Evaluating the Impact of Reward Systems on Organizational Performance

The assignment examines the significance of well-structured reward systems in business management by analyzing their impact on employee performance and organizational success. Drawing from sources such as van Duijvenvoorde et al. (2014) and Barto (2013), it discusses how intrinsic motivation and reinforcement learning contribute to improved work outcomes. The essay further reviews theoretical frameworks explaining behavior maintenance, referencing studies like Kwasnicka et al. (2016). Additionally, the analysis includes a case study on 'How a Proper Performance Related Reward System Can Contribute to Work Performance Excellence' by Hamukwaya & Yazdanifard (2014), demonstrating practical applications in human resource management.

Running head: HUMAN RESOURCE MANAGEMENT
Human Resource Management
Name of the Student:
Student ID:
Author Note:

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Table of Contents
Introduction................................................................................................................................3
1. Present an overview to senior management on the objectives of reward system and why it
should pay careful attention to the design of the reward system...............................................3
1a) To attract and retain suitable employees..........................................................................3
1b) To influence culture.........................................................................................................4
1c) To motivate employees to meet their job objectives........................................................4
1d) Reward employees according to their contributions/values they created........................4
1e) To reinforce and define the structure...............................................................................5
2. Design factors.........................................................................................................................5
2a) Market position-recommend what is the market position................................................5
2b) internal and external equity..............................................................................................6
2C) Cost effectiveness............................................................................................................6
2e) Basis for rewards..............................................................................................................7
3. Designing reward system.......................................................................................................8
3a) Type of payment system..................................................................................................8
3b) Equity...............................................................................................................................9
3c) Pay structure.....................................................................................................................9
3d) Extrinsic.........................................................................................................................11
3e) Intrinsic..........................................................................................................................11
3f) Total reward- financial and non-financial......................................................................12
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4. Implementing- how to implement a successful reward system?..........................................12
4a) Communication..............................................................................................................12
4b) Training of line managers..............................................................................................13
4c) Gathering feedback from employees.............................................................................13
4d) Obtain approval from CEO and senior management.....................................................14
5. Recommendations and Conclusion......................................................................................15
References................................................................................................................................16
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Introduction
A well-known organization named Cheesy Pizza is preparing to expand its business
operations in Singapore in 2018. I have been hired as a Human Resource (HR) consultant
within the organization. The major significant role of an HR is to ensure the activities of the
employees and analyse the area of expertise within any firm (Hamukwaya and Yazdanifard,
2014). An adequate HR should have the ability to proficiency in the development of the
employees as well as the skill to provide proper training, recruiting, provide safety, benefits
and construct well relationship with the employees.
To expand a business in another country, several factors are needed to be adopted to
successfully run the organization. Accordingly, a huge amount of financial investment also
required. On the other hand, competition with other organizations of that country is one of the
major barriers that should need to be looked after very carefully and thus, to get competitive
advantage, the organization should adopt various adequate strategies such as good quality of
the product with reasonable price and quantity (Pinheiro and Schneider, 2017). On the other
hand, the organization should recruit skilful employees as well as an accountant and other co-
workers. To encourage the employees, the organization should provide incentives or rewards
regarding their jobs. In that case, the workforce can be increased within the organization,
which also helps to generate the productivity of the organization.
1. Present an overview to senior management on the objectives of reward system and
why it should pay careful attention to the design of the reward system
1a) To attract and retain suitable employees
A reward can be defined as a system to pay the employees for their performance within the
organization. There are various reasons to commence reward system amid the employees.
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Reward system mainly fulfils the psychological needs of the employees and proper reward
also attaches the employees psychologically with organization and that also improves the
employee retention of the organization. Every organization wants to attract the attention of
the people through the brand name (Teoh, 2017). In that case, the role of product quality and
adequate service providing to the customers also signified as effective factors.
