Reward Management

 



What is Reward Management?

The practices and policies ensure the value of people’s contributions to achieving organizational and team goals are recognized and rewarded (Armstrong & Taylor, 2020). Planning, design and implementation of procedures and practices for rewarding the members are called reward management strategy (Armstrong, 2011).

Reward Management is not just attaching values but also adding values to employees (Goshal & Bartlett, 1995).

 

Financial rewards, Non-financial and Total rewards are the basic elements of a reward system.

Financial Rewards – pay-related rewards which recognized an individual’s contributions.

·         Pay determination is making decisions on the value of the job.

·         Base pay management is developing and operating pay structures.

·         Contingent pay is a planning and managing scheme which provides for pay progression related to performance, contribution and competence.

Non-Financial Rewards- Focuses on the needs of people addressing recognition, achievement and personal growth (Armstrong & Taylor, 2020).

Total Reward – various types of rewards such as base pay, employee benefits, contingent pay and non-financial rewards. which includes intrinsic factors of motivation (Armstrong & Taylor, 2020).

Figure 1: Total reward model (Armstrong & Taylor, 2020).

The proper way of managing rewards may benefit in many ways,

1.       Attract top talent

2.       Retain talented personal

3.       Strengthens the employee value proposition.

4.       Increases productivity

5.       Improves performance management of the organization.

According to Armstrong (2010) allowing rewards positively impacts on following areas,

·         Focusing attention on the values of the organization’s high performance and the behavior required to achieve it.

·         Performance expectations are defined and understood y the employees.

·         Encourage and recognize high performance.

·         Enhance engagement

·         Persuading talented people to join and retain in the organization.

 Outline

Reward Management is a very important aspect of motivating employees. It can be more rewarding and sometimes negatively impact employee motivation unless not managed very well.




References

Armstrong, M., 2010. Armstrong’s Handbook of Reward Management Practice. 3rd ed. London: Koganpage.

Armstrong, M., 2011. Armstrong's Handbook of strategic Human Resources Management. 5th ed. London: Koganpage.

Armstrong, M. & Taylor, S., 2020. Armstrong’s handbook of human resource management practice. London: Koganpage.

Goshal, S. & Bartlett, C. A., 1995. Changing the role of top management : beyond structure to process. Harvard Business Review, pp. 86-96.

 


Comments

  1. Tharindu Sanjeewa Gunathilaka 3 September 2022 at 14:31

    Reward is like a motivation machine. Small business can focus more on non financial rewards while large organisations cab focus on both financial and non financial rewards

    ReplyDelete
    Replies
    1. A Scholarly Chronicle4 September 2022 at 07:13

      Indeed monetary rewards are not effective in modern days. Thank you for your insight on this.

      Delete
  2. Harsha4 September 2022 at 12:16

    This is very useful blog about the reward management. The details are really useful for us.

    ReplyDelete
  3. Dinithi4 September 2022 at 15:25

    Some employees get motivated even with the word "Reward". So rewards can impact on whole organizational process.

    ReplyDelete
    Replies
    1. A Scholarly Chronicle4 September 2022 at 16:14

      Yes it is. Additional bonus is always a good feeling. Thank you for your feedback.

      Delete

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