The impact of an outcomes based remuneration scheme on performance in the financial sector

Abstract

This mini-dissertation investigates the influence that an outcome-based remuneration scheme can have on productivity in the financial sector. It focuses on four dimensions that were used to determine if productivity levels could be affected; all of these four dimensions could be linked back to the performance of the employee and employer. The four dimensions were units produced, overtime, absenteeism and till cash up which speaks to the quality of transactions that were processed. When these four dimensions were tested statistically the results tended to suggest that there is a positive association with productivity and an outcome-based remuneration scheme. This simply means that an outcome-based remuneration scheme increases productivity levels in the workplace, more specifically in the financial sector; the literature review also supports this statement. The study also deals briefly with the advantages and disadvantages of a pay for performance scheme as well as when designing a pay for performance scheme what are the key design elements. It also briefly touches on the implementation of such a scheme, whether pay for performance is sustainable over a period of time and what are the most common types of pay for performance schemes.