Income Support Program like a Guaranteed Annual Income - Case Study Example

Income Support Program like a Guaranteed Annual Income and Work Incentives Organizations are structure with a ‘collage’ of humans doing their allocated work under the supervision of a leader. These humans or workers will be apportioned different roles according to their educational qualifications, experience, skill, knowledge etc. After the recruitment and apportionment is over, it is the duty of the organization to provide the managers and employees an optimal working environment and an optimum incentive program as part of that environment to retain them maximally. In that environment only, employees will show optimum excellence. But, sometimes the organization will not be able to provide a best working environment due to various factors. This will surely bring down the level of excellence among the managers and employees to bare minimum. With less than effective incentive program and less motivation, the employees will be hard-pressed to use his/hers physical and mental part, and could even consider exodus. So, the important aspect is, the motivation levels of the employees have to be kept at optimal levels with the aid of incentive program, so that the employees exhibit optimum excellence and retention. So, this paper will look at how motivation, excellence and importantly retention levels can be optimized by developing an optimal incentive program for the managers and the employees Background The mind of the worker is the crucial thing that will make an organization work. Biologically, it is mind of the worker, which will make the worker ‘work’. That is, only if the mind of the worker is filled with positive thought process, it will get motivated and make mental as well physical organs work for the benefit of the organization. The motivated mind will only ‘configure’ the mind as well as the physical body, to function in an optimum way or even ‘push’ them in a maximum way to derive beneficial outputs for the workers themselves as well as the organization. Importantly, the motivated mind will only make the employee stick to the organization. And the useful strategy which will optimize the motivation levels and thereby retain them is an effective incentive program. This strategy plus incentive program can be implemented by the leader in any environment with good results. Employee motivation and thereby retention is an essential and crucial priority for survival and success in today's competitive marketplace. Implementation of an effective Appraisal system before the introduction of an optimal incentive program When one thinks about an industry or an office or an organization, the ‘picture’, one gets is of infrastructure, machines, etc (in case of industries) and papers, computers, cabins, etc, (in case of offices). But, the crucial thing that the mind leaves out is the picture of a working employee. Employees only form the crucial part in the running of the organization. If these crucial employees are recruited optimally, then appraised optimally and finally rewarded optimally, the organization can achieve optimum success by retaining the core group of employees. Employees can put an organization in an effective state in terms of production, sales, profits, etc. After recruiting the apt workers, organization have to appraise them aptly. Performance appraisal or employee appraisal is a method, in which the performance of an employee is evaluated, particularly in terms of productivity, time factor in productivity, quality of the work, etc. Based on this appraisal results only, employees will be given promotions, incentives and salary hikes - in case of positive results, training, coaching and mentored – in case of positive and negative results, and finally cut in salary, suspension or even dismissal in case of very negative results. So, an employees’ career and to an extent his/her survival hinges on these performance appraisals. Because of this cruciality, it should be conducted without any favoritism and bias, otherwise it could wreck the career of promising employees and even cause failure to the organization. So, performance appraisal should be carried out effectively before the introduction of the incentive program. Objectivity in deciding who receives rewards and recognition as part of incentive program The key factor that could bring down the excellence of managers and employees and thereby cause exodus from the organization is appointing, promoting and importantly rewarding individuals who do not deserve it. If any organization, overriding tried and trusted individuals; give important posts, promotions and recognitions along with other rewards and incentives to individuals who might be family members, friends, and persons with negative influence on the leader etc, it will create negative effects. For example, if least experienced or least qualified persons in different sections of the organization are promoted and rewarded as part of the incentive program, it will lead to a lot of problems within the workforce, disturbing impact on the high performing workers, leading to loss of motivation, excellence and importantly problems in retention. Equity theory of motivation states “that people have to believe that their pay is equitable with others. If they believe their compensation is not equitable, they become very de-motivated and their work performance suffers” (Stockley). So, if this practice of giving rewards as part of the incentive program to the non-performing employees and employees with negative influence is followed, it will create de-motivation and de-excellence among workers and will show the organization in poor light. Reward is another form of power which speaks of the ability of the manager to reward a certain employee for his deeds but can lead to serious problems for the employee if there is a conflict between the two and hence the power of reward can take a back seat in this whole equation. Example of optimal reward power is when the manager gives a bonus or a raise to an employee and the employee happily accepts it with an open mind, and thereby forming a psychological connection with the manager or leader. In many organizations, because of the ritual of awarding plum posts to the undeserving