Performance and Reward Management: A Comprehensive Guide

This comprehensive guide explores the principles, systems, procedures, best practices, and challenges of performance and reward management. It delves into the importance of aligning reward systems with organizational goals, fostering employee motivation, and ensuring fair and equitable treatment. The guide also examines the impact of reward management on employee engagement, productivity, and overall organizational success.

PERFORMANCE AND REWARD MANAGEMENT
NAME OF THE STUDENT
NAME OF THE UNIVERSITY
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Contents
Introduction................................................................................................................................3
Principles of performance and reward management..................................................................3
System of performance and reward management......................................................................5
Procedure of performance and reward management..................................................................7
Best Practices of performance and reward management...........................................................8
Challenges of performance and reward management................................................................9
Conclusion................................................................................................................................11
References................................................................................................................................12

Introduction
According to the today’s world, decoration for more better success and performance interests
further than these actual procurement oneself. Actually, as the universal economical crisis
portrayed, decorations were the entire thing for the bank employees as they stroked for more
careless betting’s and expanding risk pursuing. As of the organizational flaws rewards,
incentives were viewed to the utmost award those were bigger than this obvious procedures
of gaining. Therefore, prize management have to be viewed into the circumstances of which
are the appropriate awards and which were the inappropriate awards. These points that the
employees earns are the awards those are ought to represent their performances and therefore
does not cross them. The ultimate meaning of the reward management is that it is justified to
acknowledge the employee for his or her wonderful performances.

Principles of performance and reward management
The performance and reward management efficiently incorporates the organizational goals
and objectives into departmental, team, divisional and individual objectives, which may be
summarised in the following part:
 This proves to be helpful for clarifying the organizational objectives and goals.
 This proves to be an evolutionary and a continual process where the performances
undergo improvements over a period of time.
 Cooperation and consensus are the most reliable procedures rather than compulsion
and control.
 A distributive and mutual understanding is created regarding the performance
improvement requirements and the associated achievement processes (Yuan et al.,
2018).
 Provides encouragement for self management of performances on an individual level.
 An honest and open style of management is required for an interactive communication
encouragement amongst the subordinates and the superiors.
 A continuous process of feedback is required and on the basis of this, the
organizational objectives and goals can be modified through the knowledge and
experiences gathered by the individuals in the job.
 This is responsible for assessment and measurement of the performance versus agreed
and shared objectives and goals.
 This should be applied to each and every workers and staff members.
 The primary concern shouldn’t be the linking process between the financial rewards
and the performance.
It can be added to this that management of performance is majorly related to support and
boost provision and also direction of process.
Reward management concerns the execution and formulation of various policies and
strategies which sets a goal of rewarding workers equitably, consistently and fairly, as per
their organizational values. This majorly involves control and analysis of salaries paid to the
workers, benefits and reimbursements. It mainly aims at creating and operating a structure of
rewarding system within an organization efficiently (Ahenkan et al., 2018). Now, this
structure of reward system majorly consists of payment practices and associated policies,
administration of payroll and salaries, minimum wages, aggregate rewards, team rewards and

executive payments.
Reward management mainly deals with the strategies, processes and policies that essentially
guarantees the workers' contributions within the organization that gets acknowledged by
every possible means. This system mainly is responsible for employee motivational purposes
so that they can reach their assigned goals that certain entities set up. The reward
management, other than being concerned about employee payments and benefits, it equally
pays heed to certain rewards that are nonfinancial, for example, development, training,
acknowledged and incremental job duties and responsibilities (Israel, 2018).
As per extensive researches 10 axioms have been identified for application of the
aforementioned principles:
 ‘driven by organizational values and purposes.’
 ‘acts as a tool of management that can be considered to be helpful for the
management skills of the managers associated.’
 ‘for obtaining solutions which work.’
 ‘more emphasis is placed on the changing patterns of behaviour than the paperwork.’
 ‘main focus is on certain things that can be done for achieving improvement that is
visible.’
 ‘this mainly deals with management of people rather than system.’
 ‘the operations of the managers as a fundamental procedure of management is majorly
performance management.’
 'although performance management runs on the basis of certain acknowledged
principles, yet it operates quite flexibly.’
 'more than paying, development is the main focus.’
 ‘mostly success is dependent on the market the organization operates in and it
requires an alignment along with the performance culture.’
According to Chang et al. (2018), certain explanations have been introduced regarding the
principles of the performance management approaches, which are as follows:
 Establishment of clear and simple plans of performance that provides a framework to
the managers regarding differentiation and recognition of the individual colleagues'
contributory activities and later they get rewarded by payments.

