When not organised last year morale
not good. Everyone focused on the bonus and not the constrictive advise or
learning and development opportunities.
Consider the impact on morale, motivation the
psychological contract, and ultimately organisation success.
Get feedback –
what are the challenges/ consultant
Don’t separate the learning and
development from the monetary bonus
Not as involved or skilled as they
Line Managers need to be skilled and
knowledgeable in relation to conducting performance appraisals to understand
what is important to the employee and to focus on L and career
Douglas McGregor is a
contemporary of Abraham Maslow. Likewise, he also contributed much to the
development of the management and motivational theory. He is best known for his
Theory X and Theory Y as presented in his book ‘The Human Side of Enterprise’
(1960), which proposed that manager’s individual assumptions about human nature
and behaviour determined how individual manages their employees.
Historically the rewards were based on a
formula created by the CEO and Finance Director. They would get the information
from the line manager as per the criteria and based on that would decide who
would get what bonus. However, we are of the opinion that feedback from the
line manager is important to give context to the criteria. Appraisals we not
always conducted in the manner that perhaps they should have been leaving the
company open to backlash from employees when they felt they didn’t get what
they felt they deserved or expected.
Discuss the role of the line Manager in Reward
Decision in the organisation and how it can and should contribute to decisions
of Line Manager
Not considering the non-financial
Not always objective
Best practice in regard to equitable, fair,
consistent and transparent Reward policy, and how it compares to your chosen
Internal and external training- paid
for by the company
School swap- teachers/office staff
Christmas Bonus – Vouchers
Quartley team building
Health Insurance – up to €2,000 – SMT
Pension contribution – SMT
Festival – All staff
Money- average performance
Total Reward and the contribution it makes to
sustainable organisational performance.
Evaluate the Key Reward Principles listed
below and discuss how they are applied, or not, within your chosen
Frederick Herzberg contributed a great deal to the Human
Relations School of Management through his insights into the areas of employee
satisfaction and motivation. Herzberg’s motivation theory, also known as the
Two-Factor Theory, covers what he called the “Hygiene Factor” and the
“Motivation Factor.” Although Herzberg’s theory is not highly
regarded by psychologists today, managers have found in it useful guidelines
for action. Its basic tenets are easy to understand and can be applied to all
types of organisation. Furthermore, it appears to support the position and
influence of management. It has been noted that links between motivation and
productivity are beyond the scope of Herzberg’s work, and the usefulness of
motivating factors from the perspective of management may depend upon proving
this relationship, as other authors have tried to do.
How has the reward impacted the
Rewards that have worked/not
Performance and monetary together.
Focus on monetary and not personal development and career growth
Monetary, supposed to be based on
performance. Not objective
Annually the CEO will organise, and the
company will pay for all employees to attend a music festival somewhere in
Europe. This is somewhat of a tradition and while this is an incentive that is
very attractive to some of the employees it only rewards those who attend and
those who don’t attend don’t receive the value of it. What does the festival
reward? I am not entirely sure. Does it improve performance? Not enough to justify
Ø Making all of the above transparent, positive and
Ø Ensure rewards are affordable to the company
and of value to the employee
Ø Guiding performance /behaviour towards change
Ø Rewarding appropriately
Ø Achievable targets
We will update our policy to reflect
the changes we are making to ensure we are covering the following:
Our aim in making this change is to adapt a
positive culture towards performance and learning and development with the company
and paying out bonuses to those deserving of them in line with financial
results of the company. We will look at
a total rewards system which has never been used in the past and gain the benefit
of both the financial and non-financial rewards available to us.
We plan to separate the monetary aspect from
the performance appraisal itself focusing on the employees past year’s
performance and asking their input to outline objective and L for the
coming year. We will of course create a bonus scheme based on the performance,
commitment, longevity of the employees in addition to the KPI’s linked to their
We are currently in the process of changing
the way we view rewards. Historically appraisals were held in February with a
monetary reward paid in the March payroll. It has gotten to the stage where employee’s
view the bonus as an entitlement rather than rewarding performance based on KPI’s.
