Strategic Human Resource Management: IPRP and Employee Performance

This essay provides a comprehensive analysis of Individual Performance Related Pay (IPRP) within the context of strategic Human Resource Management (HRM), specifically focusing on the British brand Waitrose. The introduction defines human resources and introduces the concept of IPRP as a system that links employee compensation to their performance. The main body critically evaluates the extent to which IPRP stimulates higher performance levels, considering both short-term incentives and long-term loyalty. It acknowledges the potential for increased productivity and employee retention but also addresses potential drawbacks such as discrimination and bias. The essay further examines the circumstances under which employees are motivated by IPRP, taking into account factors such as job type and individual differences. It highlights how IPRP can boost motivation and performance in certain situations, such as when employees seek higher earnings or career advancement. The conclusion summarizes the effectiveness and negative aspects of the IPRP system, emphasizing the need for organizations to effectively manage employee compensation and talent.

Strategic Human
Resource Management

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Introduction to Individual Performance Related Pay (IPRP).................................................3
Critically evaluate the extent to which Individual Performance Related Pay (IPRP) can
stimulate higher levels of performance from employees.......................................................4
Considering the circumstances in which employees are motivated and those in which they are
not with relation to Individual Performance Related Pay (IPRP)..........................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Human resource is a holistic term used for referring towards the people of a company
working in it and conducting the operations. The human resource is also addressed as workforce,
labour force, personnels, employees, workers and with other such synonyms referring to people
who are executing all the theoretical plans of management in the real practical scenarios and
working for gaining the pre determined results by fulfilling aims and objectives (Aktar and
Pangil, 2018). The essay is developed on Waitrose a British brand which is offering grocery
products by supermarkets and known to be largest employee owned retailing company. Waitrose
was founded in 1904 and it is located in London, United Kingdom. The essay acknowledges the
extent of performances standards of employees of company is related with IPRP a unique
payment system. Along with it, the essay covers the circumstances in which this system keeps
people motivated and in which it negatively affects them by evaluating few related factors.
MAIN BODY
Introduction to Individual Performance Related Pay (IPRP).
Individual Performance Related Pay (IPRP) or Performance Related Pay (PRP) is a
phenomena and a way by which human resource management team manages the payroll of staff
member by linking their salary progression with their performances and their contribution made
to the company in its goals. The performance related pay is aligned with the standards of
performances rendered by employees for completing the given tasks and these are most
commonly measures against pre agreed objectives and factors. It is said that Individual
Performance Related Pay (IPRP) is a heterogeneous approach which has many variations under
its head such as payment by output, merit based or merit selective bonuses and many other
(Boella and Goss-Turner, 2019).
Organisations with huge workforce applies Individual Performance Related Pay (IPRP)
phenomena for number of reasons and the most important one is to manage the relationship
between the level of performances employees are rendering to company with their rewards and
all the other extra benefits. This approach is used by management and human resource
department of organisations for multiple aspects but talent management and employee
motivation is the major factor which is considered. The Individual Performance Related Pay

(IPRP) system is applied on employees in association with the salary structure, performances and
last but not the least is grades and ratings that are procured by them through their competencies.
While applying the Individual Performance Related Pay (IPRP) the management of
Waitrose or the human resource department is responsible for evaluation of performances of staff
members. These performances are measures against the qualitative and quantitative measures for
collecting evident database and proceedings accordingly with the payments.
Critically evaluate the extent to which Individual Performance Related Pay (IPRP) can stimulate
higher levels of performance from employees.
Employee performances needs to be managed and evaluated regularly as it is directly
linked and impacting upon the overall performance of company and on its profitability.
Employees or the workforce are the pillars of an organisation supporting it in all situations and in
all aspects, risky, important, in case of any emergency and in profitable times as well for keeping
it in stable position. Therefore, in return company also have to support their personnels and their
well being. Performance management is an appropriate approach used for managing people
performance and Individual Performance Related Pay (IPRP) is a method to do so (Armstrong
and Taylor, 2020).
Individual Performance Related Pay (IPRP) is an potential system that enables the firm in
making appropriate arrangements and keep employees satisfied and render their best to the
organisation by performing beyond expectations. A organisation like Waitrose with huge
workforce in numbers and in such competitive environment needs to perform well. The
employees needs to be retained and the Human Resource Management have to take measures to
do so. Individual Performance Related Pay (IPRP) can help the firm in simulating higher
performances form employees on managerial and operational level for keeping the overall
functions run smoothly (Brewster Mayrhofer and Farndale, 2018).
The Individual Performance Related Pay (IPRP) has two summarised ways of
implementation or application in a respective organisation. The first is for Short Term that is on
temporary basis in which most often commissions and bonuses are used to reward staff and even
on the basis of their sales units of a particular period. The Human resource management of
Waitrose will apply this scheme of Performance Related Pay when they aim at providing
incentives to employees. Another scheme is for Long Term that is applied for fulfilling the aim
of gaining workforce loyalty and trust.

