This report will analyse as part of a group project, reward management methods in the NHS, Mothercare and London Eye, using theory and current practices. Firstly a description of the theory pertaining to pay and benefits will be discussed; exploring different aspect of reward in different sector i.e. public and private.
Next the observations of how the theory has been applied in the different organisations will be looked at. This will include academic research, organisational policies and the results and analysis of application/observations in the three organisations. The report will then critically evaluate the usefulness of the models in achieving the organisations objectives. Next the recommendations will consider any changes the organisation could adopt as a result of the research
1. Reward and Pay Strategy
Reward strategy is a mean of increasing productivity and performance in the workforce. It must consider all aspects of the workplace to “attract and keep high quality people doing the right things in the right way” (Kenworthy, 2008). There are many strategies that can be used for instance, human capital, and efficiency wage and expectancy theory. However Armstrong (2002) elucidates reward strategy as “the intentions of the organisation on how its reward policies and processes should be developed to meet business requirements”. In organisations it is used as a long term policy that supports the organisation and employee needs (CIPD, 2013). Reward strategy is derived from motivational theories for instance Maslow’s Hierarchy (1943), Alderfer’s ERG Theory and Herzberg’s Two factor theory.
1.1 Maslow’s Hierarchy Theory
Maslow declared that motivation is based on five basic human needs. These a...
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The pay and reward systems generally meet the organisations aims, however with the NHS and Mothercare models, human capital and efficiency wage do not address the issue of employees who have been with the organisation for over 10 years whereby progression stalls. The London Eye on the other hand continues to reward with bonuses dependant on company performance.
3.1 Recommendations
All three systems, although different help achieve the organisations goals. The NHS could improve its reward system by considering the issue of workers that have moved beyond the pay progression point by perhaps utilising the London Eye efficiency wage model.
Mothercare could incorporate the Expectancy model with the Efficiency wage model as individual workers are all motivated differently, so that employees that don’t benefit from the expectancy model will not be disadvantaged.
Mujtaba, B. G., & Shuaib, S. (2010). An Equitable Total Rewards Approach to Pay for Performance Management. Journal of Management Policy and Practice vol. II (4), 111-121.
Overall, the score of the article is a 95 out of a 100 because the author, Carol Patton was able to lure me into reading her entire piece. Additionally, after reading the article, I felt that I gained a bit of knowledge on the importance of reward programs and how it should be a “must have” in the work environment.
Companies are increasingly thinking about getting rid of annual pay raises. The positive side of this could redefine reward systems which motivates employees and attract high quality workers. Being that it could also have a negative side, it could prove to be a demoralizing switch that leaves many workers not able to provide for their cost of living. There is a decision to be made throughout companies which will have an effect not only on the company, but on the employees as well.
What Do We Know About Merit Pay? Issue brief no. 20. N.p., n.d. Web. 15 May 2014.
In this short paper I will explain why the statement “The introduction of individual pay for performance contributes to an improvement in a company's (financial) performance” is to my opinion not valid. Before we can jump into a reflection on the statement, two questions arise that will be discussed as an introduction “What is pay for performance?” and “Why is pay for performance considered as a system that might contribute to a company’s performance?”
Intrinsic rewards are not patterned financial rewards are associated with the requirement for employees to achieve greater success , recognition, a sense of responsibility , influence and development of other individuals. The requirements of the above is a strong motivator and contrast to the one . Each employee has different needs and desires . Rate a tremendous appreciation and gratitude is enough to inspire us all because of the appreciation of the value of giving someone touches his soul and give vigor to keep trying. Appreciate or appreciated regardless of age or where only a thousand meanings. Skinner ( 1969 ) reveals that the reward is a reinforcer . Reinforcing Here the meaning is interrelated aspects to the values that influence an individual's needs . However , Wether states that reward is what an individual received in return for a given job . It is the responsibility of an organization or institution to provide compensation and benefits to employees or students commensurate with a workforce that has been poured . The importance of rewards and benefits are indeed undeniable. If the employee or student is not satisfied with the compensation and benefits provided , then this will result in the existence of such problems as absenteeism , job rotation rate employing high , declining productivity and not serious in doing work .
Bratton and Gold (2003) describe a reward system as “The combination of extrinsic and intrinsic rewards delivered by the employer. It also consists of the incorporated policies, processes, performs and administrative processes for executing the system within the framework of the human resources (HR) strategy and the total organizational system”.
Performance related pay is a financial reward given to employees whose work is considered to have reached a required standard or is above average. “PRP criteria can relate to the individual employee, to work groups or to the organization as a whole” (Armstrong, 2002). It is fair to provide people with financial rewards as a means of paying them according to their contribution (Armstrong 1993:86). The primary purpose of performance related pay in any organization is to recruit, retain and motivate the workforce. It also helps in focusing employees’ minds on particular goals (Protsik, 1966); communicate to employees an organization’s core values, and change the culture of that organization (Kessler and Purcell, 1991).
An incentive or reward system refers to a program designed by an organisation to reward high performance and motivate workers on an individual and group basis (Corby et al. 2009, p. 2). Rewards are useful to a company operating in a competitive market. Although used interchangeably, rewards and recognition where the former can be monetary or non-monetary but has a cost to the company, while the latter is meant to offer psychological reward, for instance, oral public recognition or end of the year award. While the company does not provide financial incentive, it provides non-financial in the form of cars for its Sales Division consultants. This improves the working condition of the employees, but it does not improve their financial stance. Wright (2004) notes that some employees are more concerned with status, for instance, an executive desk, attractive office or business card (p. 76). Such incentive make the jobs and company attractive.
Incentive reward engagement offers a win-win situation for the employees and the company. Kelleher believes that incentive is a form of recognition and builds engagement through company’s and employee’s obligations towards a common goal (2014). The company has a “Growth Incentive Scheme” for the production workers. Special monetary incentives are provided should the workers achieve the monthly output target. Through the rewards, employees feel motivated towards their work and thus, contribute towards the company’s
2). Looking at performance-related pay in the framework of reinforcement theory believe this system of payment and compensation “suggest that pay can be used to create consequences for desired behaviors such as high performance that will in turn reinforce the behaviors” (p. 2).
To effectively subsist in the contemporary world , Companies have embraced the total rewards system and made it part of human resource management practice with small and big organizations employing it to enhance their competitiveness in the local and global markets. First introduced in 2000, the total reward theory shows the vibrant relationships that employers have with their employees. However, "WorldatWork - Total Rewards ModelTotal Rewards Model SVG Graphic",( 2016) states that ; this concept has developed to describe means through which employers and employees benefit from each other as well as how external and global business environment influence the productivity , retention and engagement at work .
Aligned – reward programmes and practices are transparent and focus on ensuring alignment at several levels
...a reasonable deal on pay or in any rewards system centred on the length of service or performance.
Remuneration management is defined as the sum received for an employment or service delivered, this includes the money received on a monthly basis as well as benefits given as rewards (investopedia,para.1 ). Individualism need to be taken into account when implementing these remuneration structures or reward schemes, equal pay plays a role in balancing earnings among the diverse workforce (Shen, Chanda, D’Neetto and Monga,2009,p.241). The Woolworth’s Holdings uphold remuneration policies which have the purpose of making sure to attract and hold on to the best talent, that they are congruent with the strategies of the company and are the determinants of performance during the short and long phases. The policy considers the board members and the employees. This policy manages employees of the company by giving...