Reward Management Strategies at Nando's Restaurant

This report provides a comprehensive analysis of reward management strategies at Nando's restaurant. It begins with an introduction to the company and its global presence, highlighting its human resource management approach and commitment to employee development. The report then delves into the factors affecting rewards and reward strategy, including both internal (pay scale, business strategy, appraisals, and workforce) and external factors (labor market, market rates, productivity, cost of living, and relevant laws). It explores the factors driving the reward strategy, emphasizing pay scale, benefit plans, and employee recognition. The report identifies various sources of reward intelligence, such as compensation, benefits, work-life balance, performance and recognition, and career development. It examines perspectives of reward decision-making, including efficiency wage, collective bargaining, and competitiveness. Finally, it discusses the advantages of internal and external equity and potential conflicts arising from reward decisions, concluding with a summary of the key findings and implications for Nando's.

Running Head: Reward Management
Reward Management

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Contents
Introduction.................................................................................................................................................2
Factors affecting Rewards and reward strategy in the Nando’s restaurant.................................................2
 Internal Factors................................................................................................................................2
 External factors................................................................................................................................3
Factors driving the reward strategy.............................................................................................................3
Sources of Reward Intelligence...................................................................................................................4
Perspectives of reward decision..................................................................................................................5
Advantages of internal and external equity................................................................................................6
Conflicts in the organization due to reward decision..................................................................................7
Conclusion...................................................................................................................................................8
References...................................................................................................................................................9

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Introduction
Nando’s Restaurant chain is a casual dining restaurant chain of restaurants holding in South
Africa. The company operates around 1000 restaurants in 30 countries. The Nando’s restaurant is
famous for its grilled chicken dishes with various peri-peri marindes. The company is five
continents world-wide. There is centralized management system within the organization which
initiates same procedure of working in all the outlets of the Nando’s restaurant. Also the
company is known for its human resource management system within the internal system. As the
mission of the company states that, they know the importance of the growth of an individual,
thus the company aims to invest in the development of an individual. Also the company initiates
to professionally manage both people and property efficiently (Walker 2016). Due to increasing
satisfaction level of the customers along with employees the company s growing efficiently.
Further the reward management program in Nando’s restaurant is discussed below:
Factors affecting Rewards and reward strategy in the Nando’s restaurant
Rewards provided in the organization are both monetary and non-monetary incentives. Rewards
are provided in the organization to motivate them and to increase the organizational efficiency.
Further there are two types of factors affecting rewards in an organization are internal and
external. Further the factors affecting the reward in the Nando’s restaurant are discussed below:
 Internal Factors: these are the factors which affects the pay of the company which are as
follows:
o Pay scale: as the restaurant is a high profile restraint having many franchises as
well, this shows that the company provides an optimum level of pay to their

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employees. Through this they retain their employees and get competitive edge in
the market as well (Armstrong, and Taylor 2014).
o Business Strategy: this factor has high influence on the employees compensation
as according to the strategy of the business only the company will hire employees
an pay them. The Nando’s restaurant wants to maintain their customer base in the
market resulting to which, the company offers more pay along with other benefits
to their employees.
o Appraisals and job evaluation: appraisals help the employees to gain extra
benefit through their hard work. The company acknowledges the employees who
work efficiently. Evaluation process in the organization helps in the process of
differential job pay (Shields, et. al., 2015).
o Workforce: the employees themselves also influence the reward management n
the organization. In the Nando’s organization, the employees who have the
potential and prove it through their work get better rewards.
 External factors: it refers to the factors affecting the rewards in organization but exits
outside the organization, they are as follows:
o Labor Market: the demand and supply of labor influences the pay scale of the
employees in the industry and organization. The labor market of the restaurants in
Qatar believes in fluctuation and shifting their organization thus the company
needs to give employees high wage rate. This will make them satisfied in their
current job only (Bratton, and Gold 2012).
o Prevailing market rates: the wage rate of every company depends upon the
prevailing in the market. This states that if the wage rate in the industry is high

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then the workers will be paid more. Also another factor affecting the wage rate of
the workers is the amount other competitor firm giving for the same work. In the
Nando’s restaurant the company gains the competitive edge because they always
aims to keep their employees and customers satisfied with their services. Also the
company has goodwill in the market which is created by the stiffed employees
only.
o Productivity: the rewards of the employee increases with the increase in the
productivity which they give. Stating to that the employee who works with their
full efficiency will earn more. Also the Nando’s organization constantly aims to
increase the income of the employees by innovative various technologies to
enhance the efficiencies of the employees. The employees of the company help
them to gain the competitive edge in the market (Budhwar, and Debrah 2013).
o Cost of living: it also affects the wag rate of the company. Gain or fall in the
consumer price index affects the salary bars accordingly. In Qatar there is low
CPI due to which the employees earn comparatively low.
o Law relating to rewards and wages: the government laws relating to the wages
of employees and incentives are determined by the government. These laws shall
be complied by every organization falling in the list. The company provides
rewards to their employees on the basis of the limit determined by comply all the
regulations (Morrisson, and Huppertz 2010).
Factors driving the reward strategy
Reward strategy refers to the strategy which defines the way in which the company is going to
provide rewards in the organization; along with the reward policies and procedures as well.

