How Pay for Performance will impact improved work production to support supply chain

What is the format for literature reviews?
“Just like most academic papers, literature reviews also must contain at least three basic elements: an introduction or background information section; the body of the review containing the discussion of sources; and, finally, a conclusion and/or recommendations section to end the paper.

• Introduction: Gives a quick idea of the topic of the literature review, such as the central theme or organizational pattern.

• Body: Contains your discussion of sources and is organized thematically.

• Conclusions/Recommendations: Discuss what you have drawn from reviewing literature so far. Where might the discussion proceed?”

“Sometimes, though, you might need to add additional sections that are necessary for your study, but do not fit in the organizational strategy of the body. What other sections you include in the body is up to you. Put in only what is necessary. Here are a few other sections you might want to consider:

• Current Situation: Information necessary to understand the topic or focus of the literature review.

• History: The chronological progression of the field, the literature, or an idea that is necessary to understand the literature review, if the body of the literature review is not already a chronology.

• Methods and/or Standards: The criteria you used to select the sources in your literature review or the way in which you present your information. For instance, you might explain that your review includes only peer-reviewed articles and journals.

• Questions for Further Research: What questions about the field has the review sparked? How will you further your research as a result of the review?
Important Points to Consider

The paper is to be written in strict conformance to current APA standards, and must contain 6 pages of content (excluding the title page, abstract, and references), utilizing at least 12 scholarly sources.

Three levels of current APA headings must be used throughout the paper.

For the purpose of this academic paper, adhere to the follow rules when quoting or using a source:

• Do not directly quote more than 120 words from any one source.
• If the source is 2,000 words or less, do not directly quote more than 50 words from any one source.
• Do not use the same source more than a total of 3 times within the whole document for quoting or paraphrasing.
• Quotes must contain the section (if provided) and paragraph or page numbers of the quote, and this information must be placed in the reference.
• In all instances, use current APA guidelines for citations and references.

The paper must not be a series of quotations. Quotes should be used sparingly

All references must be 2014-2021 and have to be in this format making sure the DOI is included:

Drollinger, T., Comer, L. B., & Warrington, P. T. (2006). Development and validation of the active empathetic listening scale. Psychology & Marketing, 23(2), 161-180. https://doi.org/10.1002/mar.20105

Rubric:
Synthesis of Knowledge (Focus/Thesis)
Student exhibits a defined and clear understanding of the assignment. Thesis is clearly defined and well-constructed to help guide the reader throughout the assignment. Student builds upon the thesis of the assignment with well-documented and exceptional supporting facts, figures, and/or statements.
Foundation of Knowledge
Student demonstrates proficient command of the subject matter in the assignment. Assignment shows an impressive level of depth of student’s ability to relate course content to practical examples and applications. Student provides comprehensive analysis of details, facts, and concepts in a logical sequence.
Application of Knowledge (Critical Thinking)
Student demonstrates a higher level of critical thinking necessary for graduate-level work. Student provides a strategic approach in presenting examples of problem solving or critical thinking, while drawing logical conclusions which are not immediately obvious. Student provides well-supported ideas and reflection with a variety of current and/or world views in the assignment. Student presents a genuine intellectual development of ideas throughout the assignment.
Learning Outcome Organization of Ideas/Format
Student thoroughly understands and excels at explaining all major points. An original, unique, and/or imaginative approach to overall ideas, concepts, and findings is presented. Overall format of assignment includes an appropriate introduction (or abstract), well-developed paragraphs, and conclusion. Finished assignment demonstrates student’s ability to plan and organize research in a logical sequence.
Writing Skill
Student demonstrates an excellent command of grammar, as well as presents research in a clear and concise writing style. Presents a thorough, extensive understanding of word usage. Student excels in the selection and development of a well-planned research assignment. Assignment is error-free and reflects student’s ability to prepare graduate-level writing for possible publication in a peer-reviewed (refereed) journal.
Research Skill
Student provides sophisticated synthesis of complex body of information in the preparation of assignment. Research provided by student contributes significantly to the development of the overall thesis. Student incorporates at least 12 quality references in assignment. Student incorporates a variety of research resources and methodology in the preparation of assignment.

ANSWER

How Pay For Performance Will Impact Improved Work Production to Support Supply Chain

Introduction

Over the years, the topic of Pay for Performance (PFP) has been a controversial one. Some argue that it is the most effective way to motivate employees and improve work productivity, while others claim it can lead to unfairness and resentment amongst staff.  Performance-related pay is a system of paying employees that take into account their skills and performance. According to Mujtaba and Shuaib (2010), pay for performance is a compensation approach in which remuneration is systematically linked to measurable output. In theory, PRP should provide an accurate indication of employee results in the company revenue, as it relates salary to individual performance rather than the time spent in completing the tasks (He et al., 2021). This paper will focus on a systematic literature review on how performance pay improves work production to support the supply chain. Pay for performance influences labor productivity, employee performance and motivates employees, thus leading to improved work products to support the supply chain.

