More and more, organizations are linking performance to compensation. This link, however, cannot effectively be established without the existence of sound performance management processes that are seen as fair and equitable.
Clear documentation of progress against performance expectations also allows proper recognition for a job well done. This can be provided a number of ways, i.e.: formal recognition events, informal public recognition or privately delivered feedback.
It is important also to note the benefits of a consistent process across the organization. A consistent process creates a sense of fairness and significantly increases job satisfaction. This is even more critical if compensation is linked to performance. Employees need to know that if an individual in one department is identified as a top performer and compensated accordingly, then an employee performing at the same level in another department will receive similar rewards.