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Rewards help the business in better optimization of human resources (Wheelen, and Hunger
2017).
In the Nando’s organization the rewards strategy is derived by the pay scale, benefit plans and
recognition of employees. The strategy states that the pay scale of employee shall firstly satisfy
them to bear their personal expenses. Also the strategy is driven by benefit plan optimized by the
company to motivate the employees. It depends upon the employees and work they perform on
the basis of which benefits are provided to them. Lastly the strategy aims to provide employees
appraisal on the basis on their performance, also it aims to recognize the efficiency work
provided by the employees. Also this strategy is implemented by all the outlets of the company
(Armstrong 2010).
Sources of Reward Intelligence
A reward in an organization includes five different sources. Each of them includes different
programs, strategies which collectively attracts the employees and retain them. Further the
elements are discussed below:
 Compensation: the compensation aspect of the reward intelligence states that the
employees shall get the pay on the basis of kind of work they perform. Also the pay shall
include both fixed and variable factors. This will initiate that the employees will always
get a fixed sum of money irrespective of the tasks they perform. Thus the compensation
process in the organization is formed in such a way that it incentivizes both the
employees and the organization as well. The Nando’s organization uses this factor of the
reward intelligence process in such a way that the employees of the company always get
satisfied with the pay. Along with the variable factor includes incentives which initiate

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the employees to work hard and earn the extra sum of money. The company does not
believe in deducting the fixed pay of the employees, because with that the employees
demotivate themselves; which will instantly affect the growth. This is another reason the
company has segregate the pay into fixed and variable sum. The deductions are always
made from the variable part of the income of an employee (Kwenin, Muathe, and Nzulwa
2013).
 Benefits: benefits refer to the extra sum of money which the employees of the company
receive. These benefits are provided by the company in order to motivate the employees
and keep their interest I the business only. The process of benefits helps the company in
increasing the efficiency of the employee and thus resulting in increase in the growth of
the company. The Nando’s company provides benefits to the employees’ of the company
in such a way that they instantly support the company to increase sales. Like the company
provide incentives to the employees who serve more and more customers yearly. So for
that purpose the employees need to work on their skills and give company more and more
profit by increasing sales so that the company provides them incentives in return (Lin
2007).
 Work-Life: the work life balance refers o the procedure and policies used by the
organization to make sure that the employees attain success in their both professional as
well as personal lives respectively. This is one of a major aspect which every company
shall consider while deciding the pay of the employees. The Nando’s organization uses
the code of procedures defined under this strategy to provide the employees satisfaction
in their jobs. Also this process also helps the employees’ job satisfaction. The company

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constantly aims to provide services to the employees of the company as they expected
while joining the job (McCall, and Voorhees 2010).
 Performance and Recognition: performance in the process of reward management
refers to the process of analyzing the efforts an employee put in the business to initiate
the growth of the company. Whereas recognition refers to the process of the organization
under which the organization recognizes the work done of the employees of the company.
The working of performance and appraisal goes hand in hand. The performance is
examined with the expectation and the outcome of that activity with continuous feedback.
And the recognition in an organization relates to the process of meeting the intrinsic
psychological needs of the employees against their performance.
 Career option and development: in the process of reward intelligence development
refers to the process of learning which an employee receives to enhance their skills. Also
the career opportunity in the strategy refers to the recognition and the growth process of
the employee (Van Veen-Dirks 2010). Like, in the case of Nando’s organization the
company used this process of reward intelligence in gaining benefit for the company. The
company initiated the employee’s development program to make the employees efficient
so that they increase the efficiency of the company as well. This process and strategies
helps the employees and company as well in adding value in the organization process.
Thus with the above statement is can be seen that the company takes care of the satisfaction of
the employees and they want to employee more and more employees with the strategy to retain
them in their business. They do not focus on exploiting the interest of the employees instead they
focus on growing together so that both the company long with employee achieves growth
(Harms, and Credé, 2010).

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Perspectives of reward decision
There are many factors which affect the reward decision making process in an organization.
Further the factors which affect the rewards decisions of the organization are discussed below:
 Efficiency wage and agency: it refers to the amount of wages provided to the employees
is optimum according to the requirements of the employees. Also the wages of the
employees depends upon the agency functions through which they are hired. The
Nando’s organization initiates the reward decision after concerning all the issue related to
the employee and wages (Dewaelheyns, and Van Hulle 2010).
 Collective bargaining: it refers to the process f management under which the employer
and the employees of the company collectively discuss and bargain the monetary benefits
received to them. it gives benefits to the employees as if one employees is unable to stand
up for the difficulties faced by them, in that case the whole union helps the employees to
stand up for their right support them. In such a way the work place issues of the employee
are solved easily. In the Nando’s organization, the company focuses on the issues faced
by the workforce, also they initiates discussion with the union in order to solve the issue
and increase efficiency of the organization (Williams, and Williams 2010).
 Competitiveness: competitiveness refers to the advantage of the firm with the help of
which it gain benefit in market against its competitors. The competitiveness helps the
company to achieve success and attain market capitalization, but for that purpose the
company needs to initiate differentiation in their product or services. The Nando’s
organization enjoys the competitive advantage due to thee they service to its customer.
The company gained goodwill in the market to which every employee is attracted to go

