Coles Company - Employee Motivation and Compensation - Case Study Example

Employee Motivation and Compensation: A case study of the Coles Company Name Institution Course Date Title Table of Contents Abstract 2 Employee Motivation and Compensation: A case study of Coles Company 3 Introduction 3 The Coles Company 4 Rewards and Benefits 4 Job Design 6 Employee Participation 7 Quality-of-Work-life programs 9 Employee Compensation 10 Conclusion and Recommendations 10 Bibliography 12 Abstract This report is about employee motivation and compensation. We have used the Cole Company to illustrate how companies use various techniques in order to motivate their employees. This report highlights the various types of motivation and compensation that the Cole Company uses on its employees. The report introduces the subject and gives a discussion of how the Cole Company goes about the business of motivating and compensating its employees. Possible recommendations on how best the concepts of motivation and compensation can be utilised are highlighted. Employee Motivation and Compensation: A case study of Coles Company Introduction Employee motivation refers to those factors that induce an employee to carry out his or her work related tasks and goals. Normally there are two types of motivation; intrinsic as well as extrinsic motivation. Extrinsic motivation requires the use of external factors in motivating the employee to work. They could be rewards or punishments. Rewards motivate the employee to work so as to revive them while punishments motivate employees to work so as to avoid them. For these two to work well in motivating employees they must be certain. Punishment could be something like dismissal or demotion while rewards include giving gifts or paid vacations to those who hit particular targets. Intrinsic motivation comes from within the employee himself. Usually employees are intrinsically motivated to work when the work itself is motivating. Such employees find their jobs enjoyable and satisfying. In comparison to the extrinsic motivation, intrinsic motivation is far more effective. The only tricky bit about it is that it’s very hard to facilitate intrinsic motivation. The only way to facilitate this kind of motivation is making the job and its environment conducive for the employee. This could be possible by allowing your employees some autonomy. The Coles Company Coles is an Australian supermarket chain that was founded in 1914. It is owned by Westfarmers and operates 776 supermarkets throughout the country. The company has over 100, 000 employees in over 2200 locations within Australia. The Coles Company has been in existence for over 100 years. Keeping such progress and a huge pool of employees requires strategy. The company has been able to perform well in the market because of the motivation techniques they use. According to Pierce et al (2003) there are various techniques that companies can use in order to motivate their employees. They include creating a challenging as well as satisfying job design, rewards, ensuring employee participation and creating a work life balance. The Coles Company has been able to innovatively use the above techniques to motivate its employees hence its steady progress. Rewards and Benefits According to Wiersma (1992) when an employer decides to use rewards to motivate his employees then it can either be intrinsic or extrinsic motivation. Examples of intrinsic rewards are the inner fulfilments employees get out of an achievement. Extrinsic rewards on the other hand include things like trophies bonuses, money, compliments among other things. The Coles Company is known for using rewards and benefits in order to motivate its employees for a long time. For instance the employees are entitled to great discounts in a range of west farmers stores and access to exclusive benefits. What happens is the employees are provided with mycoles card which they then use to access theses discounts in any store across the country. Additionally there is mycoles website that all employees can access anytime so as to know where they can shop on discounts. The company normally offers great deals in health, finance, leisure and telecommunications. The benefits are usually reviewed from time to time so that employees have a variety of taste to choose from whether it’s travelling, getting movie tickets or buying electronics. There is considerable literature on how motivation is influenced by reward resulting in very interesting results. For instance according to Pierce et al (2003) found out using rewards to motivate employees that meet a particular target led to an increase in motivation. They further reiterated that employees that are not rewarded at all or those that are rewarded for maintaining a particular constant measure of performance were less motivated intrinsically. Some of the special benefits that are given to male employees of the Cole Company include the chance to join the company’s bonus scheme after three months on probation. Again once an employee successfully finishes twelve months in the company then they can join the staff superannuation scheme that is based on an Endowment Assurance Policy. There are those benefits reserved for executive staff and are fully paid for by the company. Additionally when an employee works for ten years they are usually entitled to three weeks payable leave annually. The Cole Company also provides Group Assurance as a motivation to its employees. The company also realises the importance of service recognition and that’s why, employees are appreciated in various ways. For instance, thank you cards are given to employees who bring a difference to their department store, customers and the community. These cards give an opportunity to employees to recognise the efforts of their colleagues on a job well done. Moreover experience is also recognised in the sense that those employees who hit either five or ten years are rewarder a special name and badge and a special celebration. Last but not least the company has a reward called caring passionately which is given to employees who go out their way in order to help colleagues’ customers and the community. Those who get these rewards are normally nominated by their colleagues. This reward is meant to help employees appreciate each other efforts. Even customers are given a chance to nominate whom they think deserves this award via the Tell Coles survey. The winners are then given