Reward System in the Swedish Real Estate Sector - Case Study Example

Survey on the reward system in the Swedish real estate sector Student Name: Course: Professor: Date: Survey on the reward system in the Swedish real estate sector Introduction It has been proved that for ant firm to come across good human capital, and then the road would be expensive and hard to come by. This means that human capital still stands to be the greatest determinant of the success of any firm. In this report, a comprehensive survey has been carried out on the Swedish real estate firm. Its purpose is to find out if there are financial or non-financial management rewards in this firm (Burke et al. 2007). Different managerial rewards greatly depend on Social exchange theory as well as the dependency theory as applied in the Swedish firm. At different levels of development for the firm, there are various benefits as well as financial rewards as prescribed by the nature of different employee’s nature. Several programs have been introduced to successfully reciprocate the tireless efforts of the Swedish firm employees. This paper therefore, will be able to give us a clear picture of how the Swedish real estate sector operates. The review will touch on the framework, system requirements, the current practices in the firm as well as the rehearsal and roll-out. This survey adopts a clear viewpoint on the employer-employee relationship as applied in the economic and social exchanges in the firm. Finally according to this survey, it is affirmed that the some parts of the reward systems in the firm, are driven by the engagement of the employees and how they could be socially exchanged. This study is widespread and does not only focus on the executives the firm, but also on the role of employees to the well being of the reward management of the Swedish real estate sector firm (De Greef et al.2004). Key concepts Several questions have been raised concerning the reward management on real estate firms and in particular, the Swedish firm. These reward systems majorly focused only on the executives and the managers of the real estate firm. In the early 90’s, the Swedish real estate firm had experienced some real financial crisis (Storey, J. 2002). The blame was entirely on the nature of reward system that was in operation. According to the survey carried out, it is important to note that for total reward strategies in the firm, then the Social exchange theory (SET) an the agency theory should be operational. In some instances, variations may occur on different reward items which are further explained by the resource dependency theory. In the early years of 90’s, there were some inevitable challenges from the institutional, economic, political and ideological pressures. This change was aimed at adopting new and better managerial instruments in the firms. These instruments have their greatest emphasis on the manager’s performance, reward and appraisal systems (Ghosh&Sirmans.2005). From the research carried out by great employers, there is emphasis that a realistic view of what can be achieved in a limited time frame. It is also important to focus on evaluation in a key area rather than make a long list that will never be. The managers should also focus on improving the existing mechanisms of human capital reports and the employees’ attitude survey. There has been a worldwide administrative reform that is in line with the principle of the new public management. The reward management in firms and public sectors serves as the greatest communicator of organizational goals and values of a firm. This solution is applicable in the private and the public sectors. The employees always feel appreciated and the gain an attitude to improve their attitude. The customer is also of great help when implementing the necessary attitude. Customer care when handling and offering the services is paramount. Performance based rewards schemes (PBRS), focuses on the schemes dealing with the pay, assessment, motivation and organizational performance. This trend is not supposed to a onetime thing but a long continuous trend as well. With clear target goals, a well established performance target and role assignment, then the Swedish firm would encounter great managerial rewards (Burke et al. 2007). With the main aim of reinforcing the processes of change in public and private policies, then the pay systems should also be considered. For instance, the construction industry in Britain, has been trying to adapt and reinforce managerial change in the industry. This industry has a great number of employees but the workload has been fluctuating at a very high rate. This is not really expected if there were more variable forms of rewarding the workers and a very high appeal to the managers (De Greef et al 2004). The American term ‘new pay’, is a vital reward management in British to improve the progress and service –related benefits. The new pay borrows a number of themes with the objective of increasing the performance design of the firm. For effective reward management, the approaches to performance measurement and management should be put in place. These approaches include competencies, work behaviors’ and results. Competency assessment will involve analyzing each employee’s ability, skills and knowledge. In a firm, this would help in identifying individuals with good performance skills in particular areas. Eventually this would increase productivity as well as general performance of the managerial sector (Storey, J. 2002). Great results would be marked by an increase in customer number, sale of products, and attainment of higher levels of services as well as creating an environmental impact that is recognized. It is necessary to have performance appraisal and reward systems in the Swedish real estate sector. This is based on the assumption that employees need to be rewarded and motivated in order to establish a clear link. The efforts and hard work of individual employees should be rewarded through formal and individualized set targets. Great managers sounded a warning that it would be demoralizing to the employees if too many limitations to performance appraisal and reward are put. These kinds of critics would give rise to some critical organizational issues, which would develop to interpersonal relationships between employees (Ghosh&Sirmans.2005). Public managers are considered to be the pivotal figures in implementing