Human Resource Management: Total Reward Theories and Practices Report

This report provides a comprehensive overview of human resource management, focusing on total reward models and their significance. It defines total rewards, explaining its components like base pay, benefits, learning and development, and organizational culture. The report delves into relevant theories such as Reinforcement, Expectancy, and Equity theories, analyzing their benefits and drawbacks. It further explores compensation models, highlighting their structures and objectives. Practical examples from Tesco and ASDA illustrate the application of these theories and best practices in areas like employee security, selective hiring, and performance-based compensation. The report concludes with a critical analysis of fairness and equality within the total reward systems of these organizations, offering valuable insights into effective HRM strategies.

Managing Human
Resources

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
Definition, explanation, theories and analysis of total reward models........................................1
Example of practice from two named organisations, how they apply theories, best practices
and approaches.............................................................................................................................4
Critical thinking analysis in context of these two firms on matter around fairness and equality7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Human resource management is the strategic approach to the effective and green
management of people in an employer or organization such that they help their commercial
enterprise benefit a competitive gain. Managing human resources refers back to the capabilities
that a manager plays relative to the agency's employees. Managing Human Resources also can
confer with the act of presenting the control actions the personnel of the Human Resource
Department. This assessment will define information about total reward, theories and analysis of
total reward models by considering their benefits and drawbacks (Szota, 2018). Moreover, it will
discuss about application of theories, best practices and approaches to reinforce manage and
drive effective performance with the consideration of example of two organisations. Further, it
will explain about the analysis in relation to these two enterprises on matters around fairness and
equality in the organisations’ total reward system.
MAIN BODY
Definition, explanation, theories and analysis of total reward models
Definition- Total rewards is the aggregate of benefits, compensation and rewards that personnel
acquire from their companies. This can consist of wages and bonuses in addition to popularity,
administrative center flexibility and profession opportunities. Total rewards might also talk to the
characteristic or branch within HR that handles repayment and blessings, or the mixed intrinsic
and extrinsic rewards (or cost) that an employee perceives. Total reward has components; in its
purest form it is the entire package of blessings, which include finance, pay, bonuses, cars;
worker recognition, opportunities, quality of operating lifestyles and different non-economic
factors. Total praise includes four superb factors:
Base and variable pay- It is a financial element and needs to be consistent with market
expectations for it to live a hygiene element. Depending on supply and contact for and the extent
of opposition your commercial employer is coping with, you could determine to pay constant
with the marketplace, over the marketplace or have the highly-priced to pay beneath marketplace
price (Raudeliūnienė, Davidavičienė and Jakubavičius, 2018). There want to be an element of
equity and a notion that your base and variable pay supplying is regular with marketplace
expectations.
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Pension and blessings- The 2nd monetary thing of overall praise, pension and blessings,
affords extra triggers for people to go back and work to the organization. Most humans revel in
flexibility and desire near pensions and blessings and with the contemporary multigenerational
body of employees, benefit services are expected to satisfy personnel’ individual desires,
irrespective of which stage they are at of their careers or non-public lives.
Learning and development- The 1/3 element of normal praise, studying and
development, specializes in humans’ profession aspirations. Once the financial factors have met
their expectations, they'll turn their interest to growth and development opportunities. They start
to have an take a look at the possibilities their organisation offers (Wilkinson and et. Al., 2018).
They make decisions approximately their subsequent steps and whether or now not they want to
stay of their modern-day role or search for a profession trade or development.
Organisational way of life- The fourth and very last detail of preferred reward –
organisational way of life – represents all your corporation has to provide besides money,
studying and improvement. For an enduring and fruitful dating with their corporation, however
lengthy or brief this courting may be, it is essential that employees feel “relaxed” inside the
workplace to perform to the great of their competencies.