Traditionally little preparation went into scheduling and assessment of previous
appraisals which left employees frustrated and not listed to. The feedback we have received in relation to
past appraisals is that they had been rushed, not objective and negative with
very little focus on future objectives and learning and development.
A critique of the organisation’s existing
Reward Strategy outlining the key factors contributing to its success or
Using the strengths of employees
Staff feel entitlement
The links between Reward and Business Strategy
in the organisation, considering Internal and External context and culture.
In a 2009 survey conducted by
McKinsey & Company, non-financial
incentives were rated as more powerful motivators than financial incentives.
incentives are the types of rewards that are not a part of an employee’s pay
and typically cost the company little or no money yet carry significant value
and motivation for the employee. These such incentives are particularly
effective for workers who are comfortable with their salaries or have been in
the position for a long time.
Communication is essential to keep employees informed of the
situation of the business. It is thought that when employees know that the
existence of their company is at stake, they will naturally change their manner
and behaviour in a positive way towards increasing their productivity. Employees
tend to be greatly influenced by the way their performance is assessed and
rewarded. Total rewards for an employee is everything they perceive
to be of value resulting from their working relationship with the employer.
important when devising a reward system that the company understands as much as
possible the needs of its employees and what rewards would be of most value to
them with minimal cost to the company. Once you have this data you can create a
total reward system consisting of place of work, role, career progression,
salary and benefits. Both financial and non-financial rewards criteria
have tremendous influence upon the employee’s performance. These rewards also
work based on the personality of the employee and according to their taste. For
example, an employee who is an avid reader could be rewarded with a subscription
to an online bookshop or Kindle.
what it is you are rewarding and why.
the market in which you compete for skills, the areas of shortage and demand
for scarce talent.
the perceptions and values of stakeholders relative to remuneration and the
financial position of the company.
the workforce, its demographics and productivity potential.
the company’s strategy, critical success factors, culture and the environment
in which it operates.
and critical aspects that need to be considered before formulating any reward structure/
structures fail through poor implementation. An effective reward structure, balances strategic
and operational goals, ensuring short term actions don’t negate long term
opportunities and that the organization can attract, retain and motivate the
quality of people it needs – people with the necessary skills, experience
(and/or potential to develop these skills) to achieve its goals. It is about
rewarding employees for their efforts, skills and contributions. It enables
Directors and HR to plan and approve rewards and Line managers to administer or
The main aim is to create an efficient reward management
structure and any good reward management structure
must be transparent to all employees to ensure that they understand and commit
to what they are getting rewarded for and why. For new employee joining the
company it is important to communicate the reward management system to manage
their expectations and give them the opportunity to make the most of the
employment which will be of benefit to both themselves and the company. Generally,
a total rewards structure consists of financial
rewards such as pay/bonus and non-financial rewards such as employee
recognition, employee L and increased job responsibility.
For the last 4 and a half years I have worked for
a successful English Language School. We have a school here in Dublin and one
in London, with approximately 70 employees between the two schools facilitating
the academic, sales and administration departments of the company. The company
was founded by someone who’s objective is to provide a fun and social learning
environment for students who come to learn English at both schools. The key
element to achieving this is to attract, motivate and retain competent
academic, sales and administration talent.
Maslow (1943, 1954) stated that people are motivated to achieve
certain needs and that some needs take precedence over others. Our most basic
need is for physical survival, and this will be the first thing that motivates our
behaviour. Once that level is fulfilled the next level up is what motivates us,
and so on.
Reward management is an important component of
our company’s HR strategy in which it is essential that we aligne with our
Business strategy to achieve the overall company goals and objectives while
meeting the intrinsic and extrinsic needs of our employees. It is hugely
important in the attraction, motivation and retention of talent and is one of
the key levers any company has available to them that can influence the
behaviour, motivation and the commitment of its employees.