Xcel Energy Pays for Employees Who Excel

Running head: CASE

Xcel Energy Pays For Employees Who Excel

Jasmine J. Jenkins

Kaplan University

AB203: Human Resources Management

Henry Lehne

May 8, 2012

Xcel Energy Pays For Employees Who Excel

Introduction

Motivating employees can be done in a lot of ways, some are more expensive than others but all are quite effective. As long as you are willing to invest time and/ or resources you can start motivating employees. The most common way of motivating employees is giving them an incentive, the famous saying “Do more work and you will get more rewards” seems to hold true. According to Wikipedia “Merit pay is a term describing performance-related pay, most frequently in the context of educational reform. It provides bonuses for workers who perform their jobs effectively, according to measurable criteria.” Many company use merit pay in order to motivate their employees.

Review/Analysis of the Case

Merit pay helps an employer make a distinction between the performances of high and low performing employees and reward the performance of the higher performers. It also provides a way for an employer to recognize individual performance on a one time basis. I believe that this will support Xcel’s strategy a lot more. Even with the limitations that exist in the awarding of merit pay, it is their best opportunity to ensure that the outstanding performers remain with their and continue to make their contributions. This is guaranteed to “send a signal about how you can be rewarded if you’re a performer.” (Noe, Hollenbeck, Gerhart, & Wright, 2009).

Xcel could use the recognition method to encourage employee’s suggestions. Recognition is the cheaper way to motivating employees but is just as effective as incentives. Recognition as the word implies involves recognizing and appreciating an employee's performance. The more suggestions an employee provides to the company, comes more recognition from management. Each employee has his or her own...