1b) To influence culture
All the organizations maintain their own specific cultures. Reward system also helps to
enhance the employability along with the skill and knowledge and that also needed to
preserve the overall culture of an organization. Most of the organizations pay salary to their
employees on the basis of their skill. As an example, in case an organization provides reward
to their employees for better presentation to attract the customers (Teoh, 2017). In that case,
the entire team will be motivated to apply developed skill to attract the customers to achieve
rewards.
1c) To motivate employees to meet their job objectives
Reward system can be defined as a most noteworthy approach in order to gain the ability to
performance and motivation. Every individual should be rewarded within the organizations
according to their skill and performance. On one occasion of getting a reward, an employee
would be more influenced to generate their performance and skill (Pinheiro and Schneider,
2017). For instance, in case a sells manager sells 20 unit of the organizational product, in that
case, the sells manager will get only the salary. However, the sells manager sells 25 unit of
product within a month; in that case, they can achieve 12-15% interest additionally. This kind
of reward system may influence their workability for the next time.
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1d) Reward employees according to their contributions/values they created
Reward system also a significant aspect for marinating the organizational culture and work
ethics. Reward system is the most required approach within the human resource department
of every organization (Pinheiro and Schneider, 2017). The system not only helps to improve
the work ethics and sells volume but also it helps to construct an adequate relation including
better behaviour between the organization and the employees. Employees are the most
valuable recourses within the retail system. Therefore, in order to maintain the organizational
performance, organisations need to preserve the skilful employees. Within this context, the
reward system is the most noteworthy approach to maintain the high-quality performers. On
the basis of the reward system, encouragement within the employees can be enhanced.
Accordingly, the conflict of employee turnover within the organizations can be resolved.
1e) To reinforce and define the structure
Employees are the most valuable recourses within the retail system. Therefore, in order to
maintain the organizational performance, organisations need to preserve the skilful
employees. Within this context, the reward system is the most noteworthy approach to
maintain the high-quality performers. At the same time, increase of employee performance of
also strengthens the structure of this organization. The support of employees also provides
different competitive advantages to this organization.
2. Design factors
2a) Market position-recommend what is the market position
The operating market of Singapore is highly developed and the economic performance of the
country is innovative and competitive. In case of food and beverages, the overall market
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trends are positive in Singapore. Competitions between rival companies are increasing with
demand. The social and lifestyle of the people are continuously developing (Zuckerman,
2014). In that case, the reward system amid the employees will effectively help to gain
competitive advantage of the organization. in that case, some of the effective strategies con
be adopted within the organization regarding the reward system.
2b) internal and external equity
Workplace equity is essential for the organization to treats he employees fairly. Cheesy pizza
also provides internal equity to its employees on the basis of employee’s job ranking. At the
same time Human resource managers will measure the skill and performance of individual
employees and will create a point system. The reward will be provided on the basis of their
scores.
On the other hand, external equity of an organization mainly depends on the pay rates. At the
same time the external equity depends on organizational fairness. If the pay rates of cheesy
pizza are equal to the averages rates then company will provide the employees much more
than their base pay. Huge number of employees of the organization mainly considers external
equity more than their base pay. This type of compensation benefits to the employees also
helps organization to maintain the work environment in proficient manner.
2C) Cost effectiveness
The major conscientiousness of a senior manager within an organization is to enhance the
organizational performance with the help of adequate budget planning along with appropriate
strategy in order to bring evaluation within the work place. In that case, reward system can be
described as one of the adequate strategy that helps to generate the organizational
performance with the help of proper employees and adequate skills (Leaf et al., 2016). The
management of every organization should be accomplished for provide reward to the
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employees. As it is seen, every organization shows advanced commitment for strengthening
of reward system in the present days (Griffith College, 2017). It is needed to enhance the
motivation of the employees in order to bring effective positive changes within the
organization. In that case, the employees should be rewarded within the organization.