managers and employees, and shielding them when they committed mistakes, other members of the organization would band together in a kind of mutual protection ‘society’ that developed a culture of its own. They were more loyal to each other than to the organizations without any focus on the company’s goals. And in extreme cases and in cases of other options existing, the employees will leave the organization. So, implementing a logically and ethically correct incentive program is the key to retaining the employees and making them productive. Rewarding managers and employees purely on merit should be the main criteria of the Incentive program Optimum and unbiased incentive program or rewarding system should be part of any organization or performance management system because it can only motivate the employees by imbuing in their mind that their performance will surely be recognized and feted. It can only optimize the performance of the workers. “…build the psychological contract, in which employees feel valued by their employer, and the employer values (and is seen to value) employees’ contributions” (Cannell, 2009). But, if this rewarding system is biased, illogical, un-genuine as mentioned above, it could affect the performance. So, to keep the core group of good workers in a motivated state, the organization needs to award the right individuals with correct inputs from the HRD The excellence levels of the employees and thereby retention levels can be kept at optimal levels, only if the managers and other employees are rightly and ethically rewarded. That is, allocation of rewards, incentives, promotions and also recognition to the deserving and apt managers and employees is an important strategy to keep the motivation and excellence at higher plane. “Provide appropriate financial incentives and rewards, and non-financial praise for the employees’ achievement” (Armstrong, 2004). That is, rewarding the deserving and ‘success achieved’ employees especially high-performing managers and employees, will stick them to the organization, thereby increase their motivation, excellence and importantly retention level. In an organization, the workers do their duties for personal motivations like money (salary), flexibility, career development, culture or the working environment, but their motivation and excellence will get a great boost if they receive additional financial rewards, promotions and recognitions. This perspective is fully supported by Herzberg theory. That is, according to Herzberg's two-factor theory, good wages are good motivational factor, which can accentuate the excellence level. If a goal is set and the rewards part of the job is revealed before hand, then the workers will motivate themselves and will surely work in cohesion and importantly with excellence to achieve success. Also, rewards, promotions and recognitions to deserving workers will motivate others also, to reach that status. That is, the unrewarded employees will feel isolated or ignored, and so would put in more optimal work to reach the status or performance of the rewarded employees, thereby getting rewards for himself/herself. This way, with motivation flowing and retention optimized, organization can quickly get across their main goals by appropriately linking rewards and punishments to the activities of the employees. Incentive Program could remove stress and thereby improve retention levels Stressed mind in the sense, due to the poor match between work load and the capabilities, resources etc of the worker, the mind of the worker could be become disoriented leading to the damaging of worker's biological, psychological or social systems. So, the stress levels of the employees should be kept at bare minimum for the benefit of the employees. Also, with minimum stress levels, the motivation can be elevated to optimal levels, making employees work effectively bringing in profit for them as well as to the organization. On the other hand, according to the Perception and equity theories, individuals will get stressed out and could even leave the organization, if they perceive themselves as under rewarded or if don’t receive the benefits they are entitled to as part of the incentive program. Here, the role of the management, particularly the leader or the manager is crucial. The other theory which is related to low motivation and retention level and the correlated stress is the Vroom’s expectancy theory. This theory of Vroom is the “perceived value of a reward for accomplishing a goal. If the person perceives the reward to be high, then they will give more effort. If they perceive the reward to be low, then they will give forth minimal effort. If the reward seems undesirable, it could be an example of a de-motivator. So, to prevent employees from getting higher stress levels due to under rewarding, employers and its leaders should have an effective appraisal system and reward the employees, without any bias or mistakes or oversight. This way, the retention levels of the employees and organization can be maintained, without any problem. Along with incentive program or financial praise, non-financial praise is also crucial Even though, giving financial rewards will raise the motivational level, it is not the only motivating factor. Appreciation or praising can motivate the employees equal to the financial rewards and in a way retains the employees. “Praising staff had the same motivational kick as a 1 per cent pay rise. And while companies often offer bigger pay cheques as a reward for work well done, increasing employees' salaries isn't always the best way to engage staff, he says”. (Budd, 2008). An appreciatory word, allocation of rewards and also recognition to the deserving employees is an important leadership strategy to keep the motivation and excellence at higher plane, and thereby retain them. In any organization, the leader or manager needs to give appreciation for the staffs, if they complete the given work successfully. Appreciatory words will do a world of good for these staffs’ confidence and it will surely motivate them to ‘elevate’ their functioning further and sticking them to the organization. Case Study Nike Corporation is the world’s leading supplier and manufacturer of sports equipments, athletic shoes and