How To Reward Employees In Order To Motivate And Retain Them Business Essay
“What is motive? A motive is a reason for doing something. Motivation is concerned with the factors that influence people to behave in certain ways.” (M Armstrong 2006, pg: 252)
M Armstrong (2006) in agreement with Arnold et al (1991) suggests the components of the process of motivation as follows:
direction- what a person is trying to do;
effort- how hard a person is trying;
Persistence- how long a person keeps on trying?
Reward - On the other hand reward is something that achieved by employee through their hard work. It can be financial (basic and performance pay) or non-financial (promotion, recognition, achievement and praise).
The management guru's of the 1960's (Maslow, Herzberg, McGregor, McClelland), in their theories they said very simply and straight forward about the motivational theory.
Maslow mentioned in his theory in the western country people were satisfied with their basic needs so money weren’t able to motivate them (money can buy the fundamental requirements but not able to buy affection, relationship or self esteem). Managers who were following this theory diverted their concentration to offering supplementary pleasing relationships, more fascinating work, and extra opportunities for self-fulfillment.
Managers who pursued Herzberg, they rejected also money as a motivator and put attention on supplying more job enrichments.
Employers who followed by McGregor they also ignored the idea of Theory X and proposed Theory Y which led them that people normally wants a good job with ample opportunities and manager should offer opportunities to do a job done.
McClelland focused interest on providing people the chance to convince their needs for accomplishment, power, and relationship.
Link between motivation and reward
Theory of motivation
Implications of reward system
Hourly or weekly wage/salary with no incentive element;
Well working condition, well pay, flexibility, appreciation at work and giving promotion.
Emphasis on motivating through human relations and skills, job enrichment or opportunities to satisfy higher order needs such as achievement.
- a refinement of Scientific Management
Payments directly linked to effort, care taken to ensure employees believe they can achieve the effort, that the rewards are desirable, and that performance will improve, and produce the expected reward if they put in the effort
CONTINGENCY or "BEST FIT" THEORY
Payment system designed to suit the contingent organization features and the kinds of employees
REACTANCE THEORY and "Best Practice"
Key features of best practice incorporated:
Extensive consultation and involvement during planning and implementation
Team based performance payments
Clear specification of what needs to be achieved or improved
4(B) Evaluating the process of job evaluation and the main factors determining pay
The Process of Job Evaluation
“Job evaluation is a systematic process for defining the relative worth or size of jobs within an organization in order to establish internal relativities. It provides the basis for designing an equitable grade and pay structure, grading jobs in the structure and managing job and pay relativities.”(M Armstrong, 2006, pg: 660)
Job evaluation is really a lengthy process and it must have to follow some in a systematic approach. At the beginning of this process management must clarify it to its employee the purpose of this program and importance of it. After that a committee has been fixed where all the experienced HR specialists and employees are included. On the next step organization selects the job from the each department that they are going to evaluate. Then the selected job analyzed by the committee in detail. In this case they do check the task has been given to the employee, does he completed/ performed well on it or not? It helps them to prepare the job description very easily.
Next, the committee chooses a method for the job evaluation. There are several methods that has been using for evaluating a job. Analytical- points rating, factor comparison, proprietary brands; and Non-analytical- job ranking, job classification, paired comparisons these are two schemes/method that has followed to evaluate a job. For depending on the job criteria committee chooses the method. Thereafter, committee classifies the job on the basis of its importance and then when the process is completed the committee/management explains it to the all employees to clarify the confusions.
The other factors determining pay
The pay which is awarded to a job can be influenced by many factors and that creates some variation between the roles and the organizations. Those factors are as follows-
Size of the organization- The size of the organization (revenue/turnover/employee figures) is one of the factors which determine the post for the senior jobs and junior one also. So depending on the size of the organization the owner/head of the institution decides what figure they should pay to director, manager and the other junior post.
Seniority- This is the important factor for determining of pay. Because by considering rank/level of the job it can be varied.
Skills and experience- It is important to have proper skills for a particular job and also experience is another significant issue that company look at. By considering those two issues organization determines the starting salary/wages
Industry sector- In the industry sector specialist/senior job has important contribution to carry out the business. There has a good variation in one industry to another in the sector of determining pay.
Location/geographical area- the location/geographical area also influenced to determine the pay. On this aspects level doesn’t affect on the figure that company determines to pay. For instance, some of the areas where the living costs and other expenses are so high and comparatively organization pay the employee historical salaries/wages in this situation.