 Employing a process of simpler nature that helps in removal of paperwork that is
unnecessary.
 Ensuring resolution regarding any performance issues of capabilities or any shortfalls.
 An exception in the case of documentation.
It can also be stated that performance management involves guiding, motivating, coaching,
rewarding and appraising the co workers for potential unleashing and obtaining
improvements in the performances of the organization. For a well built operation, a top notch
leadership and coaching and guiding relationship amongst the teams and their consecutive
managers are the main contributors (Barth and de Beer, 2018).

System of performance and reward management
In the virtual sense, all the organizations has its own system of management of performance
that is responsible for accomplishment of various crucial objectives and goals expectedly
relating the management of human capital. The goals and objectives frequently involves
providing help to individuals for skill development, promotion determination, performance
motivation, building up a culture for performance, providing help for organizational strategy
implementation and termination or elimination of workers who perform poorly (Migdadi et
al., 2018). Although the accomplishment of the goals and objectives through system of
management of performance contributing to the effectiveness of the organization positively is
a bit doubtful, yet the practices of system of management of performance being effective is
not clear.
Certain large numbered contrive features can be influential on the system of management of
performance effectiveness potentially and most of them are studied, assessed and examined
empirically for the resultant impact determination. For instance, according to significant
researches it may be observed that the effectiveness of management of performance increases
with utilization of measures that are behaviour based, ongoing processes of feedback, current
objectives and skilled reviewers are hired. Only one determinant is present that potentially
determines the effectiveness of the system of management of performance although it doesn’t
attract much of attention: the degree at which the results of system of management of
performance are tightly tied to the considerable rewards (Singh et al., 2018). The lacking of
attention towards the impact can be marked in particular when the problems of utilization of
the system of management of performance for terminating or removing the workers from the
company who perform poorly.
Various reasons have been put forward based on the belief that systematically relating system
of management of performance outcomes to rewards provides effectiveness along with
motivation, although some suggests that this may end up contributing in lowering
effectiveness in relation to the development.
As opined by a well known article by Taba (2018), an argument has been put forward
regarding the tying of rewards with the discussions of performance that workers or
employees are more inclined towards hearing only the portion of rewards system and not the
significant feedbacks which allows the development and improvement of skills and

performances. This resulted in organizations separating rewards discussion from performance
discussions.
Alternatively, rational arguments are produced regarding tying up performance outcomes to
rewards that may end up leading to system of management of performance effectiveness
strongly. Managers will focus more on conduction of better jobs as the appraisal outcomes
can be significantly impactful on the capabilities of rewards allocation on the basis of
providing motivation to the workers under them and the performances. Simultaneously on the
individual level, they are aware of the reviews of performances that impacts the rewards
which are proved to be crucial for them which in turn will motivate and prepare them for the
season (Li et al., 2018). Moreover, high chances are there while appraisal are utilised for
rewards determination, companies will focus more on employee differentiation by the
managers those are being appraised, as appraisal procedures are the most important factor in
the individual rewarding systems regarding their performances.