apparels. It was formed in 1964, and by 1980, it already had more than 50% market share in the United States. The name Nike is derived from the Greek word of the same name meaning the Greek goddess of victory. Currently Nike has over five hundred factory or office locations in around 45 countries all over the world, the majority of these are in Asia. With such extensive locations, Nike, an American corporation has a sizeable percentage of employees from diverse groups, Nike targeted to become one of the best Employer of Choice at the turn of the 21st century. It wanted to be recognized as one of the finest places to work. To actualize that vision and mission, Nike implemented an incentive program in correlation with the mission. In any organizations including Nike, the workers do their duties for personal motivations like money (salary), but their motivation will get a great boost if they receive additional financial rewards, promotions and recognitions. When the reward component is analyzed from the perspective of organization’s mission, it does somewhat supports Nike’s mission. That is, Nike’s mission is “To bring inspiration and innovation to every athlete in the world” (Nike Business, n.d.). Even though, this mission is customer centric, to achieve that mission the employees have to work effectively. To make the employee at Nike work effectively, the incentive program plays an important role. The incentive program implemented inside Nike perfectly fits with its resources. That is why, Nike has introduced an incentive program called Performance Sharing Plan, which correlates with the company’s performance. “Performance Sharing Plan (PSP) - Nike has an annual bonus plan that rewards employees based on Nike's performance (to reward team success) and individual performance (to reward your contributions to that success).” (The New York Job Source, 2008). As the program rewards the workers who perform up to the expected level, it meets the expectations of the employees. Importantly, this incentive program is fully attracting and retaining the employees. That is, Nike by rewarding and giving incentives to the deserving and ‘success achieved’ employees through this program and other programs is making them stick to the organization. This system is very flexible because it changes according to the performance of Nike. That is, if the employees perform optimally and raise organizational productivity and profits, they will be rewarded optimally. As this program is applicable to all types of employees, it cannot be tailor made for specific workers. On the whole, this incentive program functions as one of the main motivating factors for the employees, making them stick to the organization and thereby helped Nike reach the status of the world’s number one maker of athletic shoes, equipment and apparel. When organizations fail to reward the employees appropriately, it could wean way the workers from the group decision making process and the resultant work teams. That is, some times or even frequently, the management overriding tried and trusted individuals could give important posts and responsibilities to individuals with negative attributes. If this practice is followed in the organisation, it will create disenchantment among the workers and will destroy team work. This ritual of awarding plum posts, rewards, incentives, etc, to the inappropriate members by the leader or the management team is not a norm in Nike. Nike rewards the employees in an unbiased manner. As mentioned above even this main incentive program of Performance Sharing Plan is applicable to all performing employees. Because of this strategy, workers in Nike are not banding together in a kind of mutual protection society with a culture of its own, but unite as work teams and are working in unison for the organizations. Unison of workers into teams with an urge to usher an organization into a successful endeavor will actualize, if the organization formulate and implement optimal programs including incentive programs. And as Nike is able to do it, it is having a ubiquitous presence all over the world. Conclusion The organized or planned human activity under the structure of organization has to be carried out with precision for it to succeed and thereby retain its employees. But, precision in organizing or planning cannot be done without the initiatives and the fullest co-operation of the managers and the employees, without giving the chance for exodus. If a goal is set and the motivation level is heightened with the help of an effective incentive program reward, promotion and recognition system, then the managers and the employees can work in cohesion to achieve success. If the incentive program and the recognition system is optimized by incorporating all the above mentioned aspects as well as aspects from the real life case study, the excellence of the manager and the employees will also be optimized. When the employees’ excellence is optimized, the organization will show great success and profits, a portion of which will be rewarded as part of the incentive program, making the employees mentally happy and motivated, thereby continuing and sticking to the organization. References Armstrong, M (2004). How to Be an Even Better Manager: A Complete A-Z of Proven Techniques, 6th Ed. London: Kogan Page Bacal, R. (2004). Management File - What IS The Point Of Performance Appraisal. Retrieved November 22, 2009 from http://work911.com/performance/particles/perfpoint.htm Budd, H. (2008). Pat on Back beats Pay Rise. Retrieved November 22, 2009 from http://www.news.com.au/business/story/0,,23433504-5012428,00.html Cannell, M. (2009, January). Employee communication. Retrieved November 22, 2009 from http://www.cipd.co.uk/subjects/empreltns/comconslt/empcomm.htm?Is SrchRes=1 Marzano, R.J et. al. Classroom instruction that works. ASCD Nike Business. (n.d.). Shop & Customer Service: The Nike Mission. Retrieved November 22, 2009 from http://www.nikebiz.com/customer_service/ Stockley, D. Motivation and financial and non-financial rewards. Retrieved November 21, 2009 from http://derekstockley.com.au/newsletters-05/025-motivation-reward.html The New York Job Source. (2008, June 26). Nike. Retrieved November 21, 2009 from http://nyjobsource.com/nike.html Read More