Importance of Reward System in Employee Performance

The assignment delves into the importance of a well-structured reward system in enhancing employee performance, motivation, and productivity. It discusses various models and techniques that can be applied to encourage employees, making it easier for organizations to achieve their targets on time. The report references Wilson Bros. Case as an example of how reward systems can have a positive impact on business outcomes.

Employee Reward

Table of Contents
INTRODUCTION...........................................................................................................................1
QUESTION......................................................................................................................................1
1. Organisation reward plan with proper information communication to employees.................1
2. Purpose of organisation reward plan ......................................................................................2
3. Using appropriate theory identify the types of reward............................................................2
4. Suitable recommendations to improve reward plan system....................................................3
5. Recommendations by using Wilson Bros. Case scenario.......................................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Employees of any organisation are helpful in attain all the targets and goals in an
effective manner. Hence, for achieve such goals, management have to use variety number of
approaches through which they can encourage their workers to work with more will and enable
them to ascertain maximum profit (Chiang and Birtch, 2011). Employee reward is a concept
which signifies about that how an organisation employees are going to encourage to perform
each and every sort of activity in an appropriate manner. This report is based on the Fairmont
pacific rim which is one of a luxury hotel in UK. For any service sector organisation, they have
to choose appropriate factor through which quality service can be address to their guest. Hence,
management have to prepare a reward plan and communicate it properly to users. Also, purpose
behind such thing is described in this assignment. Moreover, with appropriate recommendations
management have to improve their plan of reward. This reward system is manage with support of
HR department of a company.
QUESTION
1. Organisation reward plan with proper information communication to employees
Reward consider as such factor of a business which is used with a purpose to motivate
their number of employees. This is termed as essential thing because with the assistance of this
management can increase their productivity and services which are provided by them. A perfect
management plan is must for this purpose and communicate the same with number of
employees. Fairmont Pacific Rim offers to their associates some number of benefits and reward
through which they can gain proper attention of their employees on services which serve by
them.
 Discount card: Management provide a discount card to their associated under which
they can gain the benefit of services on appropriate discount rate on services which offer
by an organisation (Wei, Frankwick and Nguyen, 2012). Also, they are capable in taking
the advantage of any kind of health care services not only them by their family also.
 Associate stock plan: As per this, company offer some number of stock to their
employees at the time when they cross a maturity period. Associate do not need to pay
some amount of money for that but they can gain the benefit of that by taking profit
margin.
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 Bonus programme: Company started a bonus programme through which if an employee
perform well and aid in increasing the sales of an entity by offering quality services then
they gain a bonus for that. This event is also consider as a part for encouraging number of
associates.
 Free care and school facility: If an employee of reference hotel is remain with them for
more than two years than organisation offer them a facility of free health care facility to
family also (Shields and et. al., 2015). Along with that, they also pay the fee of their
children school so that they can remain work with Pacific for long term.
2. Purpose of organisation reward plan
The major purpose of reward plan is to increase the productivity and maintain the
employee turnover for each year. If company is not going to use appropriate technique for
motivation then they have to suffer heavy turnover and loss (Sandhya and Kumar, 2011). The
main reason for such type of reward management plan is to make their employees highly
motivated for task which they perform in an organisation. A perfect plan is must for attain a
project or activity which company is going to inaugurate. The major purpose of reward plan is to
motivate their employees which made a positive and negative impact on their employees. Hence,
a perfect plan is one which signifies only the positive influence not negative. Different associate
behaves differently on reward plan so management have to prepare such plan in which all of
their employees get equal weight.
 It is a duty of leader to implement reward plan and manage it properly so that whole task
get done effectively.
 Think about each and every individual not on a single person.
 Prepare a separate column for bonus so that they can arrange it properly without harming
other activities of an organisation.
Fairmont Pacific Rim have to implement this thing in an effective manner so that they can attain
all of their targets and their employees get reward according to what they need.
3. Using appropriate theory identify the types of reward
The study of application and knowledge of how an people, employee or group act in an
organisation is known as Organisational Behaviour or OB theory. Working together as a team
helps an organisation to achieve more in a business. One of the factors that directly effects the
profitability of an firm is its employees productivity. So it is in full favour of an organisation to
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increase productivity of an organisation whenever possible. Organisation must provide friendly,
fun loving and safe environment for their workers. Company must offer its associates with open
and honest communication so that they can voice their concerns and opinions directly to their
managers. Rewards are positive outcomes that are earned by an employee by their performance.
There are two types of rewards intrinsic and extrinsic.
 Intrinsic reward: Intrinsic reward is for internal motivation that cannot be achieved by
extrinsic factors. According to theories most important reward is that what comes from
within (Presslee, Vance and Webb, 2013). Thinking of the accomplishments a employee
has achieved motivates him a lot. Extrinsic rewards helps in motivation but its not
everything that motivates an employee. Intrinsic reward gives backup that reflects
personal ability, competency, knowledge and self control over any work that was
achieved by higher efforts.
 Extrinsic rewards: This reward is that which is provided by company to appreciate an
