The Motivation And Rewards Management Essay

Motivation and rewards has been chosen as our topic for this assignment. Motivation and rewards is very important for any organization or even any industry. Motivation is a behavior that cannot be created but can be influence while rewards are something that the employees gained from doing a good job in their work (Thomas, 2009).

AirAsia was the company that chosen for this assignment. AirAsia do implement the motivation and rewards in their company successfully. AirAsia is a low-cost airline business which had become more and more popular around the world. AirAsia was established on year 1993 and started its business in year 1996 (McNamara & Troftgruben, n.d). Government owned corporation is the found of this company. AirAsia is the largest company that introducing pioneer of low-cost travel and largest low-fare and in Asia and they have their slogan which known as “Now Everyone Can Fly”.

AirAsia is a successful example for other airline companies. It has been transformed as an unthinkable concept to be successful in airline industry. This success can be proved from a money-losing task to profitable. Although AirAsia introducing no-frills service to their customer and using second hand aircraft, but it would still be a threat for other Asia airline companies (Michael Swathe, 2011). AirAsia have a very good performance in consumer mind by offering low fares, majority on-time record for flights and maintaining staff with high productivity and work ethic.

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Based on the information in Indonesia Straits Times, it is stated that in August 2011, Malaysian Airline form an alliance with Air Asia but the agreement of both airlines were voided because the alliance was struck down by the Malaysian government. (Leslie Lopez, 2011) AirAsia now is a successful airline company which expand from 2 planes to 80 planes and from 200 000 passengers to over 75 million passengers in 7 years time. It is a visible success that we can see year by year. (McNamara, 2012)

Content

Motivation

In management, motivation defined as a power to force someone to work in certain way so that it able to reach certain desired goal. As what people always said, motivated people always work harder as compare with those unmotivated people. According to Lavinsky (2012), a company should make the employees feel doing something meaningful. As a result of a survey done by BNET show that majority agrees doing something meaningful were the most motivating things about work.

According to Lavinsky (2012), motivation is internal and external factors that inspire employee interest, in which they need to, listen, focus and understand employee needs and wants through an effective communication. A company manager should change the question from Whom to How. An example given by Lavinsky (2012), say ‘How we can improved this process?’ rather than, ‘Who screwed up this up?’ This action might able to motivate the employees so that they will be more careful for their work so that won’t disappoint their company.

To have motivated workers, a manager must treat workers as individual, empower employees, redesigning jobs, and provide a comfortable and flexible workplace. Below are the meaning of the effective management practices (Griffin, 2006) :-

Effective management practices

Description

Empowering employees

Empowering employees means that giving the individual in an organization authority, autonomy, trust and encouragement to complete their tasks.

Redesigning jobs

Redesigning jobs is one of the best motivations in the workplace. Usually individuals go to work every day doing the same routine. This makes the workers become less motivated. Something actually can be done by the managers to improve the condition before the employees become de-motivated and bored. The way that manager can use is job redesign. Concern and knowledge are required for managers and have them bring it with them to the organization and then apply motivational theories into their work to improve the productivity and satisfaction of the employees.

Creating flexibility

World nowadays is all about flexibility. People nowadays have too much things to take care of but they do not have enough time to do it. Employees value more about personal time. Due to the family needs, a traditional nine-to-five working hours every day except Sunday may not work for many people. Therefore, flexibility which let employees to control and set their own working hours is the best.

In AirAsia point of view, they believe that their entire staff act as contributor for the company, therefore, they always been treated as a big family and equally. This is an example of empowering employees. The company will have constantly talked with their employee in order to understand their needs and wants. They will organized a monthly staff forum and create some fun programs to help them release their working stress. In the event, they also give employees an opportunity to speak out their point of view towards their working place (McNamara, 2012). According to Zhu (2010), even though the salaries gave to employees were low, but all employees were giving broad range of incentives. Such as, share offers stock options, productivity and performance-based bonus. Those motivations may give employees sense of ‘ownership’ and it able to improve in effective and focused workforce.

Despite that, Airasia employees are able to perform in multiple roles in flat organizational structure because the airline has implemented a flexible work rules (Zhu, 2010). This can be an example of creating flexibility. Flight attendants also can be work at check-in counter. They can change to different department after they work for one month. By doing this, the employees won’t be bored to working in the same area. Flexibility will motivate the employees to work harder because they are happy with all the flexible rules given and thus, they can gain more experiences in that industry. Even though AirAsia always try to minimize their expenses cost, but they are very determined on employee work ethic. Therefore, AirAsia always provided their employees the best training and ensure that they are happy in their working place. (Foo, 2012) This can be called as redesigning jobs. As a result, AirAsia gets to establish a numbers of quality and excellence employees because the employees are satisfied with their jobs that are always fresh to them.

Reward

A reward is a scheme to support desirable behavior. Rewards can be in terms of financial and non-financial. Example of financial reward is bonus pay and example of non-financial reward is degree of achievement, opportunity to growth or even praise from the top management or manager for doing a good job.

