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How Does Performance Related Pay (PRP) Work?

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Performance Related Pay (PRP) is not a new phenomenon as Beaumont points out, “it is important to recognize that “Performance Related Pay” is a very heterogeneous set of measures, some of which have been around for a very long time” (Beaumont 1993). Many variations like as work, payment by outputs, merit based merit-selective bonus schemes can be categorized under this.

“Merit pay systems are defined as those providing periodic increases in pay, which result from assessments of individual performance and personal value to the organization” (Murlis & Wright, 1993). “PRP is taken to mean individualized pay where movements in pay are determined in relation to individual performance against agreed targets” (Palmer, 1992). “Most of the recent debate has concerned Performance Related Pay (sometimes known as merit pay) the general principles of which are usually defined as the explicit link of financial reward to an individual, group or company performance (or any combination of these)” (Pilbeam 1995).

It appears from these definitions that although PRP may be considered a broad or a general term, the interpretation can be refined, and a working definition for the purpose of this dissertation is as follows: – Individual PRP has a straight association of payment within the contract of employment to an appraisal of performance based on the apparent contribution of an employee to its organization at one point in time.

Theoretical Basis for Performance Related Pay (PRP)

The fundamental theoretical basis for PRP is motivation theory. Kessler and Purcell spell this out, “The defining characteristic of PRP schemes is the attempt to link pay directly to individual performance and in this respect, underlying motivational theories come to the fore”. (Kessler and Purcell, 1992)

Other theoretical derivations, which have been discussed in previous chapters for PRP, consist of Expectancy, Reinforcement, Goal, and Equity theories. Equity Theory is based on the notion that employees want to be treated neutrally in relation to others. The theory attempts to enumerate ratios based on what an employee inputs in a job, and the overall benefits that the employee gets.

The suggestion is that some degree, perhaps at a subliminal level, of cognitive calculus, takes place which relates the ratio of inputs to outputs to the ratio of a ‘comparison other’. The individual verdict of the evenhandedness of the ratio relationships will largely decide the perception of equity, i.e. if it exists or not. The corollary is that perceptions of equity will maintain stability and symmetry. Perceptions of discrepancy will create a drive to take action on either your inputs or outputs or take action on the inputs or outputs of the ‘comparison other’. Alternative propensity in cases of apparent inequality includes perceptual distortion or even exiting from the unfair situation. Evidently, the degree to which equality or inequality is perceived to be present is puzzling with prejudice and a major contingency aspect is a degree to which a person values the notion of fairness.

However, the fundamental message in regards to reward systems is that of linkage of pay, as an upshot, to effort, aptitude and litheness as an input, can serve to accomplish fairness and preserve levels of motivation or not de-motivate. The linkage with PRP being that there must be a fair relationship between pay and performance.

Expectancy theory also has the capability to offer insights. Kessler and Purcell make reference to the collection of expectancy theories, although with immediate concerns. “… at the crudest of levels such (PRP) schemes are informed by the view that employees will be motivated if they perceive a direct relationship between effort and reward”. (Kessler and Purcell, 1992)

Emergence of Performance Related Pay (PRP)

Some of the current interest in PRP according to Beardwell and Holden in Human Resource Management – a contemporary perspective, is credited to competition; “due to competitive pressures organisations are constantly looking to augment the added value of their employees, by motivating them to increase effort and performance (Beardwell and Holden, 2004).

The strengthening and globalization of the competitive atmosphere being witnessed actually produce stronger interest in raising effort and performance. Many employers believed that their old, rather practical pay systems, to be too rigid, to meet the demands of a competitive market.

Personal performance was a rudimentary concern and PRP was perceived as an effectual method to put a performance message in an employee’s pay. The postulation being that PRP is quite influential in producing a cultural change which is very performance conscious.  Robinson, in Human Resources, comments on this, “instead of the previous paternalistic approach to employees whereby people were valued and nurtured regardless of their contribution, it put every individual’s performance firmly on the agenda” (Robinson, 1996). Yet, the competitive demand driver is only one of a number of interconnected stimulants to PRP enthusiasm. Others include the strategic incorporation of reward systems and the surfacing of HRM (Lewis,1991).

 

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US Group donates books to Ilocos Norte State University, Philippines: PNA

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The San Diego County Metropolitan Lions Club (SDC-MLC) in San Diego, California donated on Monday a total of 364 books of various titles to the Mariano Marcos State University (MMSU) here to be used by its students and the Department of Education (DepEd).

The books were received by the University Library System (ULS) through a shipment package sent by Leo and Norma Sicat, president and Lion Tamer of SDC-MLC, respectively.

