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Hence, reward system in organization can be defined as “The degree to which reward allocations (i.e., salary increase, promotions) are based on employee performance criteria in contrast to seniority, favoritism and so on.” However, reward systems are more than bonus and stock options. As Steve Jobs says “The journey is reward”; often rewards include both of these incentives, they can also include other recognition such as reassignment, non-monetary like vacations.
Abraham Maslow’s theory of needs hierarchy explains the needs of human beings into five hierarchical categories namely physiological, safety, social, esteem, and need for self-actualisation. On the contrary, Victor Vroom’s expectancy theory explains why employees act the way they do, in light of their aspirations and their expectation of reaching those goals. These two theories are renowned frameworks that are used to create effective reward systems in organisations.
Intrinsic rewards are intangible, i.e., feeling of accomplishment and a sense of achievement. These rewards are those that produce non-quantifiable, personal satisfaction and a feeling that the work of employee is appreciated. On the other hand, extrinsic rewards are tangible outcome such as monetary, promotion, bonuses and sales prizes. Such employees are thought to be motivated to work hard to produce quality results when extrinsic rewards are offered.
In research paper of “Management implication of the interaction between intrinsic motivation and extrinsic rewards” by David Beswick of University of Melbourne, when employee is intrinsically motivated, they are more aware of wide range of phenomena while giving more attention to complexities, inconsistencies and unexpected possibilities. Such employees need time and independence to make choices, to collect and process information, and to get applauded for well
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(“Human Resources - Pay Plans Essay Example | Topics and Well Written Essays - 750 words”, n.d.)
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(Human Resources - Pay Plans Essay Example | Topics and Well Written Essays - 750 Words)
“Human Resources - Pay Plans Essay Example | Topics and Well Written Essays - 750 Words”, n.d. https://studentshare.org/miscellaneous/1567839-human-resources-pay-plans.
The research has discussed how technology today can computerize everything and, therefore, posing challenges to some companies. The departments of human resource can be taken over by the advanced technology or be outsourced to vendors who provide excellent services at an affordable price because this is the current trend in most business
In most cases, organizational performance is being evaluated based on how the corporate managers and the rest of the employees are able to perform their assigned tasks effectively. Given that performance management is all about managing the human resources, Pulakos revealed that performance management is one of the most difficult to implement within a business organization (3).
It has been observed that the existing incentive systems for doctors and hospitals do not contribute towards a subsequent improvement in the quality of health care. As such, the article advocates that effective implementation of pay-for-performance programs are most likely to bring about desirable changes as this would culminate in better health care.
Microsoft provides compensation as well as benefit packages to its employees to an above average limit. But considering the past five years, it can be seen that many benefits have been cut short. One of the main benefits taken away was the Employee Stock Purchase plan.
The principal role of human resource management is to increase the efficiency and involvement of employees in the accomplishment of organizational goals and objectives by encouraging them to use their creative abilities, expertise, and talents. The human resource department establishes and maintains good relations.
Human resource management represents the function within an organization that centres on recruitment, availing direction for individuals working within the organization, and management of employees. Effective HRM allows employees to contribute effectively and productively to the overall success and attainment of the organization’s goals and objectives.
Reward strategies also have economic influence. They affect the business competition and create greater job mobility. The connection between business, Human Resources and Reward is that in terms of business, rewarding improves customer service.