Martinez, Aleen Rea A.

February 24, 2017 MBA 211 A

Pay for Performance Enhances Employee Management at Scripps Health

Question and Answer

1. Discuss how this case illustrates how compensation can be used as a method for improving
employee satisfaction and motivation.

This case illustrates how compensation can be used as a method for improving employee
satisfaction and motivation because Scripps Health used compensation to do just that. Scripps
Health reorganized their compensation polices of their organization. Part of this process
involved periodic reviews of job content and the use of annual appraisals to enhance
communication. They also used assessments of experience and education to properly adjust
compensation amounts. Nevertheless, the organization strives to offer competitive
compensation that rests at the 65th percentile of the relevant labour markets, which positions
the firm squarely in the middle between the top and bottom levels of competitive
compensation levels.

2. Identify some of the ways that performance-based pay systems should be developed based
on the experience at Scripps Health?

Based on the experiences at Scripps Health performance based pay systems should be
developed by ratings given annually by performance appraisal sessions. If employees do well
on their performance reviews, they can earn as much of 5% of their salaries as merit-based
compensation at Scripps.