The system of Individual Performance Related Pay (IPRP) is very potential and
beneficial that is adopted by Human Resource Management of Waitrose for inducing the
performances of employees and for gaining other advantage as well. Some of them are:
The first and foremost effect of Individual Performance Related Pay (IPRP) to employee
performance is imposes by a very obvious reason of bulkier pay. Workers in Waitrose will be
paid more at the end of the month as the mechanism of Labour market becomes more flexible
and results in higher productivity and employment (Bailey, 2018).
It is evident and apparent that job offering Individual Performance Related Pay (IPRP) in
Waitrose attracts workers as the company deals in retail sector and sales matters of the firm
which implies that implementation of Individual Performance Related Pay (IPRP) in sales
department on the basis of per month sales will be attracting more workers and also enable in
retaining them as they will be receiving bulky pay at the end of the months.
The people in organisation and management gets to develop better relation with one
another and their bond gets stronger and healthier. The Individual Performance Related Pay
(IPRP) systems working playing a major role in it that is employees being paid on time and on
appropriate percentages on their monthly sales units. The Individual Performance Related Pay
(IPRP) can also impose negative influence and have potential of harmful damage in long run or
can serve the firm with short term results. This system can create discrimination and biasness in
the work environment (Crawshaw, Budhwar and Davis, 2020).
The scheme can be exploited and favouritism, nepotism and cronyism will be promoted
where friends, family member are being hired and promoted to higher positions creating a cluster
of people with similar interest and affects others in the company as well as the firm too. It is also
argued by professional that high bonuses of executives are linked to their bargaining power and
influence over the top management they are linked with their performances. This automatically
neglects the effective and proper use of Individual Performance Related Pay (IPRP) and it
certainly employees performances are also not considered while finalising and initiating
payments.
Considering the circumstances in which employees are motivated and those in which they are not
with relation to Individual Performance Related Pay (IPRP).
Motivation is a scientific phenomena and known as process which directs and guide
people to their certain goals and made them adopt goal or purpose oriented approach. Motivation

plays a vital role in day to day life of people as it make them put efforts and time in respective
work or task and do it in the most efficient manner which will allow them to attain their aims and
objectives either long or short term. Employee motivation is another factor playing vital role in
company's functioning and which will enable the organisation in attaining their goals and
objectives. Employees works for the organisational goals under multiple circumstances with the
motive of completing the assigned tasks in the given time and with the expected level of
performance quality and standards.
The employees needs to be kept satisfied, informed, engaged, happy and motivated for
obtaining the prescribed aims and objectives. Most often managers and top level executives
ignore the motivation factor while expecting higher performance standards and completion of
tasks in given prescribed time (Banfield, Kay and Royles, 2018). Waitrose is competing in a
saturated and aggressively competitive marketplace where leading international companies like
TESCO and WALMART is operating too. In such competitive situations company needs to keep
staff encouraged and satisfied which will induce their motivation levels and their willingness to
work will increase too.
Individual Performance Related Pay (IPRP) is a performance management and
inducement technique that is related with rewards, employee payments at the period end and
their performance. Varied circumstances and situations occurs in business world in which
organisations operates for their individual and unique aims. Those circumstances are faced and
managed by employees of the firm and for which their motivation level has to be high as it will
make them put their best efforts and work towards the specific short term or long term target.
There are factors associated with Individual Performance Related Pay (IPRP) system
which can put positive impacts or even negative impacts on motivation level of employees and
overall goal achievement. Individual Performance Related Pay (IPRP) is either applied for short
or for long term in the operations and pay system of company. The aim short term scheme is to
improve employees motivation and retain them for long term which works fine on temporary
basis (Haak-Saheem and Festing, 2020). There are situations in which employee motivation is
severely affected by the scheme of Individual Performance Related Pay (IPRP). Few of those
circumstances and factors are as follows:
 Type of occupation, is one factor which influence motivation of individuals as some
people are comfortable in their jobs and cherish what they do but some feel inferior and