change in the firm. For the managers to be able to execute the judgment on appraisal, they are required to have technical knowledge and competence in the specific sectors. The introduction of performance and skill based pay systems, is also a major factor in implementing managerial reward in the Swedish real estate sector. Payment is by far the most important element in any employment relationship (Rafaeli et al 2008). The payment transactions are equally important to the gorvement, employer and the employees. The employer values the pay because it significantly represents the costs he undergoes. The salary he pays depends on his employees’ competitiveness and performance. His ability to recruitment and retain work force is based on, how much he can offer (Burke et al. 2007). To the employee it is increasingly important because, it serves as a measure of his services and performance and the pay helps him to raise his living standards. The government on the other hand, the wage bill would affect the aspect of macro-economic stability. This defines the purchasing power in the market, inflation of goods and services, employment rate in general. Relevant theories and research There exists a major relationship between the employer and the employee which is comprised of both economic and social exchanges. When an employee is hired by the employer, a contractual relationship is created. The employer tables what he has to offer in terms of the salary wages, benefits in exchange for instance house and medical allowances (Pandey & Garnett.2006). This is in exchange to the employee’s efforts and skills. Apart from the obvious economic exchange, the two parties may end getting other benefits that may not have been entirely listed in the contract. This develops from repeated interactions as long as all parties are interdependent. This kind of relationship can be explained by the agency theory, because one party acts as the principal enters a contract with another party (agent), to be able to perform tasks that involve specialized skills (De Greef et al. 2004). The principal invests in various processes that will prevent the agent from becoming an opportunist. The performance of the employer, determines the reward they get from the principal employer. The interrelationship between the employer and the employee in the Swedish real estate is a package of either non-financial or financial rewards. The only difference is that there could be the items being rewarded between different firms. The second theory is the Resource dependency theory. According to Storey, J. (2002), this theory elaborates that when a firm like the Swedish real estate becomes prosperous; it is directly proportional to particular activities in the same firm. The employers in these high rankings are able to influence the reward merits so that they can fit their own preferences. These individuals are in control of some of the vital resources in the company. The employees, who are allocated some big managerial positions, are able to manipulate the reward policies so as to suit their preferences and eventually increase their potential earnings. The resource dependency theory demoralizes the less influential employees and creates different job groups all together. The employment relationship in the Swedish real estate sector has both economic and social exchanges (Marroquin.2005). This creates a complimentary blend of the financial and non-financial rewards within and across other firms. Several models are available and they all give one summary; good leadership and management, will always create a fair reward management for the firms and companies. Examples of evidence-based reward management. (EBRM) All over the worlds, most firms and organizations are still struggling with issues regarding development, implementation, and evaluation and reward policies. Each organization and firm adopts its own theory and approach to suit the circumstances and needs they face. For instance, the county council of Kent attributed to a very strong and successful united politics (Ghosh&Sirmans.2005). They aimed at concentrating on cost so as to reduce the local authority funding. Secondly, the McDonalds Company has succeeded in building a very strong culture of measurement among its employers. They were able to prove that reward to the employees can enhance their engagement in the business. Conclusion In summary there should be a continuous evaluation on the effectiveness of reward management and strategies in different organizations. This in turn will introduce change to those that are not working at optimal levels. For the success of the Swedish real estate, the firm must constantly and regularly introduce exiting and new awards to its employees (Mahoney.2002). The culture of this estate should encourage positive and helpful competition among its workers. For this to happen, there must be trust and a sound pervasive sense between the employees and the employers of different organizations. With this kind of reward management system in place, then the Swedish real estate sector will tickle all the way to the bank. Work cited Burke, L.A. and Hutchins, H.M. (2007), “Training transfer: an integrative literature review”, Human Resource Development Review, Vol. 6 No. 3, pp. 263-96. De Greef, M. and Van den Broek, K. (2004), “Quality of the working environment and productivity – research findings and case studies”, working paper, European Agency for Safety and Health at Work. Ghosh, C. &Sirmans, C.F. (2005), “On REIT CEO compensation: does board structure matter?” Journal of Real Estate Finance and Economics, Vol. 30 No. 4, pp. 397-428. Mahoney, T.A. (2002), "Multiple pay contingencies: strategic design of compensation", in Salaman, G., Human Resource Strategies, Sage, Open University, London, pp. 337-46. Marroquin, A. (2005), “Where did the miracle come from? Exploring Botswana’s economic success”, George Mason University mercatus Centre. Pandey, S.K. and Garnett, J.L. (2006), “Exploring public sector communication performance: Testing a model and drawing implications”, Public Administration Review, Vol. 66 No. 1, pp. 37-51 Storey, J. (2002), ‘developments in the Management of Human Resources’. Blackwell. Oxford Rafaeli, A., Ziklik, L.and Doucet, L. (2008), “The impact of customer centered employees’ Customer orientation behaviors on service quality”, Journal of Services Research, Vol. 10 No. 3, pp. 239-55. Read More