The literature evaluation was conducted through a systematic review. The systematic review relies on logical and explicit methods to search, select and synthesize and critically appraise multiple sources. The research was conducted using keywords “pay for performance,” “work productivity,” “retention’ and “performance.” The findings were extracted from sources that seemed to fit the research question.

Increased Productivity

Most studies have shown increased productivity owing to the implementation of pay for performance model. According to Gielen, Kerkhofs, and Van Ours (2010), recent developments such as globalization have increased the competition levels, which have forced organizations to look for ways of improving productivity. Performance-related pay has been one of the most common instruments to facilitate productivity. He et al., (2021) support that pays for performance boosts labor productivity for two reasons; the scheme’s ability to induce employees to exert the right effort at work and the mechanism’s ability to encourage more talented and able workers to apply for jobs. Ideally, pay for performance tends to align the compensations employees receive with their contributions in the workplace. Therefore, they tend to produce more to receive more pay.

Ogbonnaya, Daniels, and Nielsen (2017) state that most managers agree that productive and motivated employees are vital for the success of an organization. However, the biggest question is always how to motivate the employees to boost their work production. Pay for performance has been one of the most effective approaches for increasing productivity (Lazear, 2018). Relatively, Green and Heywood (2008) support that switching from fixed wage compensation to pay for performance increases the average productivity. The correlation between pay for performance and labor productivity is also supported by Iqbal, Tian and Akhtar, and Sohu (2019), who found out that Pay related performance boosts productivity at the firm level and employee growth.

Idowu (2017) supports that pay for performance increases productivity since the large bonuses, payments and commissions are forms of incentives that motivate the employees to put more effort. Ideally, when the overall impact of pay for performance dominates, the output will increase, but if the selection effect is greater, employees’ productivity tends to fall. Iqbal, Tian and Akhtar, and Sohu (2019) conducted a study that examined the relationship between pay for performance and employee productivity. The findings indicated that there is a positive relationship between performance-based compensation and employee productivity. The increase in productivity leads to lower margin costs during the production, enabling the firms to hire additional workers, positively influencing work production. Additionally, Rehman and Ali (2013) researched merit pay and found out that when salary is attached to merit, the employees in the organization tend to focus on efficiency and improved quality of work done. Therefore, this research shows that a performance-based system improves the productivity of employees. The studies have focused on the relationship between pay for performance and productivity. They have shown that focusing on the pay-for-performance approach can improve the productivity of employees, which boosts work production, thus supporting the supply chain.

Employee attraction and retention

Schlechter, Hung, and Bussin (2014) argue that to maintain and attract expert workers, an organization has to understand how the attraction and retention of workers are influenced by the types and levels of financial compensation. The study by Schlechter, Hung, and Bussin (2014) shows that variable pay, high levels of pay, and benefits significantly influence job attraction and retention. Therefore, organizations have to consider the type of financial compensations in their organizational talent attraction approaches. Organizations have begun implementing the pay for performance practices to retain and attract the best talents, which improve the productivity and performance of the organization.

Uwimpuhwe, Mushabe, and Bally (2018) state that compensation plays an essential role in determining employees’ retention and commitment levels. Organizations often rely on high pay packages such as retention pay, performance-based pay, and gain share pay to attract talented employees in the market. The ability to retain talent in supply chain management is essential in preserving high morale, the company’s knowledge, and satisfied customers that increase sales growth. Uwimpuhwe, Mushabe, and Bally (2018) state that organizations desire that their pay systems will help retain and attract high-quality and better-performing staff. In the latest comprehensive review by Shaw and Mitra (2017) on the effects of pay for performance system, it is clear that financial rewards have a powerful influence on work performance.

Ren, Fang, and Yang (2017) investigated the effect of pay for performance and pay level gratification on the affective commitment, job satisfaction, and turnover intent and found out that the pay for performance perception and the pay level satisfaction are great predictors of extra-role behaviors and work attitudes. Considerably, pay for performance is an intrinsic motivation that means that individuals exhibit job satisfaction due to the separable consequence of performance pay. Mgedezi, Toga, and Mjoli (2014) conducted a study that examined the association of job involvement and intrinsic motivation with employee retention as the mediating variable. The study’s independent variables were job involvement and intrinsic motivation, while the dependent variable was employee retention. The study results show that intrinsic motivation and job involvement of the employee has a significant impact on their intention to quit. Additionally, the results show that intrinsic motivation is a more significant factor in employee retention than job involvement. Attracting and retaining highly skilled and talented employees allows organizations to improve efficiency and production, supporting the supply chain.

