Dimunge Wasantha Premakumara,

Esoft Metro Campus.

Student #00098180

E138791.

Peoples & organization.

Reward management strategies,

Definitions.

“Reward management is the introduction of policies and strategies that rewards every employee within the business fairly and consistently across the board. Rewarding employees for outstanding work makes them feel valued and can prove to be a powerful motivational tool that boosts productivity” – (Michael, 2004)

Reward management is concerned with the formulation and implementation of strategies and policies in order to reward people fairly, equitably and consistently in accordance with their value to the organization.

It deals with the development of reward strategies and the design, implementation and maintenance of reward systems (reward processes, practices and procedures) which aim to meet the needs of both the organization and its stakeholders. Reward can be regarded as the fundamental expression of the employment relationship.

The aims of reward management,

·         Reward people according to what the organization values and wants to pay for.

·         Reward people for the value they create.

·         Reward the right things to convey the right message about what is important in terms of behaviors and outcomes

·         Develop a performance culture.

·         Motivate people and obtain their commitment and engagement.

·         Help to attract and retain the high quality people the organization needs.

·         Develop a positive employment relationship and psychological contract

 
The philosophy of reward management,

A belief in the need to achieve fairness, equity, consistency and transparency in operating the reward system.

Operate fairly –people feel that they are treated justly in accordance with what is due to them because of their value to the organization  

Apply equitably –people are rewarded appropriately in relation to others within the organization, relativities between jobs are measured as objectively as possible and equal pay is provided for work of equal value.

Function consistently –decisions on pay do not vary arbitrarily and without due cause between different people or at different times.

Operate transparently –people understand how reward processes operate and how they are affected by them.

Reward policies

Reward policies address the following broad issues:

The level of rewards taking into account ‘market stance’ –how internal rates of pay  : should compare with market rates, aligned to the median or the upper quartile rate;

Reward policies,

Reward policies address the following broad issues:

The level of rewards taking into account ‘market stance’ –how internal rates of pay  : should compare with market rates, aligned to the median or the upper quartile rate;

Achieving equal pay;

The relative importance attached to external competitiveness and internal equity;

The approach to total reward;

The scope for the use of contingent rewards related to performance, competence, contribution or skill;

The role of line managers;

Transparency –the publication of information on reward structures and processes to employees.

The Non financially rewards mean is -Rewards which do not involve any direct payments and often arise from the work itself, for example, achievement, autonomy, recognition, scope to use and develop skills, training, career development opportunities and high quality leadership.

The benefits of a total reward,

Greater impact –the combined effect of the different types of rewards will make a  deeper and longer-lasting impact on the motivation and commitment of people.

Enhancing the employment relationship –the employment relationship created by a  total rewards approach makes the maximum use of relational as well as transactional rewards and will therefore appeal more to individuals.

Flexibility to meet individual needs –as pointed out by Malkovich and Bloom (1998):  ‘Relational rewards may bind individuals more strongly to the organization because they can answer those special individual needs’.

Talent management –relational rewards help to deliver a positive psychological contract and this can serve as a differentiator in the recruitment market which is much more difficult to replicate than individual pay practices.  Theorganization can become an ‘employer of choice’ and ‘a great place to work’ thus attracting and retaining the talented people it needs.

Developing reward strategy.

The formulation of reward strategy can be described as a process for developing and defining a sense of direction. The main phases are:

1. The diagnosis phase, when reward goals are agreed, current policies and practices assessed against them, options for improvement considered and any changes agreed.

2. The detailed design phase when improvements and changes are detailed, and any changes tested (pilot testing is important).

3. The final testing and preparation phase.

4. The implementation phase, followed by ongoing review and modification.

Thank You!

References, 

1.      Murlis, Michael Armstrong & Helen (2004). Reward management: a handbook of remuneration strategy and practice (5th ed.). London [u.a.]: Kogan Page. ISBN 978-0749439842.

2.     Latham, Gary P. (2012). Work motivation: history, theory, research, and practice (2nd ed.). London: SAGE. ISBN 9781412990936.

3.     Mitchell, T.R. 1982. Motivation: new directions for theory, research, and practice. The Academy of Management Review. [E-journal]. 7(1), 80-88. Available at: https://www.jstor.org/stable/257251. Accessed: 1 March 2014.