The package consisted of five titles in Geometry, Algebra 1 and 2, Milestones, Milestone Workbook, Milestone Teacher Education, Great Expectation, George Washington, Tale of Two Cities, Eleanor Roosevelt, The Meeting on Board HMS Bounty, The Three Musketeers, The Prince and the Pauper, Clara Barton, and The Man in the Iron Mask.

MMSU President Shirley C. Agrupis said that while the university took custody of the hard-bound donations, it will also donate some of these to the DepEd-Division Office in the City of Batac.

MMSU-ULS director Eliza Villarin said some of the books will be distributed to the MMSU main library and its satellite libraries in Laoag City, various high school campus libraries, and college reading centers.

Villarin said organizations and agencies that donate books to the university are considered as library friends because they help the university strengthen its collection of information resources for its students.

The book donation was the result of a tie-up between MMSU and the SDC-MLC in July 2019 through a signed memorandum of understanding which stipulates that the SDC-MLC will help augment the university’s learning resources and support its internationalization programs.

The MMSU and SDC-MLC also agreed to conduct humanitarian medical, dental and optical missions in various communities, and enhance the extension service competencies of MMSU’s faculty and staff.

Philippines News Agency

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Education

Jio Institute – Mukesh Ambani’s ‘Institute of Eminence’ To Revolutionize Indian Education System

Jio Institute, which will be located in Navi Mumbai was to hire university staff and complete the academic curriculum by October this year, however, experts believe that things might get delayed due to coronavirus

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Jio Insitute, Mukesh Ambani’s ambitious institute for reshaping the Indian education system is expected to commence operation in 2021. Will the ‘Institute of Eminence’ – Jio Institute get impacted by Covid-19 is uncertain for now.

Jio Institute – Overview

The Shailesh Kumar led Jio Insitute will start its academic session in 2021. Numerous undergraduate courses will on offer including courses in emerging technologies like artificial intelligence, data sciences machine learning, digital media and marketing.

It is also expected that Mulhern of Northwestern University will be facilitating the Marketing Communication program while Kumar would teach Artificial Intelligence courses. The modern Jio Digital Library project will be headed by Keller from Stanford.

Jio Institute of Eminence

Jio institute has also set up a seven-member global advisory board. According to media reports, the board will consist of Jean-Lou Chameau, president emeritus of California Institute of Technology (Caltech); Michael Keller, vice provost of Stanford University; Rick Levin, former president of Yale University; Subra Suresh, president of Singapore’s Nanyang Technology University. Nadhmi A Al-Nasr, CEO of Saudi Arabia’s futuristic habitat project NEOM; Frank J Mulhem and Vinayak P Dravis of Northwestern University.

Mukesh Ambani, his wife Nita and daughter Isha will also be on the advisory board. The institute is one of the institutes in the country to be awarded the tag of ‘eminence’ by the Human Resource Ministry even before its completions.

Experts at EurAsian Times believe that the tag of ‘eminence’ was given due to the future prospects of the Institute. As of August 2019, ten institutions have been selected by the Institutes of Eminence, which includes Banaras Hindu Univesity, Indian Institute of Science, Indian Institute of Technology (IIT) Bombay, IIT Delhi, IIT Kharagpur, IIT Madras, University of Delhi, University of Hyderabad, Anna University and Jadavpur University.

Jio Institute Location & Key Details

Jio Institute, which will be located in Navi Mumbai was to hire university staff and complete the academic curriculum by October this year, however, experts believe that things might get delayed.

Students at Jio institute would not only get an opportunity to study at the sprawling 800 acres campus in Navi Mumbai but could also be taught by professors from prominent universities across the world.

The advance studies at the institute will also provide merit-based scholarships worth 38 crores during the first academic year.

Mukesh Ambani aims to make Jio University ranked in top 500 on Times Higher Education and QS World University Rankings. To achieve this feat Jio Institute is in talks universities like Massachusetts Institute of Technology (MIT) Stanford University, Northwestern University and Nanyang Technological University and aims to recruit expert faculty and mentors for the institute.

Reliance Jio and the Telecom Revolution

Reliance Jio Infocomm Ltd popularly known as Jio in India is a mobile network operator owned by Reliance industries. Jio was the brainchild of Mukesh Ambani and was launched in 2015 in honour of the 83rd birth anniversary of Dhirubhai Ambani, the founder of Reliance Industries.

Since its launch, the network has become immensely popular with Indians as it made internet accessible and affordable. The introduction of Jio revolutionised the telecom industry and made 4G data available pan-India at the lowest rate in the world. Jio Platforms compares with large global digital ecosystem platforms that are largely debt-free like Alphabet, Tencent and Alibaba.

Success at home has caught the eye of investors abroad. With 5 confirmed deals in May and another investment incoming, Jio is now valued at over $65 billion. The investors, all based in the US, include social media giant Facebook, private equity firm Silver Lake, Global investment company Vista, American private equity firm General Atlantic and US-based private equity company KKR.

