Abstract In this work we propose a novel approach for computing the variable pay/pay for performance component of employees in a technical institution based on Takagi Sugeno Kang (TSK)/Sugeno fuzzy inference system. Sugeno fuzzy inference system is an inference model based on fuzzy set theory and is known to handle MCDM (Multiple criteria decision making) problems quite efficiently. In the proposed model the Sugeno fuzzy inference system has been used to compute the variable pays of the faculties based on their individual API (Academic Performance Indicator) scores in a particular appraisal year. The model aims to overcome the pitfalls of the current forced distribution technique being used for appraisal and subsequent variable pay decisions. The performance of the proposed model has been tested with the API scores of all the faculties of the said institute. Along with that a function was used to generate random inputs in the range of API scores to extensively test the model. All the methods were implemented in MATLAB and the results were analyzed in EXCEL using the CORREL and PEARSON’s coefficient. Experimental results show that the proposed model is reliable and demonstrates significant improvement over the traditional forced distribution approach currently adopted.
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