Motivation - Reward Management Flashcards
What is reward management
A critical component of work-force management… attracting and retaining staff… influencing performance and behavior at work
A company’s reward system is a powerful indicator of its philosophy and its approach to workforce management
Main objectives of reward management
Motivate people and obtain their commitment and engagement
Promote a culture of performance and achievement
Create value and improve overall position of business
By rewarding the right thing(s) it helps convey the right message about what is important (behaviors and outcomes)
Helps attract and retain the higher quality people the organization needs
Develop a positive employment relationship
Characteristics of RM
Reward level - must statisfy basic needs for survival, security and self development
Individuality - must be flexible to satisfy the individual needs
Internal equity - must be seen as fair when compared with others in the company
External equity - must be seen as fair when compared with other companies
Trust - management and employees must believe in the system
Components of RM
Base pay - varies according to the grade of the job
Contingent pay - additional financial rewards are provided that are related to performance, competence, contribution, skill or experience
Employees benefits - pensions, sick pay, insurance cover, company cars and a number of other ‘perks’
Non-financial rewards - rewards that do not involve any direct payments and often arise from the work itself (achievement, recognition, career development, opportunities etc.)
Factors influencing the value of the reward system
Economic climate
Labor market
Government policy
Trade unions
Company ownership
Company size
Technical systems
Types of reward systems
Flat rate systems
Performance-based incentive systems (PBR systems)
Types of flat rate systems
Flare rate
Annual hours contract
Types of performance-based incentive systems
Flat rate plus individual PBR system
Piecework
Flat rate plus group/team-based PBR
Gainsharing and share ownership schemes
Competence or skill-based pay
