Details

Case

Educator Copy

Lahore Ring Road Police: Introduction of Variable Incentive Plan

Muhammad Abdur Rahman Malik


INDUSTRY : Transportation, Traffic Management

AREA : HRM/OB

ORGANIZATION : Lahore Ring Road Authority (LRRA)

LENGTH : 17

LUMS No : 05-760-2014-1

PUBLICATION YEAR : 2014

DESCRIPTION

KEYWORDS:

Variable incentive plan,Key Performance Indicators,Appraisal and Rewards System,Motivation,Public Sector


DESCRIPTION:

The Lahore Ring Road Authority (LRRA) is a public sector organisation, under the provincial government of the Punjab. It is responsible for the construction, maintenance and operation of the Lahore Ring Road. The chairperson of LRRA, Rashid Mahmood, is a graduate in Public Administration from the US. He has studied the concepts of variable incentive plans based on Key Performance Indicators (KPIs), and is trying to apply these concepts to the Ring Road Police (RRP), in order to create a motivated and committed police force. He has taken the approval of the Chief Minister Punjab to give a special allowance to the wardens of the RRP, however he is thinking of converting this fixed allowance into a performance based incentive. Performance based variable incentive plan is a new concept which has been largely untested in the public sector. Rashid expects that it will generate a lot of criticism and resistance, thus, before announcing the proposed performance based incentive, he arranges a brainstorming session with his close colleagues. He wants to get their views about the proposed plan so that he can move forward towards getting the approval for this system.


LEARNING OBJECTIVES:

1) Emphasise the relationship between organisational goals and individual KPI's. 2) Demonstrate the process of developing infividual level KPI's. 3) Highlight the difficulties and hurdles that come during the designing of variable incentive plans. 4) Identify the unintended consequences of variable incentive plans. 5) Show how motivational theories can be used to make decisions in real-life situations.


SUBJECTS COVERED:

Human Resource Management, Organizational Behaviour