Follow [This Headline] for more information about systems, processes, systems, positions, templates, plans, tools, cases, stories, books, copywriting, reports, skills, workplace, etc. Furbook’s 15 years of accumulation will be shared with you for free!

Follow [this headline] for more information about systems, processes, systems, positions, templates, plans, tools, cases, stories, books, copywriting, reports, skills, workplace and other content, Furbook 5 years of accumulation free of charge Share it with you!

Reading navigation →

01 Performance pay for direct production personnel

02 Performance pay for production management personnel

03 Performance pay for auxiliary production personnel

1. Performance pay for direct production personnel

The performance pay system is a wage system that pays employees based on their work performance. It is based on effective performance evaluation of employees, focusing on the "output" of work, and is a wage system that determines employee remuneration based on the employee's final actual labor results.

Front-line production employees are the direct creators of corporate benefits. Their performance-based pay design mainly includes two forms: piece-rate system and time-based system.

. Piece-rate wage design

The salary of direct production personnel generally adopts the piece-rate wage system. The piece-rate wage can be based on the complete piece-rate method and the compound piece-rate method. Generally, enterprises use the compound piece-rate method. The specific salary structure is as follows.

. Time wage system

The product structure of some enterprises is relatively complex and the process is not stable enough. At this time, it is not suitable to use piece rate wages to assess direct production personnel. Instead, they can use the time wage system for their position wages. The specific structure is as follows.

The hourly wage system is the most basic wage form. According to the time unit of calculation, it can be divided into hourly wage system, daily wage system, weekly wage system, monthly wage system and other specific forms.

. Bonus design for direct production personnel

Bonuses are an important supplement to employee wages and an important means of motivating employees. They are labor remuneration paid by enterprises to employees for their excess labor or outstanding labor performance. Bonuses can be effectively provided to production front-line personnel. To encourage them to work better, the following four principles should be paid attention to when designing bonuses.

(1)Fairness. Fairness is mainly reflected in the close integration of bonuses with the labor results of front-line employees. More bonuses will result in more bonuses, less bonuses will result in less bonuses, and no bonuses will be awarded if no bonuses are exceeded.

(2) difference. Differentiation means using different evaluation indicators and reward methods for excess labor of different natures. The reward results must accurately reflect the value of the excess labor created by front-line employees.

(3) Practicality. Practicality refers to focusing rewards on production work related to enterprise efficiency, in order to achieve the purpose of improving enterprise production efficiency.

(4) operability. Operability means that the reward conditions must be clear, specific and easy to measure.

2. Performance compensation for production management personnel

Production management personnel include production directors, production department managers and other middle and senior management personnel in production. It is difficult to measure their performance with certainty. Under normal circumstances, they adopt the general salary model, annual salary system or profit sharing system. .

. The general salary model for production managers

The general salary model for production managers is widely used in enterprises and generally includes the following five parts.

(1) Basic salary: It is in the form of cash, with a fixed amount, reflecting the value of the work or skills.

(2) Level/Benefits: Pay position allowances and other salaries according to the management level, and determine welfare measures.

(3) Seniority salary: Generally based on the time on the job, it is designed using the incremental method.

(4) Performance pay: Determine performance pay based on performance appraisal results.

(5) bonuses: including monthly bonuses, annual bonuses, special bonuses, etc., are comprehensive awards calculated based on the work performance of production management personnel through a series of indicators, or individual awards for special contributions in a certain area.

． Annual salary design for production management personnel

The annual salary system refers to a salary system that uses the enterprise's fiscal year as the time unit and calculates and issues wages based on the performance of the operator. Mainly suitable for salary design of managers and company senior staff.

(1) Characteristics of annual salary system. The

annual salary system has the following three characteristics, as detailed below.

1． Generally, one year is used as a production cycle of an enterprise, which can better reflect the work characteristics of managers

2. Directly linking managers' income to work performance enhances managers' sense of responsibility

3. Integrate business operators with business owners and adhere to the principles of benefit sharing and risk sharing

(2) The composition of the annual salary of production management personnel.

The annual salary of production management personnel varies depending on the actual situation of the enterprise. Its basic composition model is as follows.

Annual salary income = basic annual salary + benefit annual salary + incentive annual salary

Or, annual salary income = basic annual salary + benefit annual salary + long-term incentive + welfare allowance

(3) Basic annual salary design.

Basic annual salary refers to the fixed cash income paid by the company to employees on a monthly basis. The basic annual salary is a basic recognition of the employee's business knowledge, management ability, work ability, experience accumulation and job responsibilities. When

determines the basic annual salary, it should be determined based on the labor market price of the employee hired, taking into account factors such as the total assets of the enterprise in which he or she operates, the scale of sales revenue, and the status of the enterprise. There are two specific determination methods, as detailed below.

. Design of profit sharing system for production managers

The profit sharing system, also known as the profit dividend or labor dividend system, means that at the end of each year, the company first withdraws a portion of the company's total profit in proportion to form a "shared fund", and then determines the distribution based on the performance of the employees. Amount, labor income finally distributed in the form of dividends.

In the profit-sharing system, in addition to receiving their due wages, employees can also share a part of the profits created by the company according to a pre-set ratio, which can be achieved through year-end dividends, incentive equity, virtual shares, etc.

