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1、TO MERIT OR NOT TO MERITCase Analysis of merit pay policy ofSamaritan Memorial HospitalHuang Yuqiao, Zou YanningLi Baoying, Lai Yuting, Liao WeiGuangdong University of Foreign Study 1Table of contentsExecutive summary .2Introduction.3About the hospital.3Merit pay identification.3Advantage and proble
2、m analysis.4Advantages analysis .4Problems analysis 4Suggestion .6Recommendation .7Personal merit pay .7Implementation .8Group merit pay .11Implementation .12Conclusion .13Reference list 14 2Executive summaryThis report gives a brief introduction of Samaritan Memorial Hospital and its Merit pay poli
3、cy, analyzes merit pays advantages for nurses and main problems in the hospitals implementation, supposes a personal merit pay mode which combine with personal merit and group merit , and then proposes 360feedback evaluation for personal appraisal and Balanced Scorecard approach for group appraisal
4、respectively ,as well as the implementation in the Hospital . The solutions made by this report are original and based on the case given and researches on line. 3Introduction About the hospital The Samaritan Memorial Hospital, is a community Hospital in Macon, Missouri. It has a number of 127 staff
5、nurses. In January 1993, the hospital implemented a formal performance appraisal program for its staff nurse, namely merit pay. The merit policy of the hospital got through two main phases:January1993 July 1995Nursing supervisors appraise employee performance annually and give the appraisal form to
6、the HR department.Base the annual raise of all nurses on the consumer price index for the hospitals metropolitan area.Merit pay identification Merit pay, also known as pay-for-performance, is defined as a raise in pay based on a set of criteria set by the employer. It is a generic term for any devic
7、e that adjusts salaries or provides compensation to reward higher levels of performance. 4Advantages and problem analysis Advantages for nurses Merit pay is an effective device in HR management and become more and more prevalent in profit and non-profit organizations. As to the memorial hospital, ad
8、opting a merit pay plan has many advantages for the hospital nurses. Give them the opportunity for increased earnings It is a recognition of personal value, and stimulates them to seek for self-development constantly. It makes the nursing work more competitive, interesting and challenging, and stimu
9、lates their working enthusiasm.Problems analysis Merit pay has numerous advantages, but the memorial hospitals merit pay implementation still encountered many problems. There are three main issues.51. Annual appraisal-long period 2. Supervisor is the only evaluator-unilateral view 3. Small different
10、ial among pay increase amounts- not enough to motivate performance at a higher level.In fact, merit pay is adopted by many companies, but the really succeed one is rare. Failure of merit pay implementation normally results from ambiguous standards, authoritarian planning, or arbitrary award determin
11、ations and budget limitations.The hospitals failures are all attributed to its failure in design and implementation of the merit pay system, for example, the period of the appraisal, the participants and the incentive standard are all not accurate. 6Suggestions To inspire the nurses working enthusia
12、sm and improve efficiency, the Memorial Hospital should design a fairly complete and coherent merit pay system based on their specific situation, then implement it flexibly and amend it constantly. The appraisal period shouldnt be too long, it is much more stimulating to appraise and pay monthly or
13、quarterly than annually. The evaluators must include the stakeholders or the relevant person but not just the supervisors to avoid one-sidedness and unfairness.The pay increase for nurses should be different, but the differential cannot be so wide that it may dampen ones enthusiasm.There are many th
14、e appraisal methods can be used , such as the 360feedback evaluation , critical incident method, Target Management method , Balanced Scorecard approach and so on.7Recommendation For the hospital, the pay system suppose including four aspects: basic pay+ personal merit salarygroup merit salarybenefit
15、sRemunerationPersonal merit pay Since the Memorial Hospitals appraisal which mostly depends on the supervisors may be one-sidedness ,so here we bring in the 360feedback evaluation for personal appraisal .The 360feedback evaluation is also so-called multiple-input approach to performance feedback. The participants include supervisors, peers, subordinates, customers and oneself. 8Implementation The implementation of the 360feedback evaluation consists o
