The Study Of Performance Appraisal And Compensation Incentives For Herda Company

The Paper Manufacturing Industry has developed greatly in recent years. Ranking the second worldwide by total paper consumption volume, China is now the third largest paper making country following USA and Japan. It is estimated that in future China will surpass any other country in the world by the Increase Speed of paper consumption. Hence, there is a big potential market for paper industry. Herda Company, the background of this article, is one of them. Like most companies, Herda has its disadvantages in many aspects when compared with foreign companies. In terms of infrastructure, it is lagged behind on equipment, technology, raw material availability and product structure. In terms of soft environment, it is weak in corporate governance mechanism, strategic human resource management. Its system of performance appraisal, compensation and incentives needs improving. Aiming at improving the current system of performance appraisal, compensation & incentives, this article firstly diagnosed 7the situation of performance appraisal and compensation system. Then it put forward solutions to improve the current system. This paper adopted interviewing method to conduct research, collected and analyzed financial data for several public listing companies. Finally, this paper proposed long term incentives and virtual stock for executives. Some of the proposals in this paper have been adopted by Herda company. The whole research is yet to be implemented and improved.