REWARD MANAGEMENT SYSTEM

 

Employee reward systems ask programs found out by a corporation to reward performance and motivate employees on individual and/or group levels. They normally considered break away salary but could also be monetary or otherwise have a price to the corporate. (Employee Reward and Recognition Systems,2018)

Objectives of the reward management system of the organization

·       Support the organization’s strategy

·       Recruit & retain

·       Motivate employees

·       Internal & external equity

·       Strengthen psychological contract

·       Financially sustainable

·       Comply with legislation

·       Efficiently administered

Types of rewards within the organization

·        Individual: base pay, incentives, benefits

(rewards attendance, performance, competence)

·        Team

(Team bonus, rewards group cooperation)

·        Organization

(Profit-sharing, shares, gain-sharing)

·        Extrinsic rewards

(satisfy basic needs: survival, security)

(Pay, conditions, treatment, foods for breakfast and lunch, give uniforms, transport services to all employees)

·        Intrinsic rewards

(satisfy higher needs: esteem, development)

Ex: Employee development programmes, Employee gatherings, sports events, music programmes, yearend gifts to employees

Role of Reward strategy of the organization

The compensation and Reward system play a vital role during a business. Consider the resources of the organization human resource expects wages from the organization. It is evident that other factors are in-human factors and intrinsically labour plays a vital role in bringing about the method of production/business in motion. The opposite factors being human has expectations, emotions, ambitions and egos. Labour, therefore, expects to possess a justifiable share within the business/production process. Rewards can fulfil the expectations of employees or labours of the organization. (Human resource of the organization,2011)

Positive points of the reward system

When referring to the organizational reward system some plus points can be identified.

·       There are some points to develop the team culture within the organization

·       According to this system will encourage the improve performance of the employees, employee development

·       Because of this system employee motivate to achieve their targets and KPIs. It will lead to efficiency and effectiveness of the organization

·       Some activities create peace and harmony in the organization. Further, it will generate a friendly environment with the organization

·       When organization offer the profit shares to employees they will encourage to work more productively because once organization achieve profits they can also get the profit shares

·       This system will encourage the method of job evaluation. It’ll also help in fixing a perfect job evaluation, which can have transparency, and therefore the standards fixing would be more realistic and achievable.

Weaknesses of the reward system of the organization

According to the reward system of the organizations can identify some weaknesses also. Those can be identified as below,

·       Not arrange the reward systems differently to employee levels of the organization. All the labourers, executives and managers have the same system

·       Increase the cost of rewards once not analysis the cost and benefit analysis before introducing the reward system

·       Planning and Execution - additionally to the value of giving gifts to employees, time must be put aside to plan and execute the giving of gifts. If the gifts are a performance-based incentive, the performance of employees must be evaluated before the gifts are often given. Albeit the gifts are for all employees no matter performance, the purchasing, preparing and distribution of the gifts takes time. Time must even be spent determining the standards for gifts and deciding who within the company is qualified and impartial enough to line those criteria fairly.

·       Lack of future benefits - Cash bonuses and other gifts may provide a short-lived incentive to employees, but over time, the advantage of these gifts begins to fade. The sense of appreciation or other motivation that employees feel when receiving a present could also be gone within a couple of months, especially when cash is given, which can be quickly spent.

·       Motivation issues - If the gifts a corporation gives are performance-based, employees who didn't receive a present may feel less motivated to figure, as their work quality was judged to not be good enough; this effect is often made worse if an employee previously thought that he was doing an honest job.

 Reference List

Kelly, D. (2018, November 8). Benefits of Effective Employee Rewards and Recognition - CR Worldwide. Corporate Rewards. https://www.crworldwide.com/news-ideas/employee-recognition/benefits-of-employee-recognition-and-rewards/

Reward Management. (2011, August 28). Human Resources Management; Human Resources Management.https://corehr.wordpress.com/compensation/reward-management