do not stay satisfied with their job. Employees in Waitrose may feel inferior about their
job such as of being a sales person or executive. But in the same time if they are offered
higher pay based on their performances it will boost their willingness and motivate them
to work efficiently for inducing their sales units in order to earn higher pay at the end of
the month by application of Individual Performance Related Pay (IPRP) schemes and
systems. Their performances will be evaluated on the growth of their sales graph and
their month end pay will be proportionate to it (Barrena-Martínez, López-Fernández and
Romero-Fernández, 2019).
 Individual differences, reflects upon the uniqueness of a person, their behaviours and
attitudes which influences their motivation levels at work and in general day to day
situations. There are number of employees in Waitrose each has different motivating
factors that encourages them and keeps them work with full potentials. Individual
Performance Related Pay (IPRP) can be effective and can even fail in motivating
employees as some may have other aims than monetary one to be engaged in work. For
instance, one sales executives is financially struggling they will work more hard, perform
better for earning bulky pay at the end of the month. On the other side one has the
objective to become the best employee of the month in Waitrose and consequentially
move to higher positions. In such situations Individual Performance Related Pay (IPRP)
will either be efficient or will lead towards failure (Berman, 2019).
CONCLUSION
The discussion conducted in above essay over Individual Performance Related Pay
(IPRP) summarises the effectiveness and negative aspects both of the systems. Employees
retention and talent management is a necessary task for an organisation for maintaining their
competencies and for growth. Therefore, critical evaluation concludes that the company needs
this systems of effective payments to employees on regular basis in manner of rewards or
incentives and for long term it induces the loyalty of staff members. It is a temporary and a a
longer term approach which is suitable in situations such as for keeping staff motivated and
rewarding them regularly for short term basis and also enable the management of the respective
entity to retain staff for longer period.

REFERENCES
Books and Journals
Aktar, A. and Pangil, F., 2018. Mediating role of organizational commitment in the relationship
between human resource management practices and employee
engagement. International Journal of Sociology and Social Policy.
Armstrong, M. and Taylor, S., 2020. Armstrong's handbook of human resource management
practice. Kogan Page Publishers.
Bailey, C., and et. al., 2018. Strategic human resource management. Oxford University Press.
Banfield, P., Kay, R. and Royles, D., 2018. Introduction to human resource management. Oxford
University Press.
Barrena-Martínez, J., López-Fernández, M. and Romero-Fernández, P.M., 2019. Towards a
configuration of socially responsible human resource management policies and
practices: Findings from an academic consensus. The International Journal of Human
Resource Management. 30(17). pp.2544-2580.
Berman, E. M., and et. al., 2019. Human resource management in public service: Paradoxes,
processes, and problems. CQ Press.
Boella, M. J. and Goss-Turner, S., 2019. Human resource management in the hospitality
industry: A guide to best practice. Routledge.
Brewster, C., Mayrhofer, W. and Farndale, E. eds., 2018. Handbook of research on comparative
human resource management. Edward Elgar Publishing.
Crawshaw, J., Budhwar, P. and Davis, A. eds., 2020. Human resource management: Strategic
and international perspectives. SAGE Publications Limited.
Haak-Saheem, W. and Festing, M., 2020. Human resource management–a national business
system perspective. The International Journal of Human Resource
Management. 31(14). pp.1863-1890.
Online:
Performance-related pay, 2018. [Online] Available Through:
<https://www.perkbox.com/uk/resources/blog/a-controversial-guide-to-performance-
related-pay/>
Performance related pay (PRP) can help you motivate an under-performing workforce, but it can
also be a point of great tension, 2019. [Online] Available Through:
<https://croner.co.uk/resources/pay-benefits/employee-incentives/introducing-
performance-related-pay/>