Under the profit-sharing system, profit dividends are not directly linked to the employees' labor results, but are related to the individual's salary income base or the number of stocks, virtual equity, etc. held. Each employee's bonus is closely related to the overall performance of his department and the company.

(1) The total amount and proportion of profit dividends are determined.

The total amount of labor dividends and its proportion are generally determined by the highest decision-making level of the enterprise, and are divided into "initial proportion" and "renewal proportion". The specific determination method is as follows.

labor dividend total and proportion description table

Method	Specific instructions
Determine based on market price	Determine based on market price, using the negotiated salary system, that is, the basic annual salary level is determined through negotiation between the salary fixer and the employee
Based on the basic salary ratio The design	is based on the basic requirements of the employees of this company. The salary ratio is used to design the operator's basic annual salary. The calculation method is as follows: ① Basic annual salary = basic salary of employees of the enterprise The operating results are linked to each other, so this part of the salary cannot be set too high, otherwise it may happen that even if there is a business error, the operator can still get a higher salary. This is not conducive to the incentive effect of the annual salary system and will also lead to The generation of internal employee dissatisfaction. (4) benefit annual salary design. Annual benefit salary, also known as risk annual salary, is the income paid to operators according to a pre-set calculation method based on the company's annual operating performance. It is an irregular salary. The annual benefit salary of operating managers is often based on the basic annual salary or the added value of economic benefits, and is calculated based on the company's excess profits. There are mainly two calculation methods: ① Annual benefit salary = basic salary × multiple × assessment indicator completion coefficient. ② Annual benefit salary = excess profit × proportional coefficient × assessment indicator completion coefficient.

type	description	proportion determination description	Remarks
First period Ratio	The dividend ratio determined in the year when the enterprise first establishes the dividend system	S=H×G/L, S is the first period labor dividend ratio ; H is the total labor dividend as a percentage of the total salary; G is the total annual salary; L is the total annual distributable profit	-
renewal ratio	In the years after the profit sharing system is established, the labor dividend ratio can remain unchanged	◎ The constant method means that after the initial proportion is determined, the proportion of labor dividends in total profits in subsequent years remains unchanged ◎ The progressive method means that the labor dividend proportion is increased by a certain proportion year by year ◎ Floating method It means that the ratio of labor dividends is not fixed and changes with the company's profits.	The dividend amount is commissioned from the company's profits according to a certain proportion. The more commonly used form is the floating dividend ratio: the profit obtained by the company reaches the predetermined "return on investment" After that, the remaining part is the bonus

(2) Employee dividend method.

After the total amount of labor dividends is determined, the distribution methods among employees include the following three methods, as detailed below.

Based on a fixed percentage of salary

This method is based on wages, and determines the number of dividends based on the grade and amount of wages, using dividends as a supplementary labor remuneration

Based on a progressive percentage of wages

In this method, the higher the wage level, so the Or the higher the labor bonus percentage

The progressive distribution method mainly plays the role of widening the wage level and stimulating employees to make more contributions.

According to the division of labor coefficient

According to the nature and characteristics of the job, the "labor dividend coefficient" for different positions is formulated, using the annual Divide the total amount of dividends by the total coefficient to find the standard dividend, then multiply it by the individual's labor dividend coefficient to get the dividend amount

3. Performance compensation of auxiliary production personnel

The auxiliary production personnel of the production department refer to the supervisors, professional and technical personnel of the production department Personnel who play a supporting role in production operations, such as personnel, material management personnel, production planning personnel, and general management and affairs personnel, have characteristics that make it unsuitable to assess their work performance. Therefore, the design of performance-based compensation for auxiliary production personnel is more complicated.

. Income structure of auxiliary production personnel

Income of auxiliary production personnel = basic salary + monthly performance salary + monthly bonus + year-end bonus + various welfare subsidies

Due to the different risk levels of personnel in different positions and the difficulty of quantitative assessment, their income The proportions of fixed and floating parts also differ.

． Basic salary design for auxiliary production personnel

The basic salary for auxiliary production personnel is based on the knowledge required for the position, the required operational and management skills and experience, the required familiar processes, work attitude, etc. , the basic salary of personnel in the same position and the same rank is the same.

. Performance pay design for auxiliary production personnel

Performance pay for auxiliary production personnel refers to variable pay calculated based on pre-set methods and performance results based on the performance appraisal of employees. It is mainly determined based on the following three aspects.

(1) The qualities required for the position include work attitude, execution ability, work discipline, communication and collaboration, etc.

(2) Work completion status, including completion status of work tasks and quality of completion of work tasks.

(3) Performance of job responsibilities, including participation in employee training, proposals and suggestions for the company, job satisfaction of relevant personnel, etc.

. Bonus welfare design for auxiliary production personnel

The bonus for auxiliary production personnel should include the following two parts.

(1) Monthly bonuses and annual bonuses are determined based on the employee's daily performance, completion of work tasks, contribution to the company and other factors.

(2) Special bonus, assessed based on employees' special contributions to the company's management improvements, technology improvements, product improvements, effectiveness suggestions, etc.

#Salary# #Production Department# #Performance#

This article was originally written by Furbook, and the copyright belongs to Furbook. You are welcome to forward it. Reprinting, plagiarism, and manuscript cleaning are prohibited. Infringement will be investigated.

How to get the full content of the Word and PDF versions of this material:

1. This resource number: 1143.

2. Follow + comment + forward, and then send a private message with "information".

For more relevant information, please click "Learn More" below.