Reward Principles and Performance Management in Organisations - Assignment Example

Reward Principles and Performance Management in Organisations Introduction Performance management refers to any strategy that relates to issues of general performance by employees in an organisation. These critical areas are the policies set and implemented by human resource departments. The areas are different cultures and styles adopted by employees, and the communication systems put in place by management of an organisation (Auginis 2009). However, these policies and strategies vary adversely according to the structure and main business of an organisation. The primary objective of performance management is to develop capacity in terms of both abilities and required skills for employees to achieve the set targets in an organisation. Further, it enables individuals within an organisation to discover their full potential, which enhances excellent performance in their tasks within an organisation. In addition, it aims at enabling non-performers within an organisation to do what is required. Communication is also an important component in this area where management aims at ensuring proper and organized communication within an organisation (Ashdown 2014). Also, reward strategies should also be considered to ensure that the performing employees are rewarded in the right way in order to motivate them. Main report The case study presented to us provides us with a real life situation in the organisation where Daphne Jones is appointed to be the personnel manager. According to her, the reward system of the organization needs to be analysed, and she gives her recommendations as discussed below in the essay. Internal and external challenges Performance management implementation in organisations faces a myriad of challenges. They can be either internal or external; hence, it is the role of management to ensure that all these challenges are handled with immediate effect. Firstly, the process experiences integration issues within the organisation. Communication and cooperation must be enhanced in all the departments that are involved in this system. In most cases, culture that has been adopted by the employees within an organisation always has an impact in these areas (Great Britain 2007). This is because they are people involved in departments, which are expected to enhance efficiency of the system in an organisation. All systems within an organisation must be harmonized to ensure the success and reliability of this system. This also comes in hand with design challenges within the system. In some organisation, some of the tools, which are designed for the system, do not address immediate needs of an organisation in this area. The heads of the departments involved are supposed to seek consultation from experts in the field of ICT and interact with colleagues from other organisations who have implemented a similar strategy within their organisation and it has been successful (Bacal 1999). Further, they must ensure that the people involved have the required expertise with them to ensure proper running of the systems. Secondly, most organisations experience poor leadership from top management in their organisations. In most cases, the parties involved in ensuring that implementation of this kind of a system in an organisation are not always committed to their designated roles and responsibility. They do not share the goals of an organisation to their junior employees who work under them. Hence, weak leadership contributes to the failure of implementation of this kind of a system on a higher side by management of that particular organisation. Therefore, it is always important for management to communicate their goals, visions and targets to the people who are supposed to ensure success of systems involved. For instance, in our case study, Jones critically analyzes the reward system of the organization and concludes that it should be modified to accommodate the immediate needs and reward employees who perform better that the others. Thirdly, implementation failure hinders the adoption of this system in an organisation. For it to be achieved, the management must implement an effective change process. This is because this is a new system that is being introduced into an organisation. Hence, management should ensure that it blends in with the culture that is adopted by employees in an organisation (Banks, 1998). Additionally, management should communicate on time with employees on the new changes that will be happening within an organisation. The whole process should be planned and organized strategically to ensure its success. Moreover, the challenge of incompetence is also experienced by organisations. Most employees in the organisation may lack the basic skills that are required to implement a system at hand. However, this is because of the innovations and inventions brought about by the developments in the world of technology (Beeres 2009). Therefore, it is the role of management to ensure that all their employees are trained on any emerging knowledge or expertise in order to fit in new developments brought by technology in organisations. Lack of proper rewards by management to employees also hinders success of the implementation process of the system. This is because they lack the inspiration and motivation, which they need (Greene 2011). This also goes in hand with poor communication from the management. In most cases, this challenge occurs in planning and design phase of the system. Failure to bring together all stakeholders involved in the process of change management, implementation and achievement of the set goals becomes difficult for the organization (Cook 2003). According to Jones from our case study, she points out that every employee should receive a one percent increase of their salaries to take care of the changing economic times. Further, she proposed that each of employees should receive a reward in the form of pay increase according to their categories of performance which she proposes. These are excellent, good, satisfactory and unsatisfactory. In my opinion, this will greatly motivate employees as they will work hard to be the best. Advantages of the proposed performance pay strategy Pay strategies that are adopted by different organisations has a number of merits to both the organisation and employees. In most cases, it is attributed and associated to improved performance by employees in a given organisation. Firstly, it gives an organisation a competitive advantage in the job market. Most people in the 21st century are attracted by organisations, which offer competitive packages and benefits in the market (Heusler 2009). Competitive advantage gives an organisation an upper hand in ensuring that they hire the best employees in an organisation. This equates to better and improved performance in an organisation. This kind of compensation enables employees in an organisation to manage expenses comfortably in the course of duty. It also acts as a source of motivation and the reason to work harder to achieve set tasks in an organisation. Therefore, most organisations should adopt and manage pay strategy system in their organisation as the benefits outstands demerits (Hudson 2003). Most analysts in this field also associate it with increased level and speed