Business
Introduction 3
Literature Review 3
Analysis and Discussion 4
Would you relate the payment to the demands of the job or to the relative performance of individuals doing the job? You should justify your decision and include the following; 4
Discuss the links between strategic reward and organisational strategies, link to total and strategic reward practices and the role of PRP 5
What impact would markets and legislation have on the system 6
Conclusions 8
Recommendations 8
Reference List 9
Introduction
Pay and reward of employees are two inclusive aspects within the operational facet of an organization. Thus, organizational investment into a pay and reward system (PRP) is crucial towards sustenance of performance and profitability within the organization. As an organization, it is pivotal that a proper pay and reward system is evident to ensure profitable outcomes. Without a profound pay and reward structure that emanates from equality and fairness from employee perspective, motivation and performance of employees is not bound to prevail. Hence, in the inculcation of a PRP approach should emanate from clear cut research and incorporation of plausible performance mandate. Thus, this paper will evaluate pay and reward systems through review of the research available and as per the case questions.
Literature Review
Pay and reward system within the organization emanates from the prevailing organizational culture within the internal environment and prevailing market and legislation facets in the external environment. As such, the reward strategy is a policy approach that provides proper directions for a business towards the development and design of programs that ensures performance of employees. On the other hand, the payment structure is construed towards ensuring an either job demand or performance standards are met by the employees (Foot & Hook 2008). The organizational approach towards the pay or reward system emanates from extensive research within the internal and external environment. There prevails diverse or vast studies on the effects of pay or reward systems on employee performance. As such, vast results reveal that a proper pay and reward structure (PRP) necessitates positive effects on the performance standards set by the organization. Hence, towards sustenance of positive outcomes reward and pay aspects within the organization have to be evaluated highly by the organization in meeting its performance needs. Research into the approaches to payment, the reward system to prevail and so forth is significant towards meeting the targets set. Thus, an extensive analysis and discussions of reward and pay (PRP) as per the case questions is effective towards proper performance mandate of an organization.
Analysis and Discussion
This paper focuses on the evaluation of strategic reward and payment structure that a company should incorporate towards sustenance of performance and highly motivated employees. Hence, towards a further analysis of strategic reward this part will examine the case questions as per the literature review undertaken.
Would you relate the payment to the demands of the job or to the relative performance of individuals doing the job? You should justify your decision and include the following;
As such, from an individual evaluation, I would relay payment to the relative performance of individuals doing the job. As such, relating payment to the demand of the job is imperative since it generates three facets or reasons in regards to the organizational and employee strategy;
- Relating payment to individual performance results into the organization investing highly into reward and recognition; an organization, through relating payment to performance utilizes recognition and extensive performance towards stimulating higher performance within the operational facets of the employee. Accordingly, relating payment to performance necessitates extensive evaluation by the organization in regards to the performance contribution of the employee (Foot & Hook 2008). The employee role played should be within the standards set by the organization.
- As second aspect, relating payment to performance results to organizational investment into talent management. As such, talent management focuses on in-depth investment into attraction, pretension and sustenance of a deep source of talented employees (Foot & Hook 2008).
- Relating pay to performance results into organisational effectiveness. Organisational effectiveness entails a highly performing organisation in which adaption to the performance standards is evident. Furthermore, maximisation of employee contribution and delivery of the performance goals is evident through relating payment to the performance mandate of employees.
Within a holistic operational aspect of an organization, relating payment to performance is a proper approach towards providing the right direction towards sustenance of organizational effectiveness, talent growth and reward agendas. The underlying organizational thought is towards the performance levels or standards that need to be met. As such, the employee functional strategy is an imperative or crucial facet within the DNA of the organization. Armstrong (2011) asserts that the organizational performance mandate is pivotal towards sustenance of viability, profitability and revenue yield. Hence, to sustain the organizational operations, relating payment to performance is a highly plausible and viable approach by the management. As such, the strategy towards relating payment to performance should have the following policies;
- Widespread investment into its employees through improvements in the degree of intellectual level
- Incorporating a dynamic reward system that is in line with business core competency
The differing perceptions of pay for employers and employees, particularly PRP,
The perceptions of pay for employers and employees have been a significant aspect within the inculcation of a PRP approach. Accordingly, one of the most pertinent issues in regards to the perceived inequity in pay and reward originates from the employer pay. The prevailing perception that employers receive high pay increases within the period that organizations are cutting back on employment or declaring redundancies has led to a highly conflicting environment in regards to employer and employee within the PRP approach (Foot & Hook 2008). Thus the discontent within the perception of employer and employees has been highly evident across US especially in the periods of economic downturn. Within the 2007-2008 recession periods, the PRP approach received significant backlash especially in the reward process of employers.
