Performance and Reward Strategies - Essay Example

Vita group: Performance and reward strategies Student’s Name: Course Code: Lecture’s Name: Date of Submission: Introduction A look at Vita group indicates that the group has reward systems aimed at enhancing the performance of the members of staff towards greater heights in terms of service delivery. With this it can be observed that Vita group runs a number of brands aimed at the service industry in the form of information technology, where the reward systems focus on sales and customer satisfaction. The means through which the organization reaches out to its clients requires that each employee meets the different needs of each client through quality service provision. The goals of the organization, as stated include the need to have products focussed on solutions to customer problems both existing and those to come up. Based on the motto, it is evident that there is an alignment between worker integration and the services provided, where employees have to stick to company objectives prior to engaging in personal interests (Mujtaba & Shuaib, 2010). It is in this case that performers and underperformers are identified for reward schemes, where top performers are granted their deserved treats. Based on organizational policies, alignment in reward schemes appears in the form of achievement of organizational goals, the motto of the company seeks to motivate the workers to provide their best services to customers through disambiguation of product use, as well as provide a positive customer experience to existing clients. All this all while appealing to potential customers in an effort to promote returns for the organization altogether rather than working in an isolated group of existing clients in place. Discussions Alignment Ajila and Abiola (2004) state that integration of performance and reward schemes with organizational goals are crucial to creating motivational goals to employees. With this, they argue that this integration with intrinsic reward schemes offers extreme enjoyment of one’s job, where one experiences job satisfaction and gains positive organizational culture. Leonard (2002) states that alignment of goals with performance and reward schemes exudes confidence in employing so that they are able to provide higher returns due to internalization of organizational goals and creation of an identity towards them. This is because aligning the two aspects of performance blends personal goals with those of an organization based on internal motivational theories so that every activity conducted by the employee relates subliminally to the goals of the organization rather than having independent goals between personal and organizational entities. Ajila and Abiola (2004) further mention that extrinsic reward systems in alignment could lead to higher returns in an organization, where these may increase returns performance and motivation to provide better quality services and quantities in products. The above is based on Vroom (1964), where this integration only serves as a motivational factor, but one that works dependent on increasing returns in rewards rather than fixed rewards, as they lead to stagnation. In addition, alignment is crucial in that it creates a stable relationship between employees and organizational goals rather than connecting through job descriptions (Pfeffer & stutton, 2006). In this case, it woos employees to provide better levels of commitment to their jobs and come up with better organizational citizenship behaviour. On the other hand, lack of alignment results in a breakdown of communication and failure to achieve goals in the organization (Armstrong, 2009). Through this, misalignment of the two aspects creates an impression to employees that they are entitled to the rewards without having to work for them, resulting in reduced performance and poor commitment to the organization as a whole. Zakaria et al (2011) also suggests that failure to align rewards schemes and organizational values contribute to poor support structures for employees, which are linked to motivation and personal goals. This dispels the retention of performing employees in the organization since the reward system becomes irregular and unpredictable, making the workplace confusing and demotivating (Pfeffer & stutton, 2006). Similarly, misalignment contributes to poor leadership in that team leaders can no longer control or direct their subordinates to follow their lead in carrying out organizational activities. Key issues Vita group appears to suffer for certain issues with regard to performance management strategy and practices. The above is due three key issues, pointing to direction, alignment and commitment, where each serves as an individual component to meeting the needs of the organization in service and product delivery (Pfeffer & stutton, 2006). A look at direction indicates that the organization faces issues in having employees who can follow its business to completion and success emanating from the values to deliver quality customer satisfaction. In spite of having the direction of the organization defined, there is little following by underperformers in that there are no agreement until these individuals undergo consoling to improve their service delivery to customers. Armstrong et al (2009) state that this lack of harmony in direction between top performers and underperformers undermines achievement of organizational goals leading to failed companies. Similarly, the issue of direction could lead to lack of compliance with organizational authority, or leadership due to opposing perspectives and opinions on the relevance of task performance as evidenced by the difficulty to state underperformers. Alignment is also a challenge for the organization in that it is difficult to tell apart between successful organizational culture and reward based motivation. According to Aguinis (2007) alignment of organizational goals with those of individual employees serves a key means of achieving organizational objectives, but based on the concept of over and underperformers, as well as reward schemes, the opposite takes place. If the