Case studies at two leading Western Cape businesses have shown how Performance Based Remuneration Systems contributed towards growth and stability. Main lessons learnt by all:

NO TARGET = NO RESULT. NO MEASUREMENT = NO PERFORMANCE.

These two businesses not only achieved exceptional financial rewards and improved labour stability, they also received recognition from the Chamber of Business. The one nominated as a finalist in the Cape Chamber of Business’ Exporter of the Year competition. In the second case, the CEO and management team received the Business Person of the Year award.

AWCape’s CEO Henri Hattingh, who was the lead consultant in both cases, summarised the main factors that contributed to the successful turnarounds:

  • Understanding customer needs and anticipating future needs.
  • Ensuring that all employees knew the company objectives and became involved in the future planning of the company.
  • In both cases we created a strong culture for product and service quality.
  • We changed management style to supportive and participative.
  • We introduced a culture where shareholders were prepared to share wealth.

The above factors were important building blocks in business success. However, once Performance based Remuneration systems were introduced, the growth and stability were accelerated beyond expectation.

The basic principles of Performance based Remuneration systems we followed were:

  • Detailed Job Descriptions created for all staff members.
  • Measurement of success was defined for each job.
  • Performance ratings, including constructive feedback, were conducted on a regular basis.
  • Salary and Wage payments were structured according to the outcome of performance ratings. In the one case, a gainsharing scheme was productively introduced.
  • Financial rewards were scheduled on a regular basis.

Further guidelines for creating and maintaining the Performance based Remuneration systems in the two case studies were:

  • Use experienced consulting resources to create a Performance based Remuneration System.
  • Train facilitators to ensure equity between departments.
  • It is beneficial to use an outside party to audit.
  • Stand-alone systems on Excel spreadsheets are good for prototyping, but systems such as Sage 300 People HR & Payroll provide a structured base. By incorporating the payroll system, it ensures that information stored in the system, is always current and up to date.

AWCape is proud to announce that we now offer Performance based Remuneration Systems through Sage 300 People.