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The Paradox of Meritocracy (Solution: (in the test study) Process and…
The Paradox of Meritocracy
"Examined the relationship between the mertit based salary growth and promotions of those employees on the one hand, and their performance evaluations on the other....found that, over the long run, women and minorities received lower salary increases than white men with the same performance evaluation scores" (p.37)
"When managers believe their company is a meritocracy because of its formal evaluation and reward systems, chances are it isn't" (36).
It's easy to fall back into complacency; but because of this we can never know if we achieve this- it may be a frustrating goal.
"Did not find gender, race, or foreign nationality disparities in employee promotions or terminations, which are highly visible decisions....find such disparities with respect to merit-based pay...typically unobservable" (37).
Solution
: (in the test study) Process and Outcome Accountability and Transparency
Develop a performance reward committee
Members of the company recruited from different divisions
including: one HR pro., one exec., and a new full-time staff member in charge of "compiling, coding, and analyzing data on employee compensation" (p.38).
Formal process for assigning rewards based on employee evaluations
Senior managers have to justify this award
"Award committee granted authority to modify pay decisions made by senior managers"
Result:
"For merit-based pay rewards, I found significant reductions in gender, race, and foreign nationality gaps"
Recommendations
Executives should collect data/ obtain collected data on processes and decisions about new hires, starting salary, merit-based pay, promotions, etc. (p.38).
Once collected and coded, the company can analyze info. about demographic patterns with other variables being equal
Separate processes: different people should design and implement procedures for managers to use to make pay decisions (process accountability) than individuals who monitor and identify situations when managers are not making fair pay decisions. The existence of the latter individuals is important for outcome accountability.
Process, Outcomes, Audiences
Audiences: who is responsible and who knows the pay criteria, processes, and outcomes?
Make someone accountable for making judgements