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their restaurant only. Resulting to which the sale of the company is increased initiating
competitiveness for the organization.
 Human capital: it is also one of the features which inform the reward decision in an
organization. The more human capital employed in an organization initiate is distribution
income more comparatively. Thus, the employees get low income in hand due to low
fund for salary and more employees sharing the income fund (Hernández-Orallo et. al.,
2011). So in order to satisfy the employees the company needs to increase the pay of the
employees.
The Nando’s organization being one of the renowned firm in providing services to the
employees. Also the company is placed on a large scale basis resulting to which there
numerous employees are working in the organization. For that purpose the company has
also increased the salary fund to pay to the employees of the organization (Arel 2012).
Advantages of internal and external equity
An efficient reward system shall always motivate the employees and provide them sufficient
labor cost concerning the policies of the company. Internal equity in the system refers to the
process of ensuring the employee that they receive same pay as the other employee receives
working under same job profile. Some of the advantages of the internal equity are as follows:
 Fairness: internal equity is one of the process through which fairness in the organization
s maintained. If an employee compares their job description with other similar job under
which the employee is getting more pay, in that case the employee will get unsatisfied
with the organization and spread negativity in the culture of the organization (Osawa
2014).

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 Reduction in discrimination: the process of internal equity initiates flow of
transparency within the organization. Also the company is relieved from various lawsuits
as well. Same work with differential pay negatively influences the employees initiating
them to protest against the system. Thus resulting in defaming the name of organization
in the market.
 Consistent standards: by keeping the employees at the scale will help the organization
in receiving consistent work and along with which every employee will try to compete
with its peers and reach one step above them. The process of internal equity in the
organization initiates flow of work along with positive competition in the organization.
 Team structure: the process of internal equity leads maintenance of team structure in the
organization. Equitable compensation protects against a natural barrier that can impede
cohesiveness in a work team. People having same reward statement usually collaborate
and work to form a team (Armstrong, Brown, and Reilly 2011).
Further external equity in organization system refers to the process of comparison of employees
reward and compensation with the employees of other competitive firms. By far it is seen that
the Nando’s organization provide the best services to the employees in term of financial and non-
financial services. Further the advantages of external equity are explained blow:
 Compensation: it is one the most basic requirement of the employee every employee of
the company wish to get the same or more pay as the other employee is getting for the
same job profile. So if the employees of in organization receive satisfaction in case of
compensation, then they will get motivated towards their goal and will in initiate
effectiveness in their working (Fatt, Khin, and Heng 2010).

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 Benefits: there are two types of benefits, mainly financial and non-financial, if an
employee of the organization receives adequate amount of benefits to motivate
themselves then the company will subsequently increase its efficiency. As the satisfaction
of employee increase then they will aim to provide better services to the company
resulting in growth of the organization.
Conflicts in the organization due to reward decision
Conflicts in the reward management system of an organization may arise due to dissatisfaction
among the employees due to the reward decision made by the management of the company. For
instance, it is known that an organization structure shall be transparent so that clashes in the
organizational process are reduced. But if the process of transparency is reduced in the working
of organization then the company might attract difficulties in the management (Griffin, and
Moorhead 2011).
Decisions of HR affect the management system of the organization. Like, conflict and a sense of
dissatisfaction among employees may arise, if the HR keeps the distribution of rewards to the
employees opaque. In this way the employees might get curious regarding the distribution of pay
and benefits. They might feel that they are paid less if compared with their effort and the other
person is pad more with giving enough efforts.
This will corrupt the organizational structure and initiate flow of negativity and fights in the
organizations. Conflicts will adversely affect the image of the organization in the external market
and can also affect the growth of the company in monetary term. Opacity in the organization
may demotivate the employees leading them to quit their job as well (Bobillo, López-Iturriaga,
and Tejerina-Gaite 2010). The decision of the HR in the reward management system majorly

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affects the activities of the employees in an organization. As it is known that the employees are
the most important source of the management and they only initiate efficiency in the
organization. So, if the most important asset of the company is not satisfied with the internal
process of the company and the company cannot achieve the target efficiently. Rewards are the
most important aspect which motivates or demotivates the employee in an organization, so the
company shall always initiate transparency and truthfulness in an organization to reduce
dissatisfaction and conflicts in the organization. For an organization to become effective the
management needs to strategically provide benefits to the employees according to their
performance, they shall not create biasness in the organization. Thus, effective management will
initiate effective in an organization resulting in growth of the company (King, and Grace 2010).
Conclusion
Concluding the above statement it can be assumed that reward management lays an important
role in working of an organization along with which the also need to take care of the regulation
and code of conduct of the organization and then only provide incentives to the employees. No
employee shall get dissatisfied with the activities of the company, also the company and
management shall always aim to reduce the convicts in the organization through their decision
making process. So there are many factors both external and internal which affects the reward
decision of an organization. The company shall consider all the factors while providing rewards
to the organization.

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