A performance-based compensation system focuses on three independent areas: the officer's overall job knowledge and physical competencies, the quantity of work performed, and the quality of that work. Automatic step increases were eliminated, salary ranges were expanded by 10 percent, and a skill incentive program was made a formal part of the compensation process. This approach did not require substantial costs to the city; instead, the allocation of funds became more meaningful. Officers take an annual competency examination. A productivity assessment system compares an officer's performance to that of others doing similar work. No quotas are used. Although improving police performance is a difficult task, it is possible and should not be avoided. Money is the most visible and meaningful symbolic gesture of an employer's appreciation and provides an incentive to the employee. Forms and materials used in the program and reprints of articles related to the subject are included.