of innovation among employees in an organisation (Goss 1994). Secondly, pay strategy in an organisation greatly motivates the employees of all levels and managers in an organisation. The organisation must ensure that its motivation framework is in line with what is available in the job market in that particular industry. Hence, organisations must do an explicit research on prevailing conditions and trends in the job market to ensure that they offer the best (Hutchinson 2003). This can also be tied together with the ability of an organisation to attract new employees. In the job market in the world today, most job seekers look for opportunities in firms and organisations that offer best packages and benefits in their employment. Therefore, pay strategy system that reward according to the performance of employees can be an excellent source and form of attraction for job seekers to a particular organisation. Further, pay strategy in organisations supports and promotes talent development in employees in an organisation. Technology today has opened up many avenues for research and development in different areas. Hence, it is the role and responsibility of employees involved to take advantage of the situation and use it to develop and improve their knowledge and skills in different areas that are of importance to them. This is also necessary for them because they need to move with the latest trends and developments that relate to their roles in organisations that have employed them. Talent development leads to improved performance among employees, which means better pay by the end of the day. This promotes the growth of employees in their professions in their specified areas of expertise. Finally, it enables management of an organisation to identify and evaluate the non- performers in an organization and eliminates them with immediate effect. Disadvantages First, the entire process of evaluating all employees by the managers in various departments within an organisation can be time-consuming. This is because the process requires the manager involved to spend time analysing and evaluating a particular employee with his division and propose any compensation depending on his or her performance. Secondly, the process is not always a pleasant exercise because it sometimes discourages employees. Some managers may collect wrong information on an employee due to lack of keenness and concentration in the course of exercise. This leads to biases when it comes to rewarding employees as the top management will heavily relay of information and data that is given by managers in different departments (Lawrie 2004). Reward approaches that could be used to complement or replace the proposed pay strategy Pay strategy remains to be the approach in performance management. However, organisations can adopt other means of motivating their employees for their good performance. This could be through giving them bonuses and incentives on specific tasks accorded to them. Other benefits such as health and insurance benefits can also be given to these employees. Further, equal pay and pensions should also be given to the employees who work to complete their allocated tasks by an organisation. Difficulties that managers experience in the line of implementing reward strategies Managers experience a number of challenges in the course of implementation of the strategy. The main challenge they face is a lack of proper communication from all levels of management in an organisation. When top management fails to communicate effectively to all stakeholders involved, they will not know the targets and the goals of an organisation; hence, they will work less hard towards achieving it. Weak leadership and mentoring of the employees is also a challenge to the managers in various divisions. This is because they delegate duties to their juniors within the departments. They may face a challenge of unclear roles, which they are supposed to take in a given project. Thus, leaders in different levels should clearly communicate and delegate different roles and responsibility to their juniors and enhance proper communication the course of completing the task (Marsden & Kelly 2006). Further, managers are the people who feel the effect of lack of motivation by employees in an organisation. De-motivated employees are not active and determined to achieve the goals and target of the organisation. It is always important for the management of the organisation to conduct a survey and understand terms and benefits that similar employers are giving their employees in the same bracket. Additionally, managers also face the challenge of incompetent workers in their departments. The world today is experiencing a revolution that has been brought by the advancements in the world of technology. As a result, significant development are happening which requires the employees to be always updated. However, some of them are reluctant and do not take the necessary steps to learn new developments in their profession. This always affects negatively their performance at the workplace. Recommendations The management of an organisation should ensure that there is proper communication within all departments in an organisation. This is imperative for coordination and planning of all systems that are incorporated in the change management system. In addition, employees will be aware of their expected roles, responsibilities, as well as the goals and the targets of the organization. Approaches for motivation of employees should also favour the interests of employees. Apart from the pay strategy, other approaches could also be adopted to satisfy and appreciate a good performance from the employees. The reward system that is adopted by the organisation should fit the needs of their employees. However, they should also show interest in learning any change and trends that are happening in their profession. This will ensure that they are competent in performing the roles and responsibilities which are accorded to them by the management of an organisation (Murthy 2007, p.21-29). In addition, all the system within an organisation should be integrated to support any change that would be happening in the organisation. Another important aspect that must be ensured will be proper monitoring and evaluation of the system after its implementation. This enables the top management to identify and work on any challenge that has been identified. Proper evaluation by all parties involved should also be conducted to ensure that all follow ups that are required. References AGUINIS, H 2009, Performance management, Pearson Prentice Hall, Upper Saddle River, N.J. ASHDOWN, L 2014, Performance management, retrieved 04 November 2014, < http://www.books24x7.com/marc.asp?bookid=68037>. 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HUTCHINSON, S 2013, Performance management, Chartered Institute of Personnel and Development, London. LAWRIE, G 2004, Strategic performance management, Bradford, England, Emerald Group Pub, retrieved 04 November 2014, . MARSDEN, G., KELLY, C., & SNELL, C 2006, Selecting indicators for strategic performance management, Transportation Research Record, pp. 21-29. MURTHY, C. S. V 2007, Change management, Mumbai [India], Himalaya Pub. House Pvt. Ltd, retrieved 04 November 2014, < http://site.ebrary.com/id/10415538>. Read More