Theories of total reward
The description of some reward or compensation theories is as below:
Reinforcement and Expectancy Theory- The reinforcement concept postulates that a
conduct which has a worthwhile revel in is probable to be repeated. The implication for
remuneration is that high employee not unusual widespread performance discovered by way of
way of a economic praise will make future worker average performance more likely. By the
same token, a excessive usual ordinary overall performance no longer located through the use of
a reward will make its recurrence not probably in future (World Health Organization, 2018). The
idea emphasizes the significance of a person in truth experiencing the reward. Like the
reinforcement principle, Vroom’s expectancy idea specializes within the hyperlink amongst
rewards and behaviour. Motivation, regular with the principle, is the product of valence,
instrumentality and expectancy. Remuneration structures variety in keeping with their effect on
those motivational additives. Generally speaking, pay structures variety maximum of their effect
on instrumentality the perceived link between behaviour and pay. Valence of pay consequences
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remains the identical below actually certainly one of kind pay systems. Expectancy perceptions
often have greater to do with method layout and education than pay structures.
Benefits- The advantage of this principle is that it facilitates in motivating personnel due
to the fact whilst employees recognize that the employer is helping their expectancies then they'll
paintings tough with honesty main to the fulfilment of the objective by using the agency.
Drawbacks- The largest downside of this concept is that expectancies of all personnel
cannot be same and at the same time has come expectancies can be met but to think that
expectations of all personnel might be met isn't viable which makes principle impractical.
Equity Theory- Adam’s equity concept says that a employee who perceives inequity in
his or her rewards seeks to restore equity. The concept emphasizes equity in pay shape of
employees’ remuneration (Kisakye and et. Al., 2018). Employee’s perceptions of the way they
may be being handled by the usage of their organizations are of pinnacle significance to them.
The dictum ‘a sincere day art work for sincere day pay a experience of fairness felt via manner of
employees. When personnel apprehend inequity, in can bring about decrease productiveness,
better absenteeism or growth in turnover.
Benefits- The key benefits of this concept is that when employees revel in equity, the
achievement degrees of personnel increase. Employees may even have a greater retention fee
because the employees would love to stay with the agency because the rules are equitable.
Drawbacks- The first and primary downside of equity concept of motivation is that
there's distinction in belief among enterprise and worker due to the fact a employee may think
that he or she is working identical as other worker but getting less pay but it may be possible that
any other employee according to company is more effective and green than other employee and
that is the reason why he or she is getting higher pay than other employees.
Models of Total reward
The pay model of compensation- This model Enables managers to structurally layout and
apprehends the repayment device for his or her employees. The model consists of 3 predominant
additives: aim of the remuneration model, the policy that is the foundation for the form, and the
techniques that hyperlink the coverage to the objectives. Compensation consists of the primary
income further to rewards in the shape of bonuses, more time, go away, insurance, organization
vehicle, price account, and one-of-a-kind benefits (Mohelska and Sokolova, 2018). Not all
reimbursement models are alike. Some plans located the emphasis on the simple earnings, at the
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same time as others are extra targeted on the use of overall performance incentives. Some
employer also provides income percentage schemes to their employees in the event that they
assist to increase manufacturing and decrease costs.
The reimbursement model that a corporation makes use of need to suit the enterprise
agency goals. This can assist decide which plan is the most useful in the long term. This
approach that factors from particular reimbursement fashions are on occasion blended (Khan and
et. Al., 2019). The remuneration plan furthermore wants to be on par with that of the opposition
or be higher. And it’s critical to conform to crook guidelines and guidelines.
Benefits- This model is essential if you want to make equity in reward device, reward
overall performance and meets the desires of the people. Fairness is the foundation for healthy
work relationships, this means that that that it’s critical that employees are treated fairly and get
income that fits the works they do.
Drawbacks- Employee bonuses can probably grow to be disadvantageous because they
could induce worker contention in preference to encourage worker teamwork. For example, if a
enterprise rewards employees with bonuses primarily based on hourly paintings for the 12
months, personnel will be not going to percentage paintings with their colleagues, which can
bring about inefficiency because a few employees could need to take on extra paintings than they
could qualitatively take care of while others are left with too little paintings to do.