2e) Basis for rewards
In order to generate motivation and commitment amid the employees, HR department of
every organization has developed HR policies and regulations with an intention of ensuring
better productivity and profitability within the organizations. On the other hand, the HR
policies and regulations also have positive impact on the skill and improvement of the
employees (Nevin et al., 2016). Accordingly, the entire workforces are needed to be provided
equivalent respect, which helps to maintain an adequate working atmosphere for the
employees within the organizations. Alternately, an organization can be resolved the
employee turnover by providing rewards amid the employees.
All the employers of every organization are needed to build an adequate relationship with the
employees. Within this context, reward system is the most effective phase that helps to
maintain the organizational relationship with the employees (Leaf et al., 2016). On the other
hand, every organization should adopt adequate strategic planning in order to generate
motivation and satisfaction regarding their jobs within the organizations. On the basis of that
two types of reward system can be adopted such as enlargement of salary and outsized
incentives.
The reward system will also play a noteworthy role for Cheesy Pizza during expansion of the
organization in Singapore. In order to encourage the employees within the organization,
Cheesy Pizza should be prepared to provide rewards to the employees (Liu et al., 2014). To
operate the organization within the operating market of Singapore, the organization needs
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better service from the employees and thus, the reward system will be effective to encourage
a large number of employees in order to generate the organizational performances (Nevin et
al., 2016). On the basis of that, Cheesy Pizza can adopt several strategies regarding reward
system. Those are described below:
3. Designing reward system
3a) Type of payment system
Organization Performance Based Incentive plans
All the mentioned plans help to enhance the expectations of the employee regarding their jobs
within the organizations as well as effective for the organizational productivity and
profitability. Accordingly, all the plans are also effective for ensuring organizational loyalty
amid the employees (Kwasnicka et al., 2016). Cheesy pizza will also use the different
incentive plans based on the performance of employees and human resource managers of this
organization will measure the performance of individual employees to enhance the overall
performance of this organization. On the other hand, these types of reward system help to
maintain competitive advantage in the same operating market with other organizations. Most
of the group incentive plans are adopted within the food and beverage companies. On the
basis of the reward system, organizations can choose skilful and experienced employees for
better outcome of the organizations. In that case, Cheesy Pizza can adopt several group
incentive plans (Leaf et al., 2016). The policy of reward can be divided into two different
classes such as tangible and intangible. The tangible process of rewarding the employees can
be mentioned as being a massive number of rewards are granted for the employees. In
tangible process can be defined as public virtue for which the employees can be rewarded
(Zuckerman, 2014). Every organization should maintain several policies in order to make the
employees encourage regarding their job roles within the organization. On the other hand,
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there are several internal and external reward system can be seen within an organization,
which affects the organizational performances.
3b) Equity
The management of Cheesy pizza will recruit the experienced employees to increase overall
performance of the organization. Based on performance of individual employees and overall
sales performance of the organization the company will provide the employees proper
compensation to motivate them to increase their performance. Company also pay percentages
from the net sales amount. That also helps to increase the sales volume as well as profitability
of this organization. Company will design the plan on the basis of the official work of the
employees within an organization such as protection, attendance, production as well as
customer satisfaction (Kwasnicka et al., 2016). These kinds of organizational performances
are measured as the organizational objectives, which are needed to be fulfilled to ensure the
growth of the organization. Cheesy Pizza can also adopt this kind of incentive plans to
encourage the employees.
3c) Pay structure
Job evaluation refers to the systemic process for recognising the relative worth of a particular
job position of an organization. Company also select the position depend on different criteria
such as skill and requirements of the job, proper knowledge, job responsibilities and other
different factors. In case of reward payment Cheesy pizza will follow different structures or
design. The structures are described below-
Halsey Premium Plan: The plan was designed by an American engineer F.A Halsey. The
plan was designed on the basis of the experience and time. According to the plan, employees
can be rewarded on the basis of the experience (Nevin et al., 2016). On the other hand, if an
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individual can do the work within less time, the employee will be awarded 50% additional
money.
Rowan Premium Plan: The following plan was designed by D. Rowan, which was a
developed plan of Halsey Premium Plan. According to the previous plan, the rewarded
amount was fixed for the employees, but according to the Rowan Premium Plan, the amount
of the reward is based on the time that can be saved by the employees (Leaf et al., 2016).
