Malakhova A.A., Starova O.V., Arefev V.A.Published in:
Russian Journal of Labor Economics
– Volume 7, Number 1 (January 2020)

JEL classification: J24, M12, M54

Keywords: assessment of personnel labour, employee's personal efficiency, key performance indicators, material motivation


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Abstract:

In this paper we study the evaluation of personnel and the results of its activity as a key factor in choosing the most optimal system of remuneration in personnel management. A critical analysis of the existing approaches to the construction of a differentiated system of remuneration from the point of view of the effectiveness of staff motivation, universality of the scope of application of the methods, taking into account the contribution of a particular employee to achieve a joint result, the objectivity of establishing criteria and assessing the employee's personal effectiveness, the complexity of the method in determining the level of remuneration is conducted. On the basis of these criteria, the evaluation of both widely used approaches to the construction of a differentiated wage system (grading, KPI) and less studied systems (SPB, PFP) was carried out. It is recommended to supplement the construction of a differentiated remuneration system with the "5+" method, which allows to assess the employee's personal efficiency. This system can be considered as an independent approach to the construction of a differentiated wage system, and complement the KPI indicators. In conclusion recommendations on the choice of appropriate systems from the point of view of personnel management efficiency are given.

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