a special badge that than can where with pride. Job Design The way a job is design can influence an employee’s motivation (Earn, 1982). Job design has to do with the creation of challenging as well as satisfying for your employees. This then makes the job more effective and efficient to be done. Earn () proposes various ways in which employers can create a satisfactory job design. To begin with, they can do what is called job simplification such that the jobs are specialised and standardised. Secondly, the employer can enlarge the job in such a way that the employee has a variety of tasks to handle to avoid routine which brings boredom. Thirdly, employers can use what is called job rotation. This is whereby employees are moved periodically to handle different tasks. Lastly, the jobs could be enriched so as to make them fulfilling to the employee. The Cole Company has a good record in making the working environment and the tasks enjoyable. For instance, the company has instituted what it terms as a world class graduate program, specialised academics and experiences plus structured in-store training. The career path at Coles Company is so enriching and with over 2200 locations over Australia it makes it an enriching place to work. Employees are hired through a competitive interview process (Annual Report, 2015). Once you land a job in the company, various training is offered in order to introduce you to your tasks. These trainings are offered occasionally by experts within and without the company. According to the Coles employee manual (2014) immediately a store man is hired, ‘the new man is placed in a selected store where he receives initial training. Necessary assistance is given to him so that he acquires insight into the company’s activities. The Coles Company is alert and far sighted in its policies. For instance from time to time employees are sent to study trends in America, England, and Europe. The company regards every new employee as a possible manager in future and so a great deal of money and time is spent in training them in the best way possible. Normally all management trainees who have some form of responsibilities for other staff members get bonuses biannually depending of the level of responsibilities. The company also recognises the efforts of the top managers by allocating them a share in the profits of the company. Other special benefits available to employees at Coles Company include assistance with housing finance. Just as Campion and Thayer (1985) argue, jobs that have more motivational features require less efforts in implementing, they ensure the betterment of the employee and less medical expenses. Moreover redesigning a job improves the quality of products and increases the amount of work done. That’s why the Coles Company has been launching various products into the market ranging from electronics, foodstuffs, liquor and gas among others. Employee Participation One of the best techniques that an employer can use to motivate their employees is to ensure that they are involved in making decisions that will grow a business. Participation requires that employees are given a chance to give solution to problems that the company may be facing. They should also be allowed to give suggestions on how a company’s production can be improved. Employee participation has been reported to lead to a better relationship between employers and their employees, increase commitment on the part of employees, open channels for employee communication and expression and self-development (Marks et al, 1986). The Coles Company has a policy that allows effective communication amongst employees themselves as well as between employees and the management. The core values of the company stresses so much on respect between employees. Participation requires that employees feel respected and their opinions valued even if they won’t be adopted. The Coles Company is very keen in developing its own staff. That’s why they offer opportunities to the employees to grow along with the company. So as to remain competitive in the market, they know the value of feedback from their employees. To this end, frequent meetings are held between departmental heads and employees to get their views about how best to run the company. There is a feedback mechanism where employees can comment on what they think it’s being done right or wrongly. Frequent brainstorming sessions are held from time to time. Various techniques have been suggested by various scholars on how to ensure employee participation. For instance according to (Levin, 1990), a company could use what is called open book management technique. This simply refers to whereby the company shares critical financial information with employees. This in a way builds the trust with your employees as well as building some level of trust in them. By doing so you let the employees have knowledge on how the company is faring financially. However it’s important to understand that for employees to effectively participate in the organisations there are various factors to be considered. To begin with a profit sharing scheme should be put in place. The Coles Company recognises the effort of the executive management and that why they allocate them a share in the company’s profits annually. Secondly it is important to ensure that your employees have job security. At Coles Company, employees are hired and trained to be future managers. The fact that there are certain rewards for people who work for say five or ten years makes employees want to stay and fully participate in the affairs of the company. Thirdly ensure that there is cohesion among the employees. Let your employees learn the important of team work. This perhaps has been the greatest secret of the Coles Company which encourages its employees to work in solidarity. Once an employee is hired, they are given the employee charter to sign. This charter states the code of conduct among the employees. It promotes effective communication and respect for each other. The charter allows employees to be fair in their criticism and praise a job well done. They are made to realise that courtesy is each employee’s right. Lastly employees’ rights should be protected. This will make confident at the workplace. The Coles Company has always ensured that its employees’ rights are well protected especially at work. There are various policies that guide them in this. There is also a code of conduct that prohibits