Reward is different from motivation. Reward is something that the worker or employees gain from putting effort in their jobs while motivation is something that they need to have in order to put more effort in their jobs. Intrinsic and extrinsic are the two types of rewards that can motivate employees. (Mcrill, n.d ).

Types of rewards

Description

Intrinsic rewards

Intrinsic rewards are self-administrated. An intrinsic reward refers to the motivation that comes from inside of an individual rather than from any outside rewards such as bonus, gifts and so on. It is an outcome that gives an individual personal satisfaction such as an experience after completing a job, professional growth and sense of pleasure. The individual will feel good because he or she have the feeling of learning and achieving something which can be also called as personal development. Besides that, the individual will also have the feeling of competency and self-control over her work. The motivational stimulus in intrinsic do not depends on the actions of other people. People always trust that the most powerful rewards come from a person’s inside.

Extrinsic rewards

Extrinsic rewards are externally administrated. Extrinsic rewards are usually can be seen like financial in nature. For example, an increase in wages, special assignments or incentives for reaching some quota. In addition, extrinsic rewards can be also as simple as getting a verbal compliments, public recognition, and awards for achieving something, promotions and some other extra responsibility. The motivational stimulus in extrinsic depends on the actions of other people which is also opposite from the intrinsic rewards because it originates outside the individual. All those rewards are very important for most of the workers therefore the rewards can be motivating. They will feel they are valued or been appreciated.

In every management, intrinsic reward is a must to be given to the employees. While in AirAsia, they have a very good relationship with their employees. Employees reward given by AirAsia is very worthy. Every year, some of the employees will be chosen to get free flights to different destinations if they do well in their jobs. They also provided up to 90% of discount for their employees on concession travel. This encourages employees to put more effort on their responsibility in order to get the rewards.

Besides that, AirAsia awarding bonuses based upon each employee’s contribution to the company productivity, and expects to increase loyalty through its ESOS (Employee share awarding scheme) which will be available to all employees and it also may help employee to improve their performance. The group’s management encourages open communication which creates a dynamic. AirAsia also awarding long service awards for their employees who work more than 10 years.

Motivation and Rewards

Although its mention above that reward is different from motivation, under some circumstances, reward able to build in motivation. In social psychological terms, it also referred as ‘the hidden cost of rewards’. According to Frey (n.d), he has using an economic concept to define this theory, which is bonus against effort. A purely price effect shown increase in bonus also can increase employee effort towards their work. In other word, motivation always link with reward.

AirAsia do apply this in their management. Not only AirAsia, even other companies will do. Before they serve the customer, they do find many ways to satisfy the employees such as giving motivation and rewards. When the employees are satisfied and happy with the job, they will be more enjoying and run their tasks better. Thus, AirAsia customers will be treated in a better quality of service.

Lastly, as what have discussed above, a financial or non-financial rewards might given by the company to their employee in order to motivate them to be more responsible towards their job. Example, AirAsia award bonuses to their employees based on their performance, so it is a kind of motivation that able motivate their employees to work harder in order to achieve the desired goal, which is to get the bonus.

Findings

Multiple roles performance of AirAsia in a flat organizational structure has the possibility as mentioned by Zhu (2010) which is to compromise the AirAsia’s production in the future as it evolves. The efficiency and the effectiveness on task maybe lowered when multiple tasks assign to the employee. This is because employee will feel de-motivated when the job scope assign to them is too wide for them to focus on the job. Besides that, too wide of job scope and multiple task assign to employee can lead to confusion on the job in the organization. Hence, this could possibly result in a low efficient state for the AirAsia as the organization trying to expand for a better growth and affecting the airline’s productivity indirectly because the ability to perform is a short-term worthwhile competitive advantage due to over dependence on the employees (Zhu, 2010).

http://business-strategy-competition.knoji.com/strengths-and-weaknesses-of-airasia/

Moreover, Air Asia receives a lot complaint from customers on their service (Solano, 2012). There are several complaints has been made from the Air Asia customers. Flight delays, unnecessary charge payment being conduct and not able to change the flight or get a refund when the customers could not make it on the booking date were some of the complaints that the customers made. There are also complaints like bad services from the staff that are in charge on the particular shift. Besides that, as what stated by Solano (2012), Air Asia did not have their own maintenance, repair and overhaul (MRO) facility. Therefore, if Air Asia continually received the same complaints and did not make any improvements on the spot, this would result the loss of customers and also the productivity of the company. As confidence and satisfaction levels of customers drop, it affects Air Asia profitability.