Procedure of performance and reward management
Presentation management is the system that have been becoming popular progressively. This
in turn makes way to procedures which on implementation helps an organization to work towards
creating an environment of work which provides support to the working processes and
performances of the employees on the basis of their best capabilities. The procedure that the
workers chooses for achieving their goals, regularly fluctuates varying from one business then onto
the next business (Wamweru and Makokha, 2018). In spite of these varieties, the presentation
management procedure therefore includes various types of assessment, objective setting and the
award. Furthermore, training is offered on a regular basis across the aggregate procedures.
Arrangement
The phase that involves arrangements of the management of performance procedure is projected
for setting the anticipated objectives that are essential to the workers as well as project regarding
the regular level of execution regarding the activities. The needs, demands and requirements of a
given worker regularly depends on the performance they are exhibiting or the posts they are
holding. Towards finishing line of the phase of arrangement the management as well as the worker
is ought to be in an agreement to the terms of the expectations and the reality. Furthermore, the
objectives those are planned should be accomplished inside the duration of a year (Schrock et al.,
2018). The arrangement phase is a vital procedure of the procedure management program of any
organization or body.
Evaluation
An assessment in a yearly basis regarding the execution of the workers is termed as appraisal. This in
turn takes inputs on a regular basis from the colleagues as well as the consumers into believes,
further taking into account the perceptions o the administration. Appraisals likewise incorporates an
auditing of assessments conducted in the recent years and an aptitude evaluation. (Cascio, 2018). A
couple of bosses also has workers for examining and executing their own assessment in contrast
with the overall official aggregative assessment.
Identification
The identification portion of the procedure is tied in with perception and perseverance of the

worker's accomplishments and any regions that requires undergoing changes. Along this process the
organizational manager as well as the workers must communicate regarding approaches required
for up gradations (Kofinas et al., 2018). Administration should likely be available that can be done
alternatively in endeavours for encouraging representatives. In relation to achievements,
representatives may be potentially or verbally acknowledged through advancements and rewards.

Employment progress
This duration of the process is helpful for the progression and the support system of the future
changes and the improvisations of the workers. It should address the concerns of these
business or the organizations, up gradation of their qualities of the representatives and the
performance of the regions of the little up comings. This also includes the requirements
nearby and further more sending these people to off-site requirements. Preferably as with the
different stages or the phases of the process, responds amongst the administration and the
worker is vital. The base of the powerful execution and the administration framework
requires some time and the assets and in these way, with the help of the load up, the official
leader and other senior managers. According to the building up there is another execution and
administration process, an organization that strikes up the advisory group collectively made
of workers, managers and board singulars to expand the purchase in, the comprehension and
also the support for the process (Boddy et al., 2018). Management supports to follow up on
the consequences of the execution management procedure is further more important to
guarantee that the great execution is attained, insufficient performance brings about these
fundamental helps as well as enhances the preparation execution and the reliably poor
performance brings about a variety in the obligations or the end, as fitting.

Best Practices of performance and reward management
Best Practices of performance and reward management
Today organization are demonstrating some high level of duties towards the fortification of
the reward rehearses those are lined up with other human resource zones and the motos of the
organizations for pulling in, then holding and then inspiring the workers. The productive
prize zones helps in drawing the results driven by the experts who can flourish and then
prevail in performance based situations. Henceforth, it is a critical aspiration and may add
towards the improvements of the profitability of the employees if projected appropriately.
For instance, The Airlines of the continents as a piece of their turnaround organization
presented on time reward motivating force bundles as the indicated by which a representative
would pick up a reward of sixty five dollars consistently to ensure on time flight tasks
(Baskaran et al., 2018). A successful award frameworks ought to be connected with the
performance improvement framework, which centres around performance based payment
and offers enough learning openings along with a solid organizations. Different pay can
assumes an essential portion in boosting the performance of the employees precisely the star
entertainers unless than the settled payment. Hardly these such award practices may take the
types of increase sharing, rewards, group based impetuses, benefit sharing, value based
motivating force grants. A productive management of reward framework may have a helpful
impacts upon the projection in a few ways - ingraining a feeling of possession among the
representatives, may encourage long haul centre with consistent change, lessens benefit
working expenses, advances collaboration, limits the representative disappointments and
improved worker enthusiasm for monetary projections of the organizations. Hardly any
organizations, compensate their workers for achieving new abilities which may add the
values of the hierarchical projections and along these lines encourages work turn, broadly
educating and self-guided work groups. Scarcely any organizations likewise accepts
remarkable procedure by giving the acknowledgment honours and the single amount justifies
the grants for the winning representatives responsibilities and then achieving long haul
helpful results. Today, factor pay is an exceptionally imperative parts in the award practices
of an organizations and it varies crosswise over different parts too. Awards can be an
imperative wellspring of the inspiration for the representatives yet just on the off chances that
it is handled under right conditions. Scarcely any procedures which enhances the importance
of prizes are mulled over into a few focuses in that capacity. Connecting rewards with the
execution Implement group rewards for the reliant employments for instance Xerox.

