Paying for Performance: A Guide to Compensation Management.

• Author: Weiss-Terbell, Harriette
• Position: Director Library

Peter T. Chingos, Editor

Published by John Wiley & Sons Inc., New York, 389 pages, $65.00

AS THE U.S. ECONOMY struggles for equilibrium and makes shaky attempts at rebound, we find ourselves living as never before with a high degree of uncertainty and ambiguity. Faced with the disappearance of what used to be fundamental anchor points, we seem to have lost our True North for navigating the business landscape. In this morass of geopolitical and market vagaries, we can point to few "flags in the sand," and often not so much as a "breadcrumb trail" for meeting today's operating challenges.

There are, however, even in these volatile times, certain management issues that remain constant. Paying for Performance: A Guide to Compensation Management (Second Edition) presents a collection of 19 chapters detailing the still persistent and critical subject of linking employee pay to actual performance in the workplace.

Revised from its 1997 original edition, and authored by noted executive compensation consultant Peter Chingos and 28 of his colleagues at Mercer Human Resource Consulting, the book is a handy reference guide to the technical, meat-and-potatoes issues encountered by many of Mercer's clients. Drawing upon their hands-on experience designing reward systems and processes, the unifying theme is best practices solutions to ever-recurring problems.

Although highly technical in presentation, the book's fundamental point of view is that a business's reward system must be referenced and operationalized in the context of investment in human capital, a critical driver in gaining competitive advantage and creating shareholder value. Philosophically, the intent is to take a "synergistic" approach, articulating that pay cannot be managed separate and apart from other elements of human capital management.

The thesis is that to be effective, reward programs must integrate pay, benefits, and career opportunities, recognizing the relationship between and among these several variables. While this is not at all a new concept -- compensation professionals have been thinking in terms of "total remuneration" for almost half a century -- this book does a careful and disciplined job of linking the concept to the real world by citing Mercer client "best practices" of high-performing companies. Each chapter offers a nuts and bolts "how to" guide for solving a wide range of problems in a myriad of settings. It covers the spectrum from designing competency-based...