I selected Pfizer as a company to examine wanting to see if they had adopted a skilled-focused pay structure- a type of person-focused pay- for their production workforce. The hypothesis being that with the technology involved in pharmaceutical manufacturing it would be beneficial for Pfizer, and their employees, if they were trained in the production of a variety of Pfizer drugs versus specializing in just one type or a specific process. Supporting this position is recent evidence showing that companies in the manufacturing sector are adopting a skill-based pay structure.
“In one of the first comprehensive studies of skill-based pay plans, a management researcher at the University of Arkansas found that such plans are more successful and sustainable in manufacturing facilities than in service organizations. The research also revealed that support among supervisors and employees for the innovative plans consistently predicts their success and survival.”
Below is a link to the full article:
https://www.reliableplant.com/Read/3959/skill-based-pay-manufacturers
I came across an unexpected “twist” in my exploration on Pfizer’s adoption of a person-focused pay structure. The twist is why Pfizer should adopt a competency-based pay structure- another type of person-focused pay- for a different job group and reason. The position is that due to competitive threats, Pfizer should adopt a competency-based pay structure for their sales force. Many of Pfizer’s top sales performers top-out in earnings after 3 to 5 years with the company. Competitors then hire them away for higher compensation. Pfizer desires to lower the turn-over rate of high performing employees. Adopting a competency-based pay structure would encourage their sales force to acquire new skills and knowledge, allowing them to transfer within Pfizer to other functions or advancement into management. The goal is for these high performers to remain at Pfizer and develop life-long careers.*
Mark Blessington, of Mark Blessington, Inc. authored a case-study on this that can be found on his site: mark.blessington.com
I had not contemplated this benefit of a person-focused pay structure, but in this example for Pfizer it makes sense.
