Section Four SUMMARY
This section has discussed the role of reward and development
systems in strategy implementation. Because performance
measures are necessary for assessment of employees’
contributions to the implementation of strategies, various
measurement approaches were discussed as antecedents to
reward and development systems. Management by objectives
was discussed along with graphic rating scales, narrative
descriptions of performance, behaviorally anchored rating
scales, behavior observation scales, and 360-degree feedback
systems. Additionally, the lack of performance evaluation at
executive levels was discussed. The absence of such formal
evaluation for executives was attributed to several unfounded
beliefs or myths. Suggestions were offered for increased
application of performance evaluation to executives.
Following the discussion of performance measurement,
reward systems were considered from a compensation
perspective. Traditional job-based pay systems were described,
and their inability to provide the flexibility needed for today’s
competitive environment was discussed. Because of
compensation’s critical role in new work systems, organizational
processes, and organizational structures, several innovative
compensation approaches were discussed. These approaches
included skill-based pay, which focuses on the individual as