Human resource management practice I also available by michael armstrong

Part 

6

  Performance and Reward

362

lever for organizational transformation’ that 

appears so seductive in the writing of American 

commentators.

Trevor  (2011)  posed  the  question:  to  what  extent 

can pay be strategic? He claimed that rationalism 

is limited and pointed out that pay systems tend 

to be selected for their legitimacy (best practice as 

advocated by institutions such as the CIPD and by 

management  consultants)  rather  than  for  purely 

economic  reasons.  He  observed  (ibid:  35)  that: 

‘What is desired (approach), and what is intended 

(design),  may  not  be  reflected  in  what  is  achieved 

(operation).’ His research into the pay policies and 

practice of seven large consumer goods companies 

led to the following conclusions:

As a result of the gap between intended policy  

and achieved practice, between the espoused and 

the realized, pay within a number of the case 

companies does not fulfil the strategic objectives  

of motivating managerial, professional and 

technical employees to work harder. It does not 

engender commitment or loyalty as outcomes,  

nor does it equip management with the 

behavioural ‘lever’ promised by standard theory. 

Despite the best efforts of leading companies, and 

the rhetoric of their espoused pay practice, pay 

practice is operationally non-strategic. (ibid: 201)

However, it cannot be denied that to have a sense of 

purpose and direction is a good thing and, with all its 

limitations, this justifies a strategic approach to reward.