Research by XpertHR revealed that British employers are failing to motivate their staff because they were offering performance-related pay awards that were too low in relation to increasing inflation and the overall cost of living.
The HR information source discovered that the average performance-related pay increase over the previous year was only 2.7 per cent whereas UK inflation rates are likely to hit five per cent in 2011, according to financial experts.
Such a low level of pay increase will not encourage employees to improve performance as the award is so slight that there is little room to differentiate between high and low performing members of staff.
Just over half of British businesses are likely to use financial rewards to recognise high performance, which is due to the current economic climate as firms are looking to cut overheads.
If done correctly, pay awards can improve the performance of an individual employee and boost organisational productivity as a whole because they encourage greater focus towards key business objectives.
Some businesses fail to formally examine how performance-related pay schemes influence productivity levels and this lack of evaluation reduces the success of such employee benefits as there is no way to measure their effectiveness.
Pay awards are most likely to have a positive effect on high performing employees although it has been discovered that average or poor performers are unlikely to respond to such rewards and they can even damage their productivity.
Performance-related pay awards can act as an excellent tool to improve the productivity of an individual employee but the success of these benefits ultimately depend on how they are put into practice across an organisation.
If an organisation is unsure how to implement pay awards, they should employ the services of performance improvement consulting professionals as these business experts understand how to boost productivity and employee morale.
Hiring management consultants is often essential for organisations that are looking to improve performance because these professionals can investigate business processes from a balanced and impartial viewpoint.
Consultants are adept at using proven business theory to evaluate how an organisation operates and educate managers how to enhance processes in order to improve customer service and productivity as a whole.
For example, systems thinking theory allows a business to understand how interacting with their organisation works from the consumer's perspective which enables managers to enhance customer experience.
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Himsworth Consultancy is a leading Management Consultancy firm of senior business and consultancy professionals that specialise in delivering world-class customer service improvements, Visit http://www.himsworthconsultancy.com/ for more information.
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