Discuss the links between strategic reward and organisational strategies, link to total and strategic reward practices and the role of PRP
First and foremost, the organizational strategies focus towards ensuring or concentrating on achieving competitive edge through the inculcation of innovation. Furthermore, delivery of quality products and services to the consumer market that necessitates profitable outcomes forms the organizational strategies. As such, the inculcation of the strategic reward approach forms the most plausible link towards achieving of the organizational strategies aforesaid. As such, the reward strategy focusses on the process of involvement, participation and sustenance of highly motivated employees towards meeting the organizational strategies set (Baron & Kreps 2009). Emphasis on the concentration on how the organization will achieve the efforts or strategies set emanates from highly motivated employees through proper reward strategies. On the other hand, total reward strategy denotes a holistic approach towards the management and motivation of employees through an inclusive comprehension of their needs. Thus, the total reward approach denotes a combination of both the non-financial and financial needs that are highly available to the employees. Hence, the role of PRP within the total reward approach emanates from the financial rewards facet of total rewards. As such, PRP plays a crucial role towards the determination of the financial reward approach that the organization can inculcate. Focus on compensation, employee benefits, proper numeration and so forth forms the pivotal facets linking both total reward strategy and PRP mandate.
What impact would markets and legislation have on the system
It is imperative that organizations comprehend that there are disparities between pay and rewards within the operational facet. As such, the fair labor standards act of 1938 has been amended extensively towards an inculcation of plausible operational facets in regards to the pay and reward structure evident (Baron & Kreps 2009). As such, the labor standards act determines the major components of minimum wage, the prevailing overtime pay, inculcation of equal pay and so forth (Baron & Kreps 2009). As such, the organization in setting up the PRP approach, it is imperative that it conforms to the sections regulating equitable payment, minimum wage and compensation facets. On the other hand the equal pay act of 1963 is construed towards necessitating equality in payment based on the sexes (Baron & Kreps 2009). On the other hand, in the inculcation of PRP approach, the equal pay act does not prohibit payment based on seniority systems, merit systems or payment that is based on performance. Thus, the two aforesaid legislations impact on the performance mandate of the PRP in regards to the legal stipulations that an organization has to conform or not inculcate.
Ensuring a fair and equitable pay or reward system is an imperative aspect within an organization. Employees need to feel that the organization rewards or pays them within an equitable and fair mandate. Thus, from the evaluation of Armstrong (2011) the various methods and procedures towards ensuring fair and equitable system and the elements of pay include;
- Highly reviewing the pay levels on the basis of the market surveys
Conformity to the prevailing market surveys on the reward and pay systems is imperative. As such, the evident pay systems form a proper blueprint for organizations to inculcate. Conformity to the market surveys ensures that employees feel the organizational operations are based on the pertinent trends within the job market (Khanka, 2007).
- Introduction of job evaluation or improvement of the existent scheme to generate equitable grading decisions
Constant job evaluation is pivotal towards sustaining a more comprehensive approach in the inculcation of enhancements within the reward and pay systems (Khanka, 2007). Additionally, constant improvement if pivotal towards sustaining highly motivated employees regarding the pay structure.
- Tailoring the diverse benefits in regards to individual requirements and preference
Tailoring the benefits in regards to employee requirements and preference emanates from an inclusive approach by the management. The management should include its employee in the tailoring process to ensure that equality prevails in regards to the reward and payment system evident.
- Collaborative approach through the involvement of employees in the development and operational facets of job evaluation and the prevailing contingent pay systems
As aforesaid, involvement of employees is pivotal towards sustenance of an equitable and fair reward system. As such, from the evaluation of Khanka (2007) contingent pay systems require inclusivity of employees in the decision making. Including employees within the decision making mandate alleviates suspicions and prospects of inequality in the reward system.
- Extensive review of performance of performance related pay schemes towards ensuring they operate within a fair mandate
Reviewing of performance related pay schemes necessitates improvements both within and outside the scope of operation within the organization. Investments into improvements approach ensures that the pay elements are dynamic and focus on ensuring equity and fairness in pay schemes (Khanka, 2007).
Conclusions
Employee performance emanates from the use of diverse policies and systems put in place that sustains highly motivated employees. Hence, from the above evaluation, an effective pay and reward system should focus on sustaining parity and equity within the employee internal environment through proper analysis of the market and legislations evident. Through a comprehensive and inclusive approach in setting up the PRP system, an organization is bound to maintain highly motivated employees. Employees that are highly motivated operate towards sustaining profitability within the organization and ensuring viable operations.
Recommendations
Organizations towards ensuring a plausible payment and reward structure should embark on a collaborative approach. The collaborative approach in the inculcation of the PRP system should invest highly in open communication through involving of employees within the decision making. Involvement of employees in the decision making ensures that a dynamic, fair and equitable system prevails within the organization.
Reference List
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