Collectively, all the deals are worth $10.3 billion or Rs 78,562 crore, which RIL plans to use in order to pay off $44 billion worth of its debt.

Microsoft, the tech giant founded by Bill Gates, is also in talks with Jio to purchase a 2.5% stake at the cost of $2 billion. Abu Dhabi state fund Mubadala, another investment company, is also in talks to invest about $1 billion in Jio platforms.

Within a short span, Mukesh Ambani and Jio have achieved what other companies have not been able to for decades. With the establishment of Jio Institute, India’s most influential businessman has ensured that the company he birthed would be looked after by Jio’s very own.

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MBA vs PGDM: Why MBA Degree Is Better Than AICTE PGDM?

MBA vs PGDM: Experts from PGDM Colleges call MBA programs Outdated, while MBA colleges call PGDM program a mere Diploma. An MDI Gurgaon Alumni explains why MBA is Better than a PGDM.

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MBA vs PGDM is an ongoing debate, but what is the difference between MBA and PGDM and which is a better program between the two remains a big question for aspiring management students.

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Students aspiring to get into Top Business School are searching for the best pathway to achieve their goals. As the entrance season advances, the dilemma for the management aspirants continues – MBA vs PGDM and which Business School to opt for?

EurAsian Times analyses the difference between the two programs and analyses why an MBA Degree could have more advantages that a PGDM Program.

The confusion to select a PGDM or MBA course reaches the peak when the students start visiting the colleges for counselling and GD/PI sessions. All business schools boast about their Excellent Placements Record, Faculty from the IIM’s and IIT’s, International Exposure, etc leaving the management aspirant in a total state of confusion.

What adds to the confusion level are the Education Consultants who further confuse the students for their petty monetary gains. At some point in time, students get so frustrated that they stop taking all the calls for admissions. EurAsian Times crisply attempts to explain the difference between MBA and PGDM.

Which Are The Best Business Schools in Delhi, NCR For Placements Under The AICTE?

MBA vs PGDM: What’s the Difference?

Master’s in Business Administration (MBA) is a degree course provided by the University or colleges recognized by the Universities which are approved by University Grants Commission (UGC), and sometimes also by All India Council for Technical Education (AICTE).

Post Graduate Diploma in Management (PGDM) is also a Masters’s degree program, offered by the autonomous institute or colleges, that have received their approvals from the All India Council for Technical Education (AICTE).

Some of the top business schools like IIM’s and ISB’s offer PGDM / PGPM program (and strangely they are not approved by the AICTE) as they do not have collaboration with any University. But these B-Schools have an outstanding placement record and great international reputation and do not bother about AICTE approvals. Neither do the organizations show any concern or preference.

China and India Dominate the List of Best Business Schools in Asia

Colleges offering the MBA program follow the academic syllabus provided by Universities (which usually cannot be easily modified or changed) while PGDM syllabus is flexible and institutes like IMT, MDI, XLRI, IIFT, SP Jain, NMIMS have the flexibility to modify their course within the AICTE approved parameters giving them a tremendous advantage.

Which Program is Better – MBA or PGDM?

MBA vs PGDM is an unending debate and honestly, a lot depends on which University or College a student is getting (based on entrance exam score like CAT / XAT / MAT etc) rather than the program itself i.e. MBA or PGDM. The PGDM program claims to follow a more practical approach to studies, compared to the MBA (which is not always true).

MBA from top institutions like FMS, IIT, DTU are equally acceptable and sought after in the market. The major difference between MBA and PGDM is that MBA course fee is usually less than the PGDM program, as PGDM comes with a variety of industrial trips, international exposure programs, besides being a revenue generation model for the institutions. (A PGDM Program at the IIM’s could cost up to 28 Lacs, whereas MBA from FMS-Delhi University would only cost about 2 Lacs).

Best Business Schools in India: Check If Your B-School Is Duping You?

Corporates recognize talent from both the programs and are more interested in better brands and students, and don’t really care about MBA or PGDM. Students have an apprehension that after PGDM, they would not be able to pursue higher studies like PhD but if a PGDM is AIU approved, students will be eligible for PhD programs as well.

However, be assured that having a PGDM Degree instead of MBA degree will not make any difference to your corporate career in India, as at the end, it is the student who matters!.

SP Jain Himself Reviews Global MBA / Executive MBA Program @ SP Jain School Of Global Management

The students need to be very clear about their choice of the PGDM or MBA program and institute they are opting for. Students must evaluate the brand of business school, as a business school with higher brand value will provide a good learning environment and a large network of alumni.

MBA vs PGDM: Which is Finally Better?

Both the programs i.e. MBA and PGDM are good and very similar. What matters most is the business school you are getting, based on your score. Which Business School would you choose – MBA from FMS-Delhi University or PGDM from IIM-Lucknow?