employees performance. It is highly beneficial in motivating an employee and increasing
their performance. These rewards are tangible and usually financial in nature such as
raise in salary, bonus and promotion etc. these rewards are important because pay, time
off, advancements and recommendations are important at workplace. Due to satisfaction
that will be achieved by an employee because of extrinsic reward workers starts caring
about those task that was not cared before.
4. Suitable recommendations to improve reward plan system
Rewards helps to increase the efficiency of any organisation as the workers gets
motivated. Identifying the desired outcomes of reward in order to develop the most effective
reward plan is important. The goal of reward must be multi faced. It should be designed
according to certain measures like attract talented employee, motivate employee to work at
optimum level, fasten their personal growth and development, increase employee satisfaction, in
order to keep talented employee associated with company (Pratheepkanth, 2011). Managers
create effective reward programs so as to as to achieve the goals. It is important to understand
components that are required to make the reward program successful. Some of recommendations
are as follows:
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 Make reward plan that are for achieving specific goals. This helps organisation in
achieving long term goals. Like if an employee has benefited a company on the longer
go.
 A company can implement an incentive plan for achieving periodic goal. like for sales
employee if they achieved more sales than target set by the company. This helps
company in achieving short term goals.
 Compensate employee for coming early and leaving late. This encourages employee for
working late at the workplace and hence more work can be done.
 Give rewards to employee who come up with new idea and effective ways to complete a
given task. By this company is rewarding an employee for their innovative thinking. And
this helps company in promoting more innovation driven work.
 Make reward plans that are more beneficial to the talented employees than companies
competitors as talented employee always search for such companies and there will not be
chance of failure (Njanja and et. al., 2013).
 Top management should write a personal note of appreciation to the employee, or
appreciating him in front of their peers citing their excellent work that benefited the
organisation. This will enhance the value of reward given to an employee.
5. Recommendations by using Wilson Bros. Case scenario
As per the case scenario of Wilson Bros., the HR managers and their wife at the post of
accountant are getting retired on same day. They are setting up their organisation at different
locations in Canada. They are requiring different staffs or employees who are of different
qualifications. For example they are needed two accounting clerk, four client service people, a
book keeper, one receptionist, an office manager for the on-site of Scarborough plant. For this
they have to do some reward planning. This plan is given below:
 Providing incentives: Organisation have to make some schemes about earning more
money. For this workers have to do extra task of high quality. Enterprise will provide 500
Euro for keeping book more properly (Güngör, 2011). Receptionist can also earn more
revenue if they do her work more properly.
 Providing transport facilities: Organisation should provide transportation facilities to
their employees. This will motivate them as they have to face a large crowd or traffic. So,
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firm will send their vehicle to each worker home. This will also enhance the attendance
of them.
 Providing them two holidays: Enterprise should also provide at least two holidays
namely on Saturday and Sunday (Cho and Perry, 2012). This will make them more happy
as they have now much time to rest and entertain.
Additionally, Wilson needed six bakers, eight packagers, one plant manager, two supervisor for
their another firm. Wilson have to make some rewarding plans in order to motivate their workers
that are following:
 Company should give additional money for extra packaging of goods in relation to their
daily work.
 Corporation should provide food facilities to their employees as large number of people
are out of the city and have to make their meal by themselves (Chiang and Birtch,
2011). This made a pressure on them as they have to make breakfast and lunch before
coming to office. So, if company provide them better food facilities then this will
inspires them and ultimately they come at right time on office.
CONCLUSION
The major finding of this report is reward system is an essential tool through which
management can gain maximum outcome from their associates. By applying various models and
techniques it become easy to encourage number of employees through which target get attain in
minimum time period. A perfect plan is also having a positive impact so that organisation have
to implement that. As per Wilson Bros. Case it become easy to measure that reward system is an
essential tool which every business entity have to implement. Moreover, by consulting OB
theory, various number of rewards are also define in an appropriate manner.
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REFERENCES
Books and Journals
Chiang, F. F. and Birtch, T. A., 2011. Reward climate and its impact on service quality
orientation and employee attitudes. International Journal of hospitality management. 30(1).
pp.3-9.
Cho, Y. J. and Perry, J. L., 2012. Intrinsic motivation and employee attitudes: Role of managerial
trustworthiness, goal directedness, and extrinsic reward expectancy. Review of Public Personnel
Administration. 32(4). pp.382-406.
Güngör, P., 2011. The relationship between reward management system and employee
performance with the mediating role of motivation: A quantitative study on global banks.
Procedia-Social and Behavioral Sciences. 24. pp.1510-1520.
Njanja, L. W., and et. al., 2013. Effect of reward on employee performance: A case of Kenya
Power and Lighting Company Ltd., Nakuru, Kenya. International Journal of Business and
Management. 8(21). p.41.
Pratheepkanth, P., 2011. Reward system and its impact on employee motivation in commercial
bank of sri lanka plc, in jaffna district. Global Journal of Management and Business Research.
11(4).
Presslee, A., Vance, T. W. and Webb, R. A., 2013. The effects of reward type on employee goal
setting, goal commitment, and performance. The Accounting Review. 88(5). pp.1805-1831.
Sandhya, K. and Kumar, D. P., 2011. Employee retention by motivation. Indian Journal of
science and technology. 4(12). pp.1778-1782.
Shields, J., and et. al., 2015. Managing Employee Performance & Reward: Concepts, Practices,
Strategies. Cambridge University Press.
Wei, Y.S., Frankwick, G.L. and Nguyen, B.H., 2012. Should firms consider employee input in
reward system design? The effect of participation on market orientation and new product
performance. Journal of Product Innovation Management. 29(4). pp.546-558.
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