Example of practice from two named organisations, how they apply theories, best practices and
approaches
Here, Tesoc and Asda are taken in to consideration as example. Both organisations operate
their business in retail sector. In order to reinforce, manage and drive higher levels of
performance, they follow effective practices, theories and approaches of HRM. The description
of some practices is as below in context of these respective firms:
Providing security to employees- The first Human Resource best exercise is employment
safety. Life is unpredictable and work is a robust element this is very important to most people.
Having a organization who permits the worker to provide for themselves and their circle of
relatives is, in essence, the primary purpose why human beings come to work (Alajmi and
Lengyel, 2020). For example, Tesco and ASDA provide safe and secure workplace to their
employees so that they feel safe and motivated as well as perform their assigned work in
effective manner within provided time frame. Along with this, they also provide them some
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safety and security benefits in term of life insurance, medical facilities and many more. This also
support in reinforce, administrate and drive employees to perform well.
Selective hiring- It is another practice which supports the firm to bring in employees who
add value. By using effective methods and tools of recruitment and selection, the management of
organisation hire skilled and talented people (Santos and Almeida, 2019). For example, in ASDA
and Tesco, the HR managers of the venture consider effective selection and staffing tools and
techniques to hire skilled workforce which support in business growth and development.
Fair and performance based compensation- It is one of the practices and has everything
to do with compensation and benefits. With the assistance of this practice, the management
motivate and manage skilled workforce by making fair and performance based compensation.
For instance, In Tesco and ASDA, the management of the company follow effective
performance management tools and approaches so that they can fairly rewarded their employees.
This support in retaining reinforcing, encouraging and driving employees to perform well as well
as contribute in success or growth of company.
Theories of Human resource management
There are different methods, conceptions and theories of HRM and these concepts are
used by the management of the company to motivate, compensate, reward and many more
(Olander and Hurmelinna-Laukkanen, 2019). The description of some theories is as regarding
ASDA and Tesco:
Frederick Herzberg’s Motivation-Hygiene Theory- The Herzberg’s Motivation-Hygiene
Theory is given by means of the use of the use of Fredrick Herzberg and his buddies, who
studied the variables which is probably gave the impression to be perfect to acquire desires and
the undesirable situations to avoid. The first set of manner situations has been called protection
or hygiene factor, wherein the identical challenge situations provide the same diploma of
dissatisfaction, in case the situations are absent, however, their presence does now not encourage
in a strong way.
Hygiene Factors: Herzberg recognized ten safety or hygiene elements, that aren't intrinsic
factors of a pastime, but are related to the situations wherein the undertaking want to be
achieved. These are business enterprise policy and control, technical supervision, process
security, operating situations, interpersonal courting with friends, subordinates and supervisors,
income, task protection, non-public life, and many others.
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Motivational elements: These elements have an advantageous effect at the functioning of
the employees inside the agency like Tesco and ASDA. There are six elements that encourage
employees: Achievement, Recognition, Advancement, Work-itself, Possibility of growth and
Responsibility. A boom in those elements satisfies the personnel and the decrease in those will
now not have an effect on the volume of satisfaction.
Thus, Herzberg’s Motivation-Hygiene Theory studied the variables which had been liable
for the quantity of delight and were carried out inside the employer that has given severa new
insights (Pujiono, Agustono and Aulia, 2021). The second set of project situations is called
motivational factors, which frequently carry out to construct sturdy motivation and immoderate
hobby delight, however their absence does now not bring about sturdy displeasure.
Agency Theory: This idea states that every company like ASDA and Tesco and the worker
are the stakeholders of the company, and the remuneration paid to the worker is the organisation
value. The worker will try to get an increased employer fee whereas the enterprise will attempt to
restriction it. Hence, the remuneration need to be determined in any such way that the hobby of
each the events may be aligned. Thus, this concept posits that the compensation within the form
of salary or wages can be decided at the idea of the very last consequences or the behaviour of a
worker.
Reinforcement Theory- This concept of motivation pursuits at accomplishing the popular
diploma of motivation a number of the employees via reinforcement, punishment and extinction.