Type of services- Depending on the service organization selects different figures of pay. For example, an IT security consulting officer get pay more than the marketing officer.
Profitability of the organization- If the company has highly profitable business then employees has some chance to expect more wages/salaries.
Employee performance has good impacts in the organization which helps employee to get pay well.
The level of education has an effective impacts in the section of determining pay
Task-3© Assess the effectiveness of reward systems in different contexts
Bratton & Gold (2003) define a reward system as ‘the mix of extrinsic and intrinsic rewards provided by the employer... it also consists of the integrated policies, processes, practices and administrative procedures for implementing the system within the framework of the human resources (HR) strategy and the total organizational system.’
Effectiveness of reward systems:
Motivate employees- For developing the organizational performance motivation is one of the strongest components. Reward is a kind of motivation. Where employee get well motivation they perform well there.
Develop organizational efficiency- It helps organization to achieve its goals and objectives. Because of reward system employees get proper support and satisfaction from the company and try to do well for themselves and the company also.
Enhancing the employee relationship- The reward programs are more relational orientated to the employee. It has some great advantages in the term of increasing the better relationship with the employee to the organization. Well understanding does work as an opportunity of organization success.
Improved performance- It helps employee to do good performance because by doing this he/she can get extra reward forms the organization. So if employee knows that by doing good performance they will be rewarded by company, that time they put full potentiality which helps to improve their performance.
Improved skills and knowledge- When an employee performs well get reward from organization. By the side of this reward they also put their efforts, skills and knowledge which help them to learn something new. Then they gain some skills and knowledge and earn some believes also on their abilities which all are comes as a reward.
Increased Commitment: It also helps to enhance the commitment of employees to the organization. Employee wants themselves to keep them as member of the organization, willing to pay strong and considerable effort and by the time goes make a strong belief on the goals, objectives and values of the organization.
Increased profit- Company has good opportunity to make profit because employee works sincerely and attentively. Not only that it also helps to deliver positive psychological contract between employees and the organization and creates a better working environment and assists organization to keep talented, potential employees with them.
Loyalty from employee- It helps company to get loyalty from employees because they feel respect and value on themselves.
Task-3 (D) Examine the methods organizations use to monitor employee Performance
There are several methods that have existed to monitor employee performance. It should be monitored and evaluated regularly. Feedback — that employee wants to know about their work progress from the supervisors. It provides good opportunities for employees to accurate his/her absences.
Performance appraisal is one of the structured and formal methods designed to determine the real job performance of a worker against chosen performance standards. In an organization worker would be interviewed to talk about his or her performance given that the last appraisal, to recognize strengths and weaknesses, and to create an accomplishment map about how weaknesses, can be enhanced and how strengths can be increased.
Appraisal by manager- On this method used the immediate manager who is directly involved with the activities of employees and has greatest knowledge about the employee and he is the person who give the formalize feedback during the working year.
Subordinate appraisal- On here, staffs is directly reported to the employee about his/her performance.
360 degree appraisal- On this system all the parties (employees/customers/managers/peers) who come into contact to the employee about his/her performance.
Peer appraisal- Here, employee performance appraise by the same level of employees because co-worker has the most familiar experience about the performance of the employee.
Self appraisal- Here employee appraises his/her performance and in this case employee compares themselves with others or management reviews.
Observation and Feedback is another way to measure/monitor the employee performance. On this system organization employ someone for observing the performance of the employee and after providing feedback straightforward. By observing and providing the feedback organization can give the exact shape to the employee which is expected to them. This is similar with coaching and it helps organization and even employee to give likelihood results that company wants to the employees.
Performance Standards is one of the employee performance monitoring system where performance has been compared with the standard and there employee need to fulfill this standard. Under this system performance must have to be realistic, measureable and must have be expressed in terms of time, quality, cost, quantity, effect, manner of performance, or method of doing it.
Task- 4(A) Identify the reasons for cessation of employment with an organization
There are many variety ways that employee assists to leave their organization, has a number of situations and for a diversity of causes. The reasons why employees depart their present job can be divided into two categories; voluntary and involuntary.
Voluntary reasons include-
To receive or take control to another post.
Retirement or voluntary early retirement.
Voluntary non-employment, which could be due to a change in circumstances for example, parenting or studying.
People taking up another post may be doing so for a number of reasons such as-
Personal reasons for moving to another geographical area.
Because they have been offered better terms to do the same work with another employer.
Opportunities for promotion.
To escape from uncongenial managers or colleagues.
A desire for a change in career.
The following issues are some of the reasons for cessation of employment in an organization-
Resignation- There is a few numbers of reasons that an employee apply to resign or terminate his own employment. Not happy from the job, better opportunity in elsewhere or some personal reasons.
Lay off- If organization is performing or facing some financial problems or if they don’t need that particular job then the company decides to lay off its employees.
Employees long time disabilities.
Employee’s retirement or death.
Discharge for violence such as- sexual assault, workplace violence, conflict of violence, unlawful discrimination and harassment.
Poor job performance, by misusing the secret information/data, fighting or for stealing something from the company.
By show some of other voluntary causes of termination.
4. (B) Describe the exit procedures used by two organizations
Employees can exit an organization in various conditions they can quit voluntarily to further their career, acquire more money, move away from the area, retirement, voluntary redundancy or because they are simply fed up with the way they are treat by the organization.
Involuntary release occurs whereby the organization no longer wishes to continue with the employment relationship this can be as a result of dismissal or redundancy. This section of the report will focus upon how exit procedures used by two organizations and how they manage the whole process. Armstrong (2003) claims this process to be one of the most unpleasant, difficult and stressful HR activities.
Hampshire County Council is dedicated that they will apply the best way to deal with their all employees in the application. The method they are following is measured to offer a meeting for the swap/exchange of information with the aim of giving the nonstop development in working affairs and the working atmosphere.
The Line Manager is the person of Hampshire County Council where the effort made by himself in the case when receive a resignation. Before resignation is accepted, manager talks about the issues of the resignation with the employee. In the discussion he believes that there has some possibility to keep the employee by changing some of the employment condition. If it doesn’t work then he informs Human Resources that employee is leaving and confirms the date that employee is leaving. After that HR send the form for Exit Interview to employee. Then HR ask employee about any matters (annual leave entitle, any property that employee want to handover) that employee want talk in the interview. The HR also asks about sharing the information with the line manager (before or after). The HR assembles leaver information (including the contact information and the outcomes of the interview) and keeps it into the employee file as a record.
On the other hand for the Pizza Hut Restaurant, employee must have to inform the business manager or the store manager at-least two weeks in advance for his/her resign. Here the manager first try to discuss what is the reason behind of it to leave this job. Manager tries to create some positive atmosphere which can help him to retain the employee. But if manager unsuccessful to convince then between those times frame the store manager manage all the official process for the employee resignation. The manager first of all informs it to HR manager about the resignation of the employee. Then the manager provides a form to the employee where it is clearly mentioned the termination/cessation dates of the employee and some of the other issues like- the wages/salary that the company to the employee, if there any other annual facilities that should provide to the employee, or any other property that employee should give back to the company. Then manager accepts the resignation and sent the letter including the form to the HR Department.
Task-4© Impact of legal and regulatory framework on employment cessation arrangements
There have so many good advantages/impacts/effects of legal and regulatory framework on employment cessation arrangements. The following are some of the impacts of it.
Enhancing the job security- First of all, it provides/assures the security for the Job to the employee. If anything happens with the job like removing or firing from the job then can get a solid support from this framework. Everything has a perfect procedures and employee can’t get rid of until following any right procedures by employer.
Reducing the discrimination at workplace- It has some far reaching effects in the terms of reducing the discrimination. Under this framework employer can’t dismiss someone by depending on the religion or belief, sexual orientation, color, sex, race or ethnicity. If something occur basis on those issues then employee will get 100% support from this framework.
For minimizing constructive, unfair and wrongful dismissal- This framework also help the employee from constructive, unfair or wrongful dismissal. Constructive dismissal happens when the company broke its terms without any agreement. In this case employee resign from himself/herself. Unfair dismissal for instance if one employee of the organization is pregnant and that why she is sacked from the job. On the other hand wrongful dismissal is something when company dismisses someone without any notice. In those cases, it gives the proper support to the employee.
Provide assurance in some financial aspect- In some reasons when employment come to the end for example redundancy, retirement, capability or resignation employee must entitle to get the outstanding money from the employer and it has clearly mentioned on the act. If employer wants to ignore this act then they can be charged a big amount under this policy.
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