Emerson Efficiency Plan: The plan displays that the amount of daily wage is fixed. Reward
can be paid on the basis of the work efficiency of the employees. According to this plan, the
rate of the bonus for each quantity is 1% as well as basic rate of bonus for quality is 1%
(Kwasnicka et al., 2016). The rate of the bonus is needed to be increased until the employees
can accomplish 100% efficiency.
Gantt Task and Bonus Plan: The stated plan was premeditated by H.L. Gantt. It is one of the
effective group incentive plans, which is must require to be implemented within every
organizations (Hamukwaya and Yazdanifard, 2014). On the basis of the plan, a least amount
of wage is needed to be provided to the employees, who cannot accomplish their work within
the notified time. On the other hand, an employee, who will provide excellent effort
regarding their job role, can be rewarded 20% additional bonus along with the basis pay.
Co-partnership: This kind of strategy can also be applied in order to enhance encouragement
amid the employees within any organization. According to the policy, the employees are also
measured as shareholders of the organization. However, the policy is not applicable for all the
employees. This kind of scheme is only valid for the managers as well as the administrative
of the organization (Hamukwaya and Yazdanifard, 2014). This policy can be described as
one of the effective applications that can be applied within an organization in order to
enhance the performance of the administrators along with the managers. The policy can also
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be adopted by Cheesy Pizza for ensuring developed performance of the administrative
section.
3d) Extrinsic
Not only the basis salary but Cheesy pizza will also pay onetime bonus to the employees and
also provide yearly incentives based on their monthly performance. At the same time the
company will provide yearly holiday tour package to the employees and that general provide
the employees psychological satisfaction and proper motivation to enhance the performance.
Reward system is the most significant aspect that helps to maintain the entire performance of
the organization. In that case, the senior management of every organization should aware to
the rewarding system in order to ensure the performance of the organization along with the
skill and development of the employees (Agwu, 2013). On the other hand, to align the risk
performances of both organization and the management, reward system is needed to be
appeared into the panorama. Cheesy Pizza should adopt several strategies for developing the
employee-friendly atmosphere regarding the legal regulations on the basis of the employment
acts of Singapore.
3e) Intrinsic
Reward system also helps to construct an adequate shape of the organization as well as it
helps to bind the administrative adversities in order to make a motivated and satisfied
workforce (van Duijvenvoorde et al., 2014). On the other hand, the proper system of reward
amid the employees also helps to reduce the hindrances within any organization and provide
job satisfaction. In that case, it can be mentioned that in order to enhance organizational
productivity, every organization should provide pre-determined targets which can be
achieved by the employees to attain the reward system. Each and individual employees of
Cheesy pizza will take separate responsibilities and that generally help to improve personal
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development and skills of the employees. Furthermore, the system of rewarding amid the
employees helps to reduce the further expenditures related with the issues of workforce.
3f) Total reward- financial and non-financial
Reward system can be categorising into two major segments such as Financial reward and
Non-financial reward. In present days most of the customer prefers the financial rewards. The
cheesy pizza will provide the both financial and non-financial rewards based on the
performance. Company will provide money to the employees based on their sales volume. At
the same time, company also provide different gift coupons and tour packages to their
employees to provide more motivation to enhance their performance.
4. Implementing- how to implement a successful reward system?
4a) Communication
To implement a successful reward system it is import for the organization to maintain proper
communication with the employees. In case of performance based reward system
communication is essential to gather different information with a view to their performance.
At the same time communicating pay also help to maintain the transparency of the
organization. In order to ensure reward system for the employees, Cheesy Pizza should
consider several factors those are needed to be looked carefully by the organization. in that
case, to make the employees encourage regarding their job roles into the organization,
Cheesy Pizza should display the expectations and the organizational goal, which can be
discussed in front of the employees in order to enhance encouragement amid the employees
to generate the work ability and skills, which will be helpful for the organization productivity
and profitability as well (Agwu, 2013). The reward system should be more authentic, which
will be helpful for creating some certain purpose of the employees regarding the bonus and
promotions.