Reinforcement technique, which can be every fine and horrible, is used to beautify the favored
conduct. Punishment acts as a deterrent to unwanted behaviours of the employees. Extinction
refers to diminishing the chance of unwanted behaviour. This concept of motivation absolutely
focuses on what takes vicinity to a individual on the equal time as he/she takes some movement.
It is not any way related to the inner nation of an character i.E., inner feelings and drives of
someone is omitted. Following are the techniques for controlling the conduct of the personnel −
Positive Reinforcement− Positive reinforcement explains that, even as an employee gives a
effective and a required behaviour, the response inside the course of them need to be notable
(Tomer and Budhwar, 2020). This stimulates the superiority of a conduct. Reward to a employee
who performs well reinforces his/her desire to perform higher due to high-quality results of
doing so.
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Negative Reinforcement− Negative reinforcement takes vicinity even as terrific deterrents
or obstructions is eliminated and the worker(s responds to a favored behaviour after such
removal. For instance, an employee who commutes from a protracted distances wraps up a few
duties quicker than favored; but, whilst he's told thru the manager to take the tasks domestic for
more than one days and entire them, it stimulates him/her to art work as anticipated. By
disposing of the horrible stimuli, the favored behaviour is strengthened.
Punishment− Punishment refers to enforcing terrible effects or casting off tremendous
effects with the intention to save you employees from repeating undesirable and uncalled for
behaviours (Dey, De and Soni, 2019). It can, therefore, be each awesome and terrible.
Extinction− Extinction refers to extinguishing a discovered behaviour by way of way of
withholding a fantastic reinforcement or reward that has advocated the conduct.
The support of all these concepts and theories the administration of Tesco and ASDA can
motivate reinforce and rewarded their employees that will support in drive higher performance.
Critical thinking analysis in context of these two firms on matter around fairness and equality
Equality- They sense compares to the reward capability. From an employee’s element of
view, it comes right down to an honest equation of inputs ought to same outputs. Inputs variety
from enthusiasm to software of abilities, whilst the output sought ought to consist of career
improvement, economic compensation, non-economic reputation, and so forth.
Fairness: Fairness, except fairness, is also perceived or measured in relativity. Employees
gauge equity in rewards relative to others and from what they see and hear in the media — from
the Government, the marketplace, from colleagues, managers, HR and pinnacle control.
The fairness of incentive pay as an oblique shape of compensation is quite important. Incentive
pay consists of structures inclusive of bonuses, commission, income sharing, inventory options
and performance-associated pay (Szota, 2018). It is critical that equity standards are advanced as
they doubtlessly impact an employee’s conduct and attitudes. High appearing organizations like
Tesco and ASDA create relational exchanges in the paintings location which can be based totally
on trust care and understand. These agencies are taken into consideration to be of a high good
sized. Bonus schemes and commission are two of the most common types of incentive based
totally definitely pay. Bonuses are offered while sure requirements of common performance are
met, but if personnel fail to meet those necessities of overall performance then generally bonus
will now not be granted. However, it may be unfair if the worker is not running during the
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busiest periods, therefore stated employee will pass over out on compensation. In order to be
equitable employers should make allowances for situations such as this. Profit sharing has more
than one blessings along with more monetary achievement, excessive tiers of productivity and
terrific worker attitudes. Perceived pay fairness is considered a psychological impact of income
sharing and demonstrates the effectiveness of an earnings sharing plan. Performance-based
totally rewards permit employees to appearance a stronger connection amongst their typical
overall performance and organisational performance. However, this shape of repayment will no
longer work for every organization. Conflicts of interest concerning the equity of these
compensation systems also can purpose troubles inside the work location.
CONCLUSION
This has been concluded from the defined information that human resource management is
an effective process of attracting, hiring, choosing and maintaining employees for the powerful
going for walks of enterprise venture. By considering effective models and theories of reward or
compensation, the management can manage or reinforce their employees. Along with this, there
are different theories and practices of HRM which support in management of skilled workers.
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REFERENCES
Books & Journals
Online
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