Individual-based pay systems often aim to achieve which of the following outcomes?

Individual-based pay systems are designed to reward employees based on their individual performance, skills, and contributions. This approach is aligned with achieving greater market competitiveness. By tying compensation to individual performance, organizations can motivate employees to excel in their roles, thereby attracting and retaining top talent. This, in turn, helps the organization maintain a competitive edge in the market.

When individual-based pay systems are implemented effectively, they can lead to increased productivity, innovation, and employee engagement, as employees feel that their efforts are recognized and rewarded. This creates a more motivated workforce that is keen on contributing to organizational goals and enhancing overall performance, which is crucial for staying competitive in today’s dynamic business environment.

In contrast, uniform pay does not provide incentives for individuals to perform at their best, enhancing collaboration among staff may not directly relate to individual performance pay, and eliminating performance evaluations would undermine the basis on which individual pay is determined, ultimately detracting from the purpose of such a system.