Pay for Performance Trends Growing among Higher Ed Institutions

February 26, 2010 ( – Sibson Consulting reports that pay for staff performance and better performance processes are gaining traction in academia.

According to Sibson, more college and university supervisors and staff are engaging in performance planning/goal setting, ongoing review and feedback, and end-of-year formal assessment. “Even with tight budgets, better alignment of salary increases with performance is becoming prevalent, and incentives that have to be earned each year are under consideration,” Sibson said.

The consultant noted that performance planning and assessment have not been taken into consideration by many higher education institutions as effectively as they could be; however, the present state of the economy and higher education’s fiscal situation have made academic leaders focus more on staff performance.

“Institutions of higher education are increasingly determining what constitutes performance and whether rewards or other processes support accountability, reinforce expectations and reward results. Performance criteria are being connected to rewards such as merit pay, incentives, career advancement/job progression and service awards,” said Karen Hutcheson, senior vice president in the New York office of Sibson Consulting.

However, higher education institutions still have work to do with their rewards process, as Sibson reports it still sees:

  • Inconsistent performance management administration across campus;
  • Emphasis on appraisal of past performance rather than future planning;
  • Performance management viewed as an HR requirement and not a management tool;
  • Processes, tools and criteria defined by HR with little or no input from supervisors;
  • Little or no link between performance and pay; and
  • Cultural resistance to differentiation or constructive feedback.


“Institutions of higher education are expressing a need to align performance with institutional strategy, communicate the business needs of the institution, set higher standards for performance at all levels and hold people accountable. How the work gets done is as important as what gets done, and there is growing emphasis on staff development as a component of performance,” said David Insler, senior vice president in Sibson’s Los Angeles office.