Advanced Remuneration and Performance: The O’Meara Electronics Company

Running head: ADVANCED REMUNERATION AND PERFORMANCE
Advanced Remuneration and Performance: The O’Meara Electronics Company
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Introduction
Remuneration can be defined as the extra money that is provided to any particular
employee by their employer for the extra services they have provided. This is not donation or
giving away. There are various complementary advantages for remuneration and also provide
high and famous remuneration mechanism (Shields et al. 2015). The fair remuneration
strategy is extremely important for any business and it provides motivation to both the
employee and the employer. There are significantly two types of rewards for the
remuneration. They can be both cash as well as non cash. The employment relationship
remains extremely effective and strong with this type of strategies.
The following essay outlines a brief discussion on the case study of The O’Meara
Electronics Company. This particular organization is an electronics organization and the
President of the organization has decided to implement new strategies for remuneration for
all of their staffs. The organization has decided to hire an HR consultant for this purpose.
This report will describe about the choice of the remuneration system as the HR consultant.
The position based and the person based remuneration systems will also be discussed here.
Remuneration System in the Case Study
The O’Meara Electronics Company is an electronics organization of Australia that is
been operating for more than 20 years and also has a good market share (Bertone and Witter
2015). More than 1000 staffs are working this reputed organization and the production
department comprises of ten teams with twelve members each. The main business of the
organization is in the subsidiaries of four countries and they have decided to expand their
business to the European countries. The President of this particular organization have decided
to bring out new remuneration management strategies in their business since he thinks that
their profitability is getting down and the market position is declining thoroughly (Ragin

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2014). Previously they have worked with the position-based remuneration strategy, however
now they have thought of person-based remuneration strategy. The forum of the Executive
Staff was eventually set up and all of the executive staffs attended. They decided to hire an
HR consultant for starting the person based strategy within the organization. They wanted to
develop a more systematic approach for identifying the issues and drawbacks that were
stopping them from reaching to the height of success (Ma, Pope and Xie 2014). This new
system would be helping the organization as well as all the employees. The system of
performance management was an all day forum and all staffs attended this forum. The major
organizational performance management is completely regarding customer contracts or
numbers and their approach is ad hoc (Bharadia et al. 2018). Each and every staff of the
organization performed the performance management system for the customers and finally
their performance was evaluated. The President mentioned that they had a zero tolerance
policy and whenever any faulty product was found, it directly impacted on the morale of the
staff and their performance. They decided to undertake different systems for rating and
feedback methods. Remuneration system was needed in this particular scenario, where the
employees, who would be performing really well, would be getting rewards for their jobs (C.
Harris and Daunt 2013). The employees would be extremely motivated in this case.
Position Based System
This is the most basic type of remuneration strategy that is undertaken by various
organizations. Position based system is also termed as the job based pay, where the extra
payment is made according to the position of the employee. For example if the person is the
chief executive officer of the organization, he would be getting much more pay than the
junior manager of that particular organization (Stachová, Stacho and Bartáková 2015). This is
known as the traditional structure of payment, where the jobs are always slotted into the
schedule of salary. Each and every position is solely assigned on a fixed range of

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remuneration and it also depends on the duties and responsibilities of the job. This type of
position based system eventually offers all the employees and staffs a predictive pay method
and thus making the entire system extremely easier (Kwenin, Muathe and Nzulwa 2013). The
reduction of discrimination in the pay scale is one of the most important advantages of the
position based system. The main problem with this particular system is that there is a little
room for the upward mobility payment. The employees of the organization, who do not have
any desire for promotion, get almost zero incentive for their work, even if they are working
really well. Frustration is again one of the major disadvantages in this type of position based
remuneration strategy (Terera and Ngirande 2014). The third important disadvantage of this
strategy is that it leads to major office politics as the employees feel that partiality is being
done with them.
The O’Meara Electronics Company previously had the system of position based
remuneration strategy in their organization. They used to pay their employees on the basis of
the position they are working and thus performance of the employees were not being
evaluated properly (Strohmeier 2013). This would again be brining frustration in the minds of
the workers and thus they thought of changing their strategy to the person based strategy.
Person Based System
The second type of remuneration strategy or system is the person based system. The
other name of this type of strategy is knowledge based, skills based or performance based
remuneration strategy. This is completely different form the position based system (Supanti,
Butcher and Fredline 2015). This type of remuneration strategy pays their employees, who
have set goals and objectives for learning new and innovative skills, acquired new
knowledge, performed really well and have gained utmost popularity amongst all of the
customers or clients. The self motivated and the ambitious employees usually prefer to go