement do not, despite what our critics might say, signal a sudden shift in our philosophy about pay. The fact is, we've always believed that people and how they performed constitute the foundation of any successful business strategy. We've always believed that compensation is an important element of a successful human resources equation that puts people first...When the Hay system is properly used in the right circumstances, it can still be very effective in creating people-and performance-oriented pay programs."

I highly recommend this reference source on the Hay system.

Rating:
Summary: Interesting but Outdated
Review: Don't believe the other reviewers when they tell you this book will teach you how to use the "Hay system" (whatever they mean by that). It has nothing to do with Guide Charts and doesn't teach you how to use the Culture Sort analysis (although it does list the culture attributes, which could enable you to figure out the model is you know what you are doing and have experience in this).

The most important take-away from this book is how business culture affects your remuneration structures.

Written in 1995/6, the book is definitely outdated. ALL companies are moving to a "process based" system and reducing the benefits component of remuneration. You don't need a book or Hay consultant to tell you that.

The book is fairly easy reading with a good index. It lacks extensive 'war strories' which show application of the principles.

Rating:
Summary: Interesting but Outdated
Review: Don't believe the other reviewers when they tell you this book will teach you how to use the "Hay system" (whatever they mean by that). It has nothing to do with Guide Charts and doesn't teach you how to use the Culture Sort analysis (although it does list the culture attributes, which could enable you to figure out the model is you know what you are doing and have experience in this).

The most important take-away from this book is how business culture affects your remuneration structures.

Written in 1995/6, the book is definitely outdated. ALL companies are moving to a "process based" system and reducing the benefits component of remuneration. You don't need a book or Hay consultant to tell you that.

The book is fairly easy reading with a good index. It lacks extensive 'war strories' which show application of the principles.

Rating:
Summary: Useful book relates total compensation
Review: This book is an excellent resources for leaders of companies,that are reengineering key process and to sustainable competitive advantage and offers ways of thinking our business strategies or changing organizational.
This book offers excellent ideas for using innovative reward and recognition programs to accelerate organizational and culture change.

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