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On the basis of some relevant survey, it can be mentioned that the major aspect of reward
system is related with the viewpoint of evaluating reward procedure that is needed to be
maintained for the employee experience (van Duijvenvoorde et al., 2014). Most of the
organizations adopt the reward system within the firm on the basis of some survey in the
emerging market in order to gather information regarding the reward policy and rates. In that
case, the external reward system is identified as the major components of the reward process
(Study.com, 2017). In that case, it can be mentioned that the reward process is the major
aspect to enhance the organizational performances.
4b) Training of line managers
To train the lie manger the company also take different steps such as clearly define all the
needs of ad requirements of the organization, improve the overall communication process
between management and employees. The company will organise different skill development
program for the line managers to increase their knowledge. It is important to help the
managers to identify the needs of individual staffs. It deals with the components that are
related with the success after the adequate strategies are taken within an organization. On the
other hand, on the basis of the behavioural approach, the organization can identify the factors
that help the employee to maintain the organizational goals and achievements, which will be
affected into the organizational performances and productivity (Isaacson, 2013). In order to
provide a certain aim and objective to the employee of an organization, this approach can be
mentioned as one of the effective strategies. With the help of this proposed approach, an
organization can set organizational achievements in order to provide encouragements amid
the employees to ensure the employability (Zuckerman, 2014). In that case, the employees
can act in a better way regarding their ob roles to enhance the organizational productivity and
profitability.
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4c) Gathering feedback from employees
Cheesy pizza also gathers feedbacks from the employees with a view to their performance.
That generally helps the management to understand the approaches of each and individual
employees. At the same time, it also helps to maintain all the rules and regulation with a iew
to reward policies. The management should discuss with the employees about the
organizational goals and achievements in order to make the organizational goals crystal clear
in front of the employees. Moreover, the employers of every organization should discuss
about the decisions that are needed to be adopted for the well development of the
organization with their employees (Management Study Guide, 2017).
The system of rewarding helps to enhance the employee skill and ability regarding the
organizational performances and achievements (Barto, 2013). The employers and the
management team of the organization should provide appropriate care to the abilities and the
skills of the employees in order to ensure the employability, which will be positively helpful
to generate the organization production and profitability (Humanresourcesedu, 2017).
However, the ability and the performances of the employees can be achieved with the proper
method of encouragement. All the aspects are related with the management process of every
organization.
4d) Obtain approval from CEO and senior management
To maintain all the actions of an organization the approval of Chief executive officer is
essential for the organization. To implement these different planning in Cheesy pizza outlets
of Singapore proper approval of CEO is needed (Barto, 2013). At the same time it is
important to show all the documents regarding business plan and it is essential to understand
evaluate the expected outcome from this project. If the market is suitable and the business all
the requirements are available then the management will sanction this project.
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5. Recommendations and Conclusion
By means of evaluating the entire assignment, it has been followed that the policy of
rewarding the employees has a positive impact on the organizational productivity as well as
the profitability (Isaacson, 2013). On the other hand, in order to bring effective changes
within the organizations, employees are needed to be encouraged, which positively helps to
enhance the skill and performances ability of the employees. In that case, several systems are
needed to adopt within an organization, those are stated below:
Joint Reward System: On the basis of the joint reward system, an organization can identify,
which type of information are needed to be shared with the employees in order to achieve the
organizational goals and objectives.
Performance Appraisal: According to the system, it helps the organization to adopt the
adequate service from the employees within the organization (Isaacson, 2013). In hat case,
the role of human resource management is most significant in order to update the
employability according to the emerging market and atmosphere. It helps to enhance the
performances of the employees.
All the proposed systems of rewarding the employees will effectively help to perform Cheesy
Pizza in the operating market. On the other hand, the performances of the organization might
be enhanced with the help of proper reward system amid the employees.
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