Better ROI: If I had to make a choice, I would certainly choose FMS-DU as the fee is drastically less than IIM-Lucknow and return on investment is much much faster. However, there is a dearth of top-notch Universities providing MBA Programs, and students have no option but to opt for expensive PGDM programs.

Government Jobs in India: Besides the corporate sector, many government organizations still, unfortunately, do not recognize the PGDM Diploma and Government Jobs is one area where MBA Degree holders will have an edge over others.

International Jobs: If you ever opt for immigration or overseas opportunities, chances are your PGDM will either not be recognized or valued as high as an MBA Degree. Even the IIM’s have been striving to provide MBA programs rather than Diplomas and once that happens, the PGDM programs will lose the sheen and colleges would lose massive business.

AIU Approved PGDM Colleges – How Vital is the AIU Approval For PGDM Institutes In India?

 

 

Key Differences Between MBA and PGDM

Parameter
MBA from Govt. University
MBA from Private University
Indian Institutes of Management (IIMs)
Private PGDM Colleges
Programme offered
Masters of Business Administration
Masters of Business Administration
Post Graduate Programme in Management(PGP)
Post Graduate Diploma in Management (PGDM)
Award
Degree
Degree
Diploma
Diploma
Number of programme offering institutes
2000+
500
20
500
Top Institutes/colleges
FMS – Delhi University; IIFT Delhi-Deemed University; JBIMS – Mumbai University; PUMBA-Pune University
Affiliated colleges of Govt Universities like Anna University, Bangalore University etc.
Top Private Universities are NMIMS-Mumbai; Symbiosis –Pune; XIM-XUB Bhubaneswar.
More than 100 Private Universities offer MBA
IIM Ahmedabad, IIM Bangalore, IIM Calcutta, IIM Lucknow, IIM Indore, IIM Kozhikode and other 14 new and newest IIMs
XLRI, SPJIMR, MDI, IMI, IMT, TAPMI, KJ Somaiya, BIMTECH, …
Degree/Diploma recognized/approved by
University Grants Commission (UGC)
University Grants Commission (UGC)
Recognized by Ministry of HRD
All India Council for Technical Education (AICTE)
Curriculum
Rigid, because approvals required from University
The curriculum at most Government Universities and Colleges is theoretical, and not frequently updated.
The curriculum at good Private Universities like NMIMS and Symbiosis is at Par with IIMs, top PGDM B-schools.
Flexible and Frequently Updated.
Focus on Industry needs and job requirements as Placement is key student expectation.
Flexible and Frequently Updated.
Focus on Industry needs and job requirements as Placement is key student expectation.
Programme suitable for
MBA offered by Government Universities is more suitable for candidates interested in earning a Degree for higher studies, academic career.
MBA offered by top Private Universities is good for both corporate career and academics.
Students focus on enhancing their employability skills for a better corporate career, job or starting their own enterprise.
Students focus on enhancing their employability skills for a better corporate career, job or starting their own enterprise.
Fee
Fee at Government University/Colleges is low. FMS Delhi fee is just Rs 25,000 for the full MBA course.
Bangalore University prescribes 2-year fee of fewer than 200,000 lakhs.
Private University MBA fee is at par with IIMs, PGDM B-schools based on their market acceptance.
NMIMS Mumbai fee is Rs. 17.44 lakhs; SIBM Pune fee is Rs. 18.25 lakhs
IIMs have a comparatively higher fee structure.
IIM Ahmedabad fee is Rs.21 lakhs, IIM Bangalore fee is Rs.19.5 lakhs, IIM Calcutta fee is Rs.19 lakhs.
Top PGDM B-schools charge between Rs 10 lakhs to Rs20 lakhs for 2 year MBA.
SPJIMR fee is Rs. 16 lakhs, MDI Gurgaon fee is Rs.18.89 lakhs, IMI New Delhi fee is Rs. 15.41 lakhs
Fee for many good PGDM B-schools is between Rs. 5-10 lakhs also.
Programme duration
Two years
Two years
Two years
Two years
Exam conducted by
University
University
By the Individual IIM
By individual College/
Institute
Admission Process & Entrance Test
Some Govt. Central Universities and their colleges accept National level entrance tests like CAT/XAT and/or also conduct their own entrance tests.
Most Government colleges governed by State Governments, admit thru state level examination like MAHCET, PGCET, TANCET, although these colleges.
Top Private Universities conduct their own exams like NMAT, SNAP, X-GMT
Common Admission Test (CAT) conducted by IIMs, is the mandatory entrance exam for Indian residents
B-schools can choose from one or many of 6 approved exams: CAT, XAT, CMAT, MAT, GMAT, ATMA

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