Performance Based Incentive in Bhutanese Civil Service

Abstract

Performance Based Incentives (PBIs) have been adopted in some countries as a means to increase motivation among employees to improve organizational performance. Findings from other research studies show that performance objective setting, performance evaluation and developing a link between performance and incentive are three essential criteria for connecting a performance evaluation system to PBI. In 2019, the Fourth Pay Commission of the Royal Government of Bhutan proposed a PBI system involving monetary incentives. However, the Royal Civil Service Commission was not confident to monetize the PBI as the newly introduced performance management system, Managing for Excellence (MaX), was still in its infancy. This study assessed whether the Bhutanese Civil Service is ready for the introduction of PBI under the current performance evaluation system according to the views of civil servants. A quantitative approach has been employed where (n=168) respondents were randomly selected using proportionate sampling method and surveyed. The data were analyzed using descriptive statistics and binary logistic regression. The findings showed that the Bhutanese civil servants believed that their civil service was not ready for the introduction of PBI. The major issues that emerged from the findings were that the sub-systems of the present performance management system were not yet adequately developed. It is recommended that the present system should be improved through proper target setting, objective performance criteria, and a transparent evaluation system as well as training the supervisors in performance management and PBI, and giving timely feedback to the employees. Further, performance-based incentives should also be explored.