Reward.

Why Total Reward?

- Forms part of strategic approach. - Current employee/employer relationship looks quite different today than it did 30 years ago. - Importance of tangible and intangible rewards. - Employers have more subtle demands, which employers are reacting to, creating more complexity in terms of attraction and retention.

Total Rewards Approach.

- Holistic. - Best fit. - Integrative. - Strategic. - People-centred. - Customised. - Distinctive. - Evolutionary.

Benefits of Total Reward.

- Increases organisational performance by generating greater workforce commitment and motivation. - Improves recruitment and retention. - By quantifying the total value of the employment package can prove valuable recruitment tool. - Reduces recruitment costs by owering turnover. - Supports HR objective of positioning organsation an an employer of choice. - Promotes flexibility in pay delivery. - Means of relocating reward to match individual employee needs. - Helps manage costs and maximes HR investments. - Improves employees overall perception of the value of the reward package. - Mix of extrinsic and intrinsic rewards has more impact on people's discretionary effort. - Ensures that work-life initiatives are part of a well integrated reward and HR strategy. - Difficult for competition to copy.

The Aims of Rewards Management.

- Rewards people according to what the organisation values and wants to pay for. - Reward people for the value they create. - Reward the right things to convey the right message about the organisation's values. - Develop a performance culture. - Motivate people, obtain commitment and engagement. - Attract and retain the best people. - Develop a positive psychological contract.

Drawbacks of Total Reward.

- Time-consuming. - Easier to believe that total reward is a good thing than to put it into practice. - Requires managers to adopt a comprehensive approach to reward management. - Requires full support of the management team. - Cost of some intangible rewards not quantifiable.

Intrinsic.

An outcome that gives the employee a personal satisfaction, such as praise for a job well done.

Employee Reward.

A reward may be anything tangible or intangible that an organisation provides to its employees either intentionally or unintentionally in exchange for the employee's potential or actual work contribution, and to which individuals attach a positive value.

Extrinsic Reward.

A reward which is tangible and is physically given to an employee for achieving something. They usually have a monetary value such as a bonus or an award.

Performance Based Review.

Benefits to organisation and employees: - Employee retention. - Commitment. - Recruitment cost is reduced. - Motivates employees to perform better and align with organisational goals. - Employees understand what needs to be done to meet goals. - Employee involvement increases which result in autonomy, productivity and satisfaction. - Employees feel part of success, enabling confidence and innovation. - Employees volunteer to work on challenging jobs to increase their recognition level and reward. - Employees have the opportunity to enhance skills and develop their career.

A Powerful Argument for Total Reward.

Creating a fun, challenging and empowered work environment in which individuals are able to use their ebilities to do meaningful jobs for hwich they are shown appreciation is likely - even though creating such an environment may be more difficult and take more time than simply turning the reward lever.

Aims of Payment Systems.

Fairness: - To support and develop organisational culture. Performance: - To encourage and reward employees. - Define right behaviours and outcomes. - Promote high performance. Competitiveness: - To secure competitive advantage. - To support key elements of the organisation's strategic plan and business goals.

Total Reward.

Five separate components of the work experience in addition to pay and benefits: - Recognition. - Employee Development. - Environment including job design and physical workspace. - Company Culture. - Work/life balance.

Flexible Benefits.

Fully Flexible - Full freedom of choice up to a specific benefits limit. Core and Options - Compulsory core of benefits with flexibility beyond that. Menu Choices - Menu, A/B/C , much like a takeaway.

Pay as a Motivator.

Maslow argued that pay is a motivator at lower levels when employees are addressing physiological needs. However once satisfied, pay does not motivate higher levels of performance as elements such as self-esteem and self-actualisation become important.

Total Reward Concept.

The concept of total reward encompasses all aspects of work that are valued by employees, including elements such as learning and development opportunities and/or an attractive working environment, in addition to the wider pay and benefits package.

Reward Management.

The terms 'reward' generally covers all financial provisions made to employees, including cash pay and the wider benefits package (pensions, paid leave and so on). It can also include wider provisions for employees, with the term 'total rewards' encompassing non-pay benefits.

Adams Equity Theory.

What employee puts into the job should equal what they get from their job. People become demotivated, reduce input and/or seek change/improvement whenever they feel their inputs are not being fairly rewarded. Fairness is based on perceived market norms.