abuse, discrimination among other things. Quality-of-Work-life programs Employees are people with personal lives as well. So as you engage them there is need to ensure a balance between work and personal life. Employees who feel overworked are less motivated. Some of the quality of work life programs includes workplace wellness, family support and flexitime. Flexitime implies that employees are allowed to come to work at any given time as long as their work is done on time. Or in some cases in may allow employees to work from home. A wellness program could entail having an exercise facility, offering counselling or weight loss programs etc (Soo, 2010). One way in which the Coles Company does the work-life balance program is through its health and safety programs. The company works around the clock to ensure that the working environment is safe and conducive. The company has adopted a Wellbeing program that gives guidance on matters health and fitness to the employees and their family members. This wellness scheme is run in collaboration with Fitbit wellness enterprise division. There was a trial program with employees working at the Express petrol stations which were rated as a success. This program was adopted in order to help employees improve their health, boost productivity and cut down on injuries. Employee Compensation Employee compensation refers to the benefits that an employee expects to receive after getting the work done. It could be in form of cash or otherwise such as a vacation, bonus etc. there are various ways of compensating employees (Harkman, 1980). For instance cash as either wages or salaries, paid leave, life insurance, retirement plans, paid health insurance and disability insurance. The Coles Company has a compensation structure for its employees. Employees are compensated depending on their level of skills, education and placement in the company. The company has both casual and fulltime employees and both cases they are compensated accordingly. The Cole Company compensates its employees in very many ways. To begin with, wages and salaries are the most common. Most of the employees are either paid an hourly rate or annual salary. Second to cash compensation is vacations and rewards. As aforementioned the Cole Company has schemes for compensating employees. According to (Erven, 2012) employee compensation is increasingly becoming expensive for many companies. Usually compensation is either given as a base pay or a variable pay (Dunham, 1977). Base pay refers to the compensation based on the role played in a company and the market price for it. Variable pay on the other hand is based on is based on an employee’s performance. Conclusion and Recommendations Employee motivation and adequate compensation are essential if an organisation has to achieve its objectives. Cole Company provides a good case study about an organisation that invests in a company. Once you have happy employees you will get good results in the market. There are various ways in which companies can motivate their employees. It is ether by rewarding them or punishment. Studies show that employees tend to get motivated better when they are rewarded other than punished. In this report, there are two types of motivation including intrinsic and extrinsic. Intrinsic motivation comes from within. While it’s the best kind of motivation, the only challenge is that it’s hard to facilitate. Extrinsic motivation is enabled by external factors. The Cole Company has been instrumental in providing a variety of benefits as a way of boosting the morale of its employees. The company has come up with various rewards that promote teamwork and cohesiveness at the work place. Employees have a website where they can get to know which benefits are at their disposal irrespective of where they are. The company has been in existence for over 100 years for no and it’s still growing because of motivating and compensating employees well. Motivation goes hand in hand with a good compensation package. In fact compensation that matches with an employee’s skills and position in the organisation is a motivating factor. Motivating employees is a costly affair especially if you have a huge human resource like the Coles company that has over 100, 000 employees. But when an employer looks at the motivation expense as investments then definitely they will see the results in due course. The Cole Company has done well as far as motivation and compensation of employees is concerned. However a lot needs to be done especially to the casual labourers who do not have long term commitment with the organisation. More sustainable schemes of benefits should be instituted rather than the short term badges and discounts. Forming a scheme where employees can poll their resources and then make real investments out of it can be a way out. In conclusion having employees that have no motivation or are less motivate is the worst thing that could happen to an organisation. It should be the goal of every organisation to ensure that their employees are well motivated. Bibliography Erven, B. 2012, Designing Jobs that Motivate and Challenge Employees, Contemporary management Vol3 (2): 25-33. Campion, M. & Thayer, P. 1985, Development and Field Evaluation of an Interdisciplinary Measure of Job Design, Journal of Applied Psychology pp 29-43. Hackman, J.1980, Word Redesign and Motivation, Professional Psychology pp 445-455 Dunham, R. 1977, Relationships of Perceived Job Design Characteristics to Job Ability Requirements and Job value, Journal of Applied Psychology pp 760-763 Wiersma, U.1992, The Effects of Extrinsic rewards in Intrinsic motivation: A Meta-Analysis, Journal of Occupational and organisational psychology pp 101-114. Earn, B. 1982, intrinsic Motivation as a Function of Extrinsic financial rewards and subjects of locus control, Journal of Personality pp 360-373. Hackman, J. & Oldham G.1980, Work Redesign, Upper saddle River, NJ: Pearson education, inc, pp 78-80. Marks, et al.1986, Employee participation in a quality Circle program: Impact on quality of Work life productivity and absenteeism, Journal of applied Psychology 71(2): 61-69. Levine, D. 1990, Participation, Productivity and the Firms environment, Carlifornia management review 32(4) 86-100. Soo, J. 2010, The Interaction effects of Scheduling control and work-life Balance Programs on job satisfaction and mental health, International journal of Social welfare pp 135-143. Read More