motivation of employees cannot be discerned, the motto of the organization “Love what you do” does not applying this case since it serves a forced means of executing tasks. Mehmood (2013) suggests that discerning the motivation of employees in accordance to organizational objectives helps in assisting employees attain the best results with regard to their skills. Aligning motivation and performance based on motivation is not achieved in the organizations since there remain underachievers who still need counselling. Similarly, according to the organization’s motto, there is a little internalization of the objectives of the organization because if the goals were integrated within personal goals, the organization would only have overachievers and average achiever, without the negative extreme. In addition, alignment remains an issue due to the need for negotiation between employees and the employer to ensure that each employee meets his or her quota of achievement in order to receive their rewards. Aktar (2012) state employees who have well aligned goals with those of their organization do not need to negotiate as there is invisible job satisfaction and efficiency in meeting their requirements. This is due to the concept of mutual gain, but with focus on the greater goal, which is that of the organization and is collective. Commitment is also another issue that the organization faces since the provision of the right conditions of work serve as a means of evaluating the likelihood of achieving organizational objectives. Njanja et al (2013) mentions that besides provision of reward schemes, provision of appropriate working environments serves as commitment factor, where engaging workers directly rather than just stating the expected goals, personal communication should be met (Mehmood, 2013). The company offers counselling, but this does not address the issue of having appropriate relations for commitment to goals and the workplace as a whole. Similarly, this could serve as an issue based on intimidation by the overachievers, where their performance is higher than expected standards for the whole organization and their reward schemes remain high due to the same (Njanja et al 2013). As a result, there is reduced motivation due to poor interpersonal communication, which form a fundamental ground for the workplace environment and achievement of both personal and organizational goals. Integration of performance and reward schemes According to available evidence, there is full integration of performance and reward management strategies in that the two are interdependent. In the Vita group, reward schemes are used to ensure that performance strategies in place face full implementation to increase performance and achievement of organizational goals (Mujtaba and Shuaib, 2010). As such, it is evident that all reward schemes are dependent on achievement of organizational goals, where non-performing teams or employees do not receive any rewards, but rather get counsel on how to enhance their performance. To elicit commitment and enhance performance, reward schemes in the form of training are provided by the organization and these sow the level of integration, but there also exists a hint of lack of integration (Mujtaba and Shuaib, 2010). This is in that training does not necessarily do the best for over performers, but rather for underperformers, where training should assist them meet their quotas. The reward schemes are also diversely and well integrated within the performance strategies in that there are plans to cultivate motivation and organizational citizenship behaviour through offering rewards for long-term service to the organization. These are in the form of badges to appreciate and motivate the workers to ensure that they keep up their service delivery (Helm et al, 2007). However, there are disparities in the integration due to the provision of incentives without focus on individual worker characteristics, where some employees may not find the incentives appealing to their personal needs. However, they only conform due to organizational objectives, meaning that the incentives remain a failure to them. Relevance Mujtaba and Shuaib (2010) states that integration remains integral in any reward and performance strategy. This is because integration ensures achievement of organizational goals and inspires confidence in employees owing to the ability to appeal to their personal ideals and values and associating them to those of the organization. As such, integration serves as a motivational factor, where there is general pay for work done and any work done beyond the expected threshold is rewarded accordingly, which is part of merit pay, rather than pay for performance (Mehmood, 2013). Similarly, integration allows the employer and employee to exploit their abilities in favour of the organization by providing better services to the clients involved. This is because, integration allows the employees to come up with feedback systems that are accessible to employers and employees, as well as clients (Helm et al, 2007). In consideration of that, integration becomes a strategic performance ploy through encouraging initiatives by the employees to achieve goals that are set based on their abilities since integrations sets goals in consideration of employee abilities. On the other hand, lack of integration result of forced work activities, where employees are not willing to participate on organizational tasks (Mujtaba & Shuaib, 2010). Mujtaba (2008) states that lack of integrations results in opposition to work related tasks since rewards and performance are set out as separate entities, and this could lead to collective rewarding rather than individual; rewards. With collective rewards, there is reduced productivity, since this is not part of an integrated system, leading to underperformance by certain employees who expect to reap rewards from the over performers. As a result, there is reduced performance and dysfunctional rewards systems incapable of performance appraisals (Mehmood, 2013). Rewards and managers Performance and reward management strategies would enable managers to effectively