Guaranteeing that the prizes are significant. Illustration Wal-Mart, rewards to the best
administrators which depends on the organization's general execution while the cutting edge
workers acquire reward based on the business figure or targets accomplished by their store.
Guaranteeing that the prizes are esteemed by the workers (Pedersen and Stritch, 2018).
Looking at for the unfortunate results of organization of any reward rehearse other than the
money related prizes, the contemporary representatives want for non fiscal prizes which
might be as better profession openings, aptitudes advancement and acknowledgment
programs. Numerous IT and task based associations give much significance to non-fiscal
prizes for expanding representative fulfilment. Therefore the practices of the reward
management is involved through various stages and contributes to the growth of any
organization and further to addition the terms should be clear between the employer and the
workers such that there is no super expectation regarding their growth and all should be
subject to their considered job roles (Mone and London, 2018).

Challenges of performance and reward management
The performance management fundamental goals and objectives involve improvements and
development in terms of effectiveness of performances of the workers as a team. The workers
team and their associated manager in charge jointly works for monitoring, planning,
appraising and reviewing the employee’s performances that satisfies the aggregate
organizational goals and objectives. Several tools are employed in this regard which ranges
from result-based to trait-based to behavioural basis. The feedback process involves both
informal and formal communicative processes which may be irregular or regular. An ample
amount of effort is made determination of measures and goals in the right path, along with
appraisals, performance and reviews (Tang et al., 2018). Furthermore, certain challenges are
faced due to certain issues which may hamper the anticipated effective performances of the
employees which are mentioned below:
1. Wrong design
The system of management of performance and its associated tools should fit and must be
aligned to the particular organizational requirements and needs. These can never be
duplicated from any other organizational system and hence implemented (even if the
organization operates in the same market or industry or even the same group of
organizations). Consulting several users and shareholders intensely regarding the system is
essential. Gaining the trust of the user is absolutely necessary for succession. Documentation
should be conducted properly and the system must be characterized as equitable and fair
(Kaur et al., 2018). The management of performance is ought to be observed to be a continual
procedure and is not an activity to be conducted frequently. The entire structure of
management of performance must efficiently include performance rewarding mechanisms
and management of the workers who perform poorly.
2. Absence of Integration
The system of management of performance needs undergoing of an integration with the
HRM systems, planning strategically organizational structure, culture and processes along
with major systems associated with the organization (Smith 2018).
3. Lack of Leadership Commitment
The support and commitment that should be provided by leadership is a crucial component
for system implementation in a smooth way. The leaders are responsible for driving the

procedures and implementation of management of performance as a constitutional portion of
the organizational management (Kornelakis, 2018). They not only are responsible for
providing direction strategically, but also for reviewing and monitoring the organizational
performances.
4. Ignoring Change Management in System Implementation
Changes should be managed strategically, as it plays a crucial role in the system
implementation. As the top management is responsible for the operations, more careful
resistance management should be focused on (Barth and de Beer, 2018). A major tool in
change management and intervention is regarded as communication.

Conclusion
In the present focused business condition, organizations are searching for approaches to
enhance their business for getting better results. Workers are the main source to accomplish
comparative advantage. In this way, organizations have begun to put resources into the
human asset to open worker potential in this manner accomplishing better outcomes. This has
offered to the advancement of the reward administration and become a system to accomplish
the wanted occupation outcomes. The human asset administration has numerous devices
those can be used to deal with the worker’s behaviours. One of the instruments is the
management of the rewards. Applying award administration in association to business,
therefore it can enhance business results and can bring a positive move in the workers
conduct and the commitments. For assuring the success of the institution, there should be a
proper legitimate mixture of the awards that could be satisfying both the financial and
personal cravings of the present working groups having the constant business conditions and
also the constraints of the cost.

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