ACCA Strategic Professional · Advanced Performance Management · Non-financial performance measurement
Orlin Logistics uses the Building Block Model to design a performance system. Its directors have set the standards for each measure, but drivers complain that targets are imposed without discussion and that there is no link between hitting targets and pay. Which building block requirement is Orlin failing to meet?
Orlin is failing the rewards and standards blocks. The Building Block Model requires targets that are achievable, fair and owned by staff through participation, and rewards that are clear and motivating. Imposed targets with no link to pay breach those requirements.
- ADimensions, because no measures of innovation exist
- BRewards, because standards must be achievable, owned by staff, and fair, with clarity and motivationCorrect
- CStandards, because they should always be set at the industry-leading level
- DResults, because competitiveness has not been measured
Explanation
The standards and rewards blocks require targets to be achievable, owned through participation, and fair, and rewards should be clear and motivating. Orlin's imposed targets and missing pay link breach ownership and motivation. Setting standards at industry-leading levels is not a requirement of the model.
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