Impact of Reward Approaches and Packages on Organisational Culture and Performance

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Centre number 534
Student name MARIAN BATCA
Student ID number 40716022
CIPD number 59606173
Unit code R104- 5C001
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Assessment submission date 23-5-2022
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Table of Contents
Task One – Guidance Document.....................................................................................................5
Section One - The Impact of Reward Approaches and Packages...................................................5
AC 1.1: Reward Principles and Its Importance to Organisational Culture and Performance
Management................................................................................................................................5
Fairness....................................................................................................................................5
Consistency..............................................................................................................................5
Equity.......................................................................................................................................6
Transparency............................................................................................................................6
AC 1.2: How Reward Policy Initiatives and Practices Implemented..........................................8
AC 1.3: Impact of People and Organisational Performance on Approach to Reward..............10
AC 1.4: Different Types of Benefits Offered by Organisations and The Merits of Each.........11
AC 1.5: Extrinsic and Intrinsic Rewards to Improve Employee Contribution and Sustained
Organisational Performance..........................................................................................................12
Section 2 – Benchmarking Data to Inform Reward Approaches..................................................14
AC 2.1: Assess the business context of the reward environment..............................................14
AC 2.2: Appropriate ways to gather benchmarking data and measured to develop insight......15
Employee Survey...................................................................................................................15
Industry Analysis...................................................................................................................15
AC 2.3: Organisational reward packages and approaches based on insight..............................16
AC 2.4: legislative requirements that impact reward practice...................................................17
References......................................................................................................................................19
Task Two – Blog Article...............................................................................................................21
AC: 3.1 Different Approaches to Performance Management...................................................21
1. Reward exemplary performance.................................................................................21
2. Introduce mentorship programs in the workplace.......................................................21

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3. 360-Dregree Appraisal................................................................................................22
AC 3.2: role of people practices in supporting line managers to make consistent and
appropriate reward judgements..................................................................................................22
AC 3.3: how line managers make reward judgements based on organisational approaches to
reward........................................................................................................................................23
References......................................................................................................................................24
List of Figures
Figure 1 Principles of Reward.........................................................................................................6
Figure 2 Reward Policies and Practices Implementation................................................................8
Figure 3 Narrow-Graded Structure................................................................................................16
Figure 4 Broad-graded Structure...................................................................................................17
Figure 5Narrow and broad-banded structures...............................................................................17

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Task One – Guidance Document
Section One - The Impact of Reward Approaches and Packages
AC 1.1: Reward Principles and Its Importance to Organisational Culture and Performance
Management
In the context of an organisation, "reward strategy" refers to the process of formulating and
carrying out reward policies and procedures that contribute to and advance the organization's
goals. When it comes to how they should be rewarded, every organisation has options. Others
prefer to vary pay according to individual or team performance in order to motivate employees to
behave or perform in ways that are desirable for the company. Some choose to provide stable
basic salaries with predictable annual increases in order to increase retention and commitment,
while others choose to do so because it is easier. Some companies use what is known as a Total
Reward strategy, which incorporates not just monetary compensation but also benefits, chances
for professional growth, and the conditions under which employees are required to do their jobs.
The term "strategic reward" might be used to characterise any of these different techniques.
Following are the principles of reward strategy, which are important to organisational culture and
performance management:
Fairness
Fairness is the first and one of the most important principle of reward system. Fairness means
appropriate incentives. However, implementing this particular principle can be hard. When one
person gets paid less than another for the same task, the underpaid worker may be upset. Though
one employee performs better than another, even if they do the same task and get the same pay,
the superior performer may consider the incentive structure unfair. Different people put different
emphasis on different criteria when judging fairness. Highly rewarded employees are more likely
to contribute to corporate goals. Pay fairness seems to have little benefits when seen in isolation.
As a result, employee performance improves, leading to a healthy organisational culture where
each person strives to offer his/her best and raise profit margins.
Consistency
Consistency is another principle of reward system that has an influence on the culture of an
organisation as well as performance. It is far more probable that workers will increase their
productivity and contribute to the goals of their organisation if they are consistently
acknowledged and rewarded for their efforts.