manage and motivate their employees who are high performers in that high performers are easily motivated and a mere increase in the reward would significantly increase their returns (Dewhurst et al. 2010). As such, these strategies would significantly boost returns due to appeal to personal characteristics as exhibited by leadership styles, especially transformational leadership (Wang & Nantsupawat, 2012). As such, appealing to their internal mechanisms and values, they can be in apposition to increase their output and even relate to the relevance of their jobs. For managers, the role of the reward is a form of payback to appreciate the high performers, thus does not count much to them, but a minimal increase could boost performance. In the case of moderate performers, the best performance and reward management strategies that would work involve removal of all financial reward schemes and emphasis on services (Perry et al, 2006). In so doing exclusion from all fun activities engaged in by high performers, pressure is mounted in average performers to bridge the gap between them, and this fosters much needed competition. Competition in this case needs to be healthy, where employees work to win the rewards instead of having the same group of employees (high performers) taking the prize always (Mujtaba & Shuaib, 2010). It should however, be noted that this could lead to cartel like behaviour between employees by having one group win the rewards at one time, while the next time another group wins. As such, the strategy needs to ensure that even those who improve there are rewarded rather than having high performers reap the benefits. Underperformers pose the largest challenge to managers in motivation based on performance and reward management strategies. Ebert (2010) suggests that manager should employ pay for performance, where according to Maslow’s hierarchy of needs; the urge to work harder for their wages is increased. With this, the threat that pay will be eliminated, which is also tantamount to losing one’s job, motivates the underperformers to do their best to pull their weight in the organization (Mujtaba & Shuaib, 2010). This is in regard to increasing output significantly so that they join the leagues competing for rewards rather than being just employees working for their wages. Performance appraisal, therefore, becomes a means of measuring the suitability of one earning their wages before introduction of incentives. Recommendations San et al (2012) suggests that effective structuring of performance and reward management strategies should be done before any positive observations are made. This is because there are both positive and negative consequences emanating from these schemes, but structuring them around the abilities of employees and the goals of the organization works best for both. This means that all organizations need to coordinate and integrate their organizational goals with those of the organization under scrutiny, so that reward schemes and appraisals can be realistic, with realistic expectations. Similarly, Mujtaba and shuaib (2010) explain that aligning organizational performance appraisals with reward schemes also reap positive effects on the achievement of organizational goals. In this case, elimination of all monetary or financial rewards should be made and rewards be evaluated in accordance to individual abilities, where each employee has a goal to achieve and is rewarded upon achievement. With this, there are higher returns for the organization collectively and cutting back on expenses made for rewards that do not increase motivation. Aktar et al (2012)also argue that the presence of reward schemes need to be based on commitment and loyalty so that reward schemes act as incentives for retention of employees and gain their loyalty to organizational objectives . As such, the key issue in this is to ensure that all employees feel appreciated, integrate their personal goals into those of the organization, and work towards a positive organizational behaviour (Mujtaba & Shuaib, 2010). This ensures that even without the rewards and performance management strategies, employees are willing to go the extra mile for the good of their employer, in which case, employers should show their loyalty. It is in this case that the employees come up and offer their skills without expecting any rewards, but employers offer the rewards anyway due to the commitment portrayed. As a result, the provision of the best environment for work in interpersonal relationships and communication should elicit the above between employees and employers, as it serves as the best incentive to follow up with rewards. Conclusion Altogether, Vita group stands out as a classic company with typical applications of performance and reward management strategies that lead to underperformance and over performance. As such, there are ways through which the company can align itself with the needs of employees in an effort to achieve personal and organizational goals. With these integration and capitalization on the employees’ abilities can best achieve these objectives by making the reward schemes successful, rather than promoting complacency in the company (Mujtaba & Shuaib, 2010). This serves to increase output, where application of incentives based n incentives can eliminate the need for counselling and instil positive organizational culture for all employees regardless of their abilities. Similarly, streamlining of organizational objectives with personal goals and based on personal abilities. Doing so will serve to assist in ensuring that all reward systems are offered on merit and based on performance appraisals, thus increase employee and company output. References Aguinis, H 2007, Performance management, Upper Saddle River, N.J.: Pearson Prentice Hall. Aktar, S 2012, The Impact of Rewards on Employee Performance in Commercial Banks of Bangladesh: An Empirical Study, IOSR Journal of Business and Management, 6(2), p. 9-15. Ajila, C & Abiola, A 2004, Influence of Rewards on Workers Performance in an Organization, J. Soc. Sci, 8(1), pp. 7-12. 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