Objectives and Overview of Reward Systems

A reward is regarded as something that is given to an individual in return for some good service, behavior or attainment. Recognition is regarded as an acknowledgement or special notice and attention. In several organizations, recognition and reward programs act as a motivator, which enhances an employee’s performance level. The reward programs should affect the behavior measurably, enhance or improve results as well as deliver tangible and intangible awards, which everybody can enjoy and earn. The human resource managers are responsible for designing and implementing reward systems to the organizational policies in order to motivate their employees as well as staff members (Shields et al., 2015).

The aim of the report is to discuss about a company which is planning to expand their business in the international markets. Cheesy Pizza Company is planning to enter the markets of Hong Kong and Singapore by opening ten outlets in each of the locations by the year 2018. The human resource consultant of the company is required to put in place the reward systems, to ensure that the management teams and employees are appropriately motivated and rewarded. A good reward as well as recognition can be regarded as a “pulling” strategy, which pulls people to give their best performance (Wachs, 2017).

The report throws light on the objectives of the reward systems and the comprehensive overview of the factors, Cheesy Pizza should keep under consideration, while designing and implementing the reward system. Employees must be motivated by giving them rewards based on their achievements. They should feel good about what they are receiving and a positive attitude of the employees yield better outcomes for the company. In order to fully integrate the culture of this sort, employees need to be patient as well as consistent with their performance. In simpler words, right rewards given to the right employees along with right reasons will give the right results (Pearce & Robinson, 2013).

Employee recognition can help in increasing the feelings of loyalty as well as satisfaction. Every individual likes getting a nice pat on their back, mainly at workplace. Cheesy Pizza Company is planning to expand their business into the markets of Singapore and Hong Kong. The human resource consultant of the company is responsible for presenting an overview to the senior consultant regarding the designing and implementation of the reward and recognition plans.

The human resource manager of the company is responsible for the overall planning and designing of the reward structure. In addition to a pay rise or bonus, the consultant should consider creating a system that will help in recognizing the strong employees’ achievement and performance, through praise and recognition. The managers should create a motivating environment, in order to keep up the level of performances (Nickson, 2013). This section of the report consists of the reward systems’ objectives and the need for designing an appropriate system for the employees.

Employee Recognition and Loyalty

On designing a performance reward system, it is important for the human resource consultant of the company to create a proper list of the employees’ performance expectations for the company. Performance expectations include contracts with the clients, certifications, trainings, paper works, contributing new and innovative ideas and others. Reviewing the employee performances will help the human resource manager to create and set clear goals for discussing the annual employee evaluations. Moreover, an employee survey can be conducted in order to identify the instances where the employees have exceeded their performance levels. Monitoring the facts will help in keeping a track of their productivity (Mišanková & Ko?išová, 2014).

In addition to this, the human resource consultant should also determine the reward types to be offered to the employees. It may include a pay raise, bonus, annual office parties, achievement certificate, promotions and others. The company can also honor the employees by giving cards or letters of appreciation for their hard work or dedication. This may also include letters from the management teams or congratulatory emails and more. Furthermore, the company can also create employee enrichment programs which will provide art classes, seminars, yoga instructions and others. Enrichment programs will give the employees some sort of relief from the hectic work schedule and in turn, motivate them to work better (Marchington et al., 2016).

Reward systems highly influence the behavior, performance, job satisfactions and attitudes of the employees. It can be categorized as monetary rewards, monetary equivalent rewards and non-monetary rewards. The human resource consultant of the company should set up a guideline for designing an effective yet efficient reward system. The performance pay offs must be a major and crucial part and an important piece of the overall compensation package. The incentive plans should extend to all the employees as well as managers. In addition to this, the human resource manager should keep in mind that the reward systems are administered in an unscrupulous and fair manner. The incentives need to be linked with the performance targets in the strategic plans (Manzoor, 2012).

Organizational leader’s efforts to motivate the employees includes, recognizing the staff members’ achievements. This proves to be beneficial for an organizational development and have given rise to various methods of rewards and recognitions. The human resource manager of the company must have a proper toolkit, which will help in examining the recognition programs and a brief description of those programs. In addition to this, the toolkit must include a clear discussion of the business cases responsible for such programs. Furthermore, the toolkit discusses about the human resource manager’s role of overseeing such programs. The policies and designs helps in building the foundation of the program (Lee et al., 2014).

Designing a Performance Reward System

A major part of this toolkit helps in exploring the critical elements necessary for a highly successful recognition program. It starts from funding as well as value alignment and extends to appropriateness, evaluation and means of delivery. In addition to this, the toolkit also provides a brief guidance on the management training, communication methods and tax implications. In order to show appreciation, the management team should conduct various types of motivational programs like social gatherings and events. Rewards and recognitions act as a catalyst which helps in improving the performances and enhances productivity. Rewards generally improve the productivity by thirty to forty percent, which is twice as much as that of goal settings and job redesigning (Kohtamäki et al., 2012).

Furthermore, it helps in linking to the business goals and strategic directions. The employees actively engage themselves in the activities of the organization. It helps them in renewing the overall business community’s sense as well as the mission of the organization. Therefore, Cheesy Pizza Company can rely on these methods of rewarding their employees and staff members in order to increase the frequency of the employees’ actions. In addition to this, the rewards and recognitions will increase the chances of performance repetitions. It also helps in creating a more pleasant workplace environment. Many organizations use reward system to manage the employees’ behaviors and attitudes (Kirchmer, 2012).

The Cheesy Pizza Company can effectively design as well as manage the reward systems in order to drive an organizational change process. This can be done efficiently by positively reinforcing the desired behaviors. With the implementation of reward systems, the staff members and employees will feel acknowledged for their contributions, accomplishments as well as performances. However, the company should motivate and encourage the staff members continuously in order to strive for excellence. The reward and recognition systems act as a motivator for influencing individual behavior and attitude. Several researches on this topic have revealed the fact that the reward systems can directly or indirectly affect the career choice, turnover rate and job choice of the company (Kimball & Kim, 2013).

Organizations which give the highest amount of rewards and recognitions tend to attract more and more employees. It also has the power of retaining the employees and contributes to their satisfaction level. The higher their satisfaction level is; the longer is the length of service. Moreover, rewards also have the power of reducing the turnover rate of the organizations. The Cheesy Pizza Company needs to retain the employees’ performances and remove the inefficient ones. To maintain the level of the top performers, Cheesy Pizza Company can introduce new forms of rewarding the employees. