Questions Below Needing Answers — No Paper Format Just Answe

2 Questions Below Needing Answers No Paper Format Just Answers

Performance Standards

Performance standards are critically relevant for today’s knowledge-directed workers because they provide clear expectations, measure progress, and align individual performance with organizational goals. In knowledge-based roles, where outcomes can be complex and qualitative, well-defined standards help ensure consistent quality and facilitate objective evaluation. Implementing performance standards promotes accountability, enables targeted training, and encourages continuous improvement. They also support a strategic approach to compensation and benefits by linking rewards to measurable performance outcomes, thus fostering a culture of high performance. Such practices are essential in creating a competitive advantage, as organizations can differentiate themselves through high-performing employees who are motivated and clear about how their contributions impact organizational success. Furthermore, performance standards assist in attracting and retaining top talent by demonstrating a commitment to fairness and meritocracy, which are highly valued in competitive labor markets (Bacal, 2014; Armstrong & Taylor, 2014).

Performance Incentives

Short-term incentives, such as bonuses or commissions, are generally preferable when immediate performance results are desired, such as meeting quarterly sales targets or project deadlines. These incentives boost motivation and focus employees on specific, time-sensitive goals; they are particularly effective in environments where rapid performance improvements are needed to respond to market fluctuations or to achieve quick wins (Milkovich & Newman, 2021). Conversely, long-term incentives, including stock options or deferred compensation, are better suited for fostering sustained performance and aligning employee interests with long-term organizational success. They encourage commitment, loyalty, and strategic thinking over an extended period, which benefits organizations aiming for stable growth and innovation (Jensen & Meckling, 1976). While short-term incentives can sometimes encourage risky or narrow focus, long-term incentives promote behaviors that support the organization’s future trajectory. In many cases, a balanced mix of both types of incentives is optimal, as it motivates employees to achieve immediate results while also contributing to long-term organizational health and competitiveness (Kerr, 1975).

References

• Bacal, R. (2014). Performance Management: Putting Research into Action. American Society for Training & Development.
• Armstrong, M., & Taylor, S. (2014). Armstrong's Handbook of Human Resource Management Practice. Kogan Page.
• Milkovich, G. T., & Newman, J. M. (2021). Compensation. McGraw-Hill Education.
• Jensen, M. C., & Meckling, W. H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure. Journal of Financial Economics, 3(4), 305-360.
• Kerr, S. (1975). on the Folly of Rewarding A, While Hoping for B. Academy of Management Journal, 18(4), 769-783.