It does mean putting a fair amount of management information about staff planning into the public domain. Most companies will feel uncomfortable about that, for obvious reasons, but only by being open about excesses and shortages in the company’s internal labour market can the management hope to fine- tune supply and demand for labour.Second, they can encourage employees to comment on the effectiveness not just of reward structures, but of the perceived skill gaps they see in their organisation. But it has yet to develop a market for unsold jobs (so to speak) by matching skills to slots.What can companies do about this? There is no magic wand, but they can do three things now.First, they can use an intranet to improve their internal market in jobs. It has been very difficult to know whether a company is paying the right rate or the wrong one, because the information is disorganised and partial.

It is equally difficult for employees to know, for the same reason. If you find you have too many good applicants for jobs, you pay less.The choice of how people take their pay – the balance they want between basic pay, the various bonuses and other benefits such as share options – is an important but ultimately a secondary issue. Now, at last, the potential of the Internet can be harnessed to make the labour market adjust more effectively.The hardware exists to tell employers whether they are paying the wrong rate, and to tell would-be employees not only where their skills would be best rewarded, but also what skills they should try to acquire if they want to be better paid.Trouble is, the software is still weak. The market will determine whether you are paying the right amount or the wrong one. Companies do need help in implementing new reward systems and in devising them.But at the risk of seeming Luddite, I found myself wondering whether companies would be better listening to the market and watching its signals, rather than trying to develop complicated reward systems – and whether the new communications technologies would make it easier for them to do so The proposition is this. At present, large companies operate more or less hierarchical systems for determining pay, in the sense that assessment of how people perform plays a large part in most reward schemes.These are tempered by the incentive and bonus schemes, but essentially the setting of pay is a bureaucratic procedure.The market approach is different You simply look at what you need to pay to get a job done If good people keep leaving, you pay more. If people don’t understand how incentives work it is unlikely such schemes will be effective.If it is shocking it should at least be unsurprising.

Another finding of this survey is that only 7 per cent of companies consult employees before introducing an incentive plan. If firms don’t ask people what they want, they should not be too surprised if the staff don’t understand the scheme the company devised.Towers Perrin is a human resources consultancy and part of its business is helping companies develop their reward systems. I suppose you could say this sort of conclusion plays to their strengths: incomprehensible, badly-designed pay systems are just the things the firm is paid to sort out.But its gloomy findings fit with most peoples’ experience, that pay systems are arbitrary and wasteful. A survey by Towers Perrin of large companies in Europe suggests only 4 per cent reckoned their staff had a good understanding of even how their basic pay was set – and that is before you get into the more complicated things, such as incentives. ARE YOU paid enough? Most people would probably say, “No”, and may or may not be right Now try another question. Do you know how your pay is determined? Most people would probably say, “Yes”, and they would be wrong.

Whether or not people think they are paid enough is subjective, but they certainly cannot make a rational judgement on that if they don’t understand how company reward systems are constructed.
Apparently they don’t. In London, where UBS operates as Philips & Drew, investment performance improved.. It advised Sprint, the US telecoms giant, in its $129bn bid for rival MCI and is advising Vodafone in its pounds 76bn hostile bid for Mannesmann, the German telecoms giant. But assets under management were down overall in the third quarter reflecting a weaker investment performance and net outflows This was more marked in the US. This fact will be seized on by the bank, which is seeking to quash doubts about its commitment to WDR.Last week Marcel Ospel, the chairman, dismissed talk that Warburg was up for sale, arguing that it was an integral part of the broader bank.

PROFITS AT UBS, the Swiss banking giant, rose 44 per cent to 5bn Swiss francs (pounds 2.27bn) before tax and exceptionals in the first nine months of the year as a result of a dramatic rebound at Warburg Dillon Read, UBS’s City investment banking arm. Price rises were strong across the country ranging from 6.6 per cent in Yorkshire to 16.8 per cent in London.. “It is one factor, but it is certainly not the dominant factor, let alone the only factor,” he said. “We can either seek to shelter a particular sector by putting the whole economy at risk of accelerating inflation or we can pursue our mandate to deliver stable inflation across the economy.” He said the plight of manufacturing was more closely linked to the level of global demand than monetary policy.Dr Wadhwani said evidence that house price inflation was no longer concentrated on the South-east was one factor that persuaded him to switch his stance on rates.The comments came as Land Registry figures showed house prices rose 12.3 per cent in the year to September – the highest so far this year from any survey. It is important it does,” said Dr Wadhwani, who is believed to have first raised the issue.Mr George also denied the MPC had “sacrificed” jobs in the manufacturing industry in the Midlands and North by hiking rates to control rising house prices in the South. “If you get it in the press, it [is] distorted and over-hyped.