Motivating Employee performance

According to Rehman and Ali (2013), incentive compensation is an essential tool for firms attempting to improve the performance of employees. Considerably, when designed well, the incentive plans play a vital role in motivating employees to work harder, smarter, and better align the organization’s objectives. Over the past few years, there has been an increasing trend of pay for performance practices. The pay for performance consists of two components; the variable and fixed component. There has been an increased usage of variable pay approaches that show how employees are giving attention to performance-based pay.

Pay for performance influences employee attitude, which is linked to performance. Harrell-Cook, Levitt, and Grimm (2017) argue that the workplace attitude influences the creativity and innovation of employees, which impacts the overall performance. Employees that work with a positive attitude are likely to offer helpful suggestions and ideas that promote the growth and performance of an organization. Employee attitude is a critical factor in employee productivity due to its influence on performance. Employees who have the most positive attitudes also often showed higher productivity levels than those with less positive attitudes. For instance, employees working within the pay for positive performance attitudes, which improve their efforts. Often they are found increasing their performance during certain periods to gain extra money. This control enables them to have more power to boost their standing in the workplace. Therefore, they have a better chance of meeting their targets, thus improving performance.

Lucifora (2015) states that most firms offer employees’ remuneration package associated with paying for performance as a way of motivating employees. Pay for performance has reduced absenteeism and turnover, thus boosting performance. However, the effects of pay for performance on productivity depend on the scheme relied on (group or individual performance). Individual incentives have been demonstrated to have greater impacts as compared to team incentives. For instance, pay for performance offers employees immediate feedback on their performance based on their production units, which reinforces their performance. With regards to the studies, pay for performance is a positive reinforcement that motivates the employees. Motivated employees are more engaged, committed, and productive, which leads to more work production, thus supporting the supply chain. Ideally, good performance supports the supply chain achievement, which requires strategies that will reinforce performance, such as pay for performance.

Conclusion

Pay for performance allows companies to pay the employee based on their performance. The performance-based strategy has proven its effectiveness and reliability over the years. Multiple studies have purposed to explore the significance of pay for performance programs. The studies above have shown that pay for performance plays an essential role in motivating employees, improving productivity, and increasing attraction and retention. These variables are important in boosting work production in firms and supporting supply chain management. As a value-based system, pay for performance enables employees to boost their efforts which translates to improved work production, thus supporting the supply chain.

References

Green, C., & Heywood, J. S. (2008). Does performance pay increase job satisfaction?. Economica, 75(300), 710-728.

Harrell-Cook, G., Levitt, K., & Grimm, J. (2017). From Engagement to Commitment: A New Perspective on the Employee Attitude-Firm Performance Relationship. International Leadership Journal, 9(1).

He, W., Li, S. L., Feng, J., Zhang, G., & Sturman, M. C. (2021). When does pay for performance motivate employee helping behavior? The contextual influence of performance subjectivity. Academy of Management Journal, 64(1), 293-326.

Idowu, A. (2017). Effectiveness of performance appraisal system and its effect on employee motivation. Nile Journal of Business and Economics, 3(5), 15-39.

Iqbal, S., Tian, H., Akhtar, S., & Sohu, J. (2019). Impacts of Performance-based Pay on Employee Productivity; Mediated by Employee Training. International Journal of Research and Review, 6(10), 235-241.

Lazear, E. P. (2018). Compensation and Incentives in the Workplace. Journal of Economic Perspectives, 32(3), 195-214.

Lucifora, C. (2015). Performance-related pay and labor productivity. IZA World of Labor.

Mgedezi, S., Toga, R., & Mjoli, T. (2014). Intrinsic motivation and job involvement on employee retention: Case study-A selection of eastern cape government departments. Mediterranean Journal of Social Sciences, 5(20), 2119-2119.

Mujtaba, B. G., & Shuaib, S. (2010). An equitable total rewards approach to pay for performance management. Journal of Management Policy and Practice, 11(4), 11-121.

Ogbonnaya, C., Daniels, K., & Nielsen, K. (2017). How incentive pay affects employee engagement, satisfaction, and trust. Harvard Business Review.

Rehman, R., & Ali, M. A. (2013). Is pay for performance the best incentive for employees?. Journal of Emerging Trends in Economics and Management Sciences, 4(6), 512-514.

Ren, T., Fang, R., & Yang, Z. (2017). The impact of pay-for-performance perception and pay level satisfaction on employee work attitudes and extra-role behaviors: An investigation of moderating effects. Journal of Chinese Human Resource Management.

Schlechter, A., Hung, A., & Bussin, M. (2014). Understanding talent attraction: The influence of financial rewards elements on perceived job attractiveness. SA Journal of Human Resource Management, 12(1), 13.

Shaw, J. D., & Mitra, A. (2017). The science of pay-for-performance systems: Six facts that all managers should know. WorldatWork Journal, 26(3), 19-27.

Uwimpuhwe, D., Mushabe, D., & Bally, K. S. (2018). The Influence of Compensation System on Employee Attraction And Retention. International Journal of Advanced Academic Research, 4(11), 91.