1. External Factor : Environment / Intangibles Pertemuan 6 Matakuliah: L0074/Psikologi Industri dan Organisasi 2 Tahun: 2008

2. EXTERNAL FACTORS : ENVIRONMENT / INTANGIBLES Incentive Organizational System / Organization Capital

3. INCENTIVE PAY Along with wages and salaries, many organizations offer incentive pay – that is, pay specifically designed to energize, direct, or control employees’ behavior. Incentive pay is influential because the amount paid is linked to certain predefined behaviors or outcomes. Usually, these payments are in addition to wages and salaries.

4. PRINCIPLES OF EFFECTIVE INCENTIVE PAY PLANS Performance measures should be linked to organization’s goals. Employees should believe they can meet performance standards. Organization must give employees resources needed to meet goals. Employee should value rewards. Employee should believe reward system is fair. Plan should take into account that employees may ignore goals that are not rewarded.

5. INCENTIVE PAY FALL INTO THREE BROAD CATEGORIES Incentives linked to individual Incentives linked to group Incentives linked to organizational performance. The choice of incentive pay may affect not only the level of motivation, but also the kinds of employees who are attracted to and stay with the organization.

6. Pay for individual performance

7. PAY FOR GROUP PERFORMANCE

8. PAY FOR ORGANIZATIONAL PERFORMANCE

9. PROCESSES THAT MAKE INCENTIVES WORK PARTICIPATION IN DECISIONS COMMUNICATION

10. BALANCED SCORECARD Balanced scorecard  a combination of performance measures directed toward the company’s long and short-term goals and used as the basis for awarding incentive pay. Balanced Scorecard (BSC)  Strategy Map

11. PENGANTAR STRATEGY MAP An organization’s strategy describes how it intends to create value for its shareholders, customers, and citizens. An organization must measure the critical few parameters that represent its strategy for long-term value creation. BINA NUSANTARA11

12. STRATEGY MAPS

14. BINA NUSANTARA14 ORGANIZATION CAPITAL Organization capital  the ability of the organization to mobilize and sustain the process of change required to execute the strategy.

15. ORGANIZATION CAPITAL BUILT UPON FOUR COMPONENTS 1. Culture  awareness and internalization of the mission, vision, and core values needed to execute the strategy. 2. Leadership  availability of qualified leaders at all levels to mobilize the organization toward its strategy. 3. Alignment  individual, team, and departmental goals and incentives linked to attainment of strategic objectives. 4. Teamwork  knowledge with strategic potential shared throughout the organization.

16. HIGH PERFORMANCE WORK SYSTEM High performance work system  the best possible fit between  social system (people & how they interact) & technical system (equipment & processes). Cause : - the nature of the workforce & technology change - customers demanding high quality & customized products. - employee seeking flexible work arrangements. - employers looking for ways to tap people’s creativity & interpersonal skills.

17. ENABLERS Knowledge Workers  Knowledge Management Employee Empowerment Teamwork BINA NUSANTARA17

18. KNOWLEDGE WORKERS Knowledge workers  employees whose main contribution to the organization is specialized knowledge, such as knowledge of customers, a process, or a profession. As more organizations become knowledge-based, they must promote and capture learning at the level of employees, teams, and the overall organization. BINA NUSANTARA18

19. ORGANIZATIONAL CAPITAL FOR KNOWLEDGE WORKERS Organizational Knowledge Creation  Nonaka Learning Organization  Fifth Discipline theory  Senge BINA NUSANTARA19

20. EMPLOYEE EMPOWERMENT Employee empowerment means giving employees responsibility and authority to make decisions regarding all aspect of product development or customer service. Jobs must be designed so the employee have the necessary latitude for making a variety of decisions. Employee must be trained to exert their wider authority and use information resources Employee also need feedback to help them evaluate their success. Pay and other rewards should reflect employee’s authority. BINA NUSANTARA20

21. TEAMWORK To increase employee responsibility and control is to assign work to teams. Teamwork is the assignment of work to groups of employees with various skills who interact to assemble a product or provide a service. Technology is enabling teamwork through virtual teams. BINA NUSANTARA21

22. BINA NUSANTARA22 THE END