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In addition, Air Asia has fast track promotion as what mentioned by the Malaysia Airline Families. Fast track promotion actually means that it is the fastest and most direct route to achievement. Malaysia Airline Families says that if an employee worked for Air Asia since 1997, his or her salary will still remained based on the last drawn salary as of year 1997. Last drawn salary is the last drawn monthly essential salaries which also includes the pension allowance. When the payment of salaries are below their expectations and no increment that is being awarded from year to year, this could lead employees to be de-motivated from working in the organizations. Despite that, they might plan to shift to the other company that provides them with increment that they think they should have it. (Malaysiairlinefamilies, 2013)

http://airasiafamilies.wordpress.com/category/experiencing-bad-services-with-airasia/

However, Air Asia’s employees were not unionized as been stated by Zhu (2010).Air Asia policy was mainly focused on maximizing efficiency and productivity of the company. Besides that, Air Asia also tends to keep their staff costs at a consistent level with low-cost carrier industry standards. This means that the Air Asia employees were provided with a wide range of incentives. Even though salaries offered to the employees were lower than the salaries of their rivals, at least Air Asia still offer their employees with a wide range of incentives. This shows that Air Asia still give their employees some benefits. The awards being given to the employees are the performance-based bonuses (PBB), share offers, and stock options (Zhu, 2010).

http://business-strategy-competition.knoji.com/strategic-actions-adopted-by-airasia/

Other than that, pilots in Air Asia were provided with some rewards or benefits to improve the flight operation. Air Asia adopted a sector pay policy. They can both keep flight and minimum their operating time. Besides that, flight sectors can be covered as many as possible within a day. Therefore, Air Asia adopted a sector pay rather than an hourly pay scale for their pilots. Moreover, Air Asia gets to cut down the number of cabin crew or can be said by saving on employee’s cost is because of the absence of the in-flight services (Zhu, 2010). This can be said as a method of minimizing organizational expenses. It is a trend in the global airline industry nowadays especially in the Air Asia.

http://business-strategy-competition.knoji.com/strategic-actions-adopted-by-airasia/

Recommendation

We highly recommend that the management of AirAsia should reconsider their training course for their employees and provide re-training if possible. According to Adams (1998), management training courses fail because they: (i) are too generalized; (ii) fail to meet the specific needs of trainees; and (iii) fail to take into personal characteristics such as age, educational back-ground, previous work experience and willingness to participate in training. Besides that, Analoui (1997) mentioned that considering the perceptions, personal interests, objectives and preferences of trainees’ could result in greater understanding of training objectives. Hence, employees will have a clearer view of the roles in performing a certain task and carry it out more effectively. Role perception is one of the MARS model component which affects employees voluntary behaviour and performance. The management can kill two birds with one stone by implementing it because it will increase the effectiveness and efficiency of the management. For example, every actions performed by the employees is in the best interest of the company and not otherwise.

Besides that, AirAsia’s management should also further improve on their organizational (affective) commitment in the workplace. Affective commitment – is the employee’s emotion attachment to, identification with and involvement in a particular organization. In another word, affective commitment is a person’s feeling of loyalty to the place where he or she works. First and foremost, organizational commitment can be boosted via organizational comprehension. This refers to the overall comprehension of the organization, including its strategic direction, social dynamics and physical layout. For instance, giving staff information and opportunities to keep up to date about organizational events, communicate with co-workers, discover what circulating in different parts of the organization and study about organization’s history and future plans. Besides that, trust is the key to unlock employees’ loyalty. This refers to the positive expectations that one person has towards another person or group in situation involving risk. AirAsia should increase employees’ job security to enhance trust that employees have in the management and the employment relationship.

Last but not least, Four-drive theory can be practically applied to the management of AirAsia. The theory explains the innate drivers to acquire, bond, learn and defend and that incorporates both emotions and rationality. Besides that, emotions play a central role in employee motivation. These drives create emotions, which represent the prime mover or source of effort of individual behaviour. The first recommendation is that the management of AirAsia should create a best workplace that helps employees to fulfil all four drives. Therefore, the management should provide sufficient rewards, learning opportunities, social interaction and so forth for all employees. The second recommendation is that fulfilment of the four drives must be kept in balance; that is, AirAsia should avoid too much or too little opportunity to fulfil each drive because the four drives counterbalance each other. For example, change and novelty in the workplace will ease the drive to comprehend but too much of it will initiate the drive to defend to such extent that employees become territorial and resistant to change. Thus, it is vital for the management to provide balanced opportunity to fully utilize it.

Conclusion

Air Asia as known by everyone that a successful and well established airline company not only in our country Malaysia but also in the world. There have many way to define the successful of this airline company, one of it is using the correct way to manage the company, and the way is motivation and rewards towards the company, all of that we had mentioned above. Everyone knows that human capital is important for a company, and the human capital of a company means is employee of one company. A motivated and rewarded employee can be a productive employee. A productive employee can be a very profitable employee. While employees that are de-motivated, they will become less productive, less creative, and this may cause less of an asset towards the company. Now more than ever, company needs motivated employees. When the employees become more productive, the company will also become more productive, while productivity of a company increase, the profit of a company will also increase. With this the company will stay in the competitive business and ready to go conquer the world.

In this assignment, we have learned much of things, one of it is motivation and rewards are a good corporate culture that will direct a company to a successful way. Furthermore although Air Asia is a successful and well established airline company, it also may have some weaknesses that we mentioned in the findings part, but that is not a problem. We just need to find out the way to solve the problem. By this a company just can continue leading in the industry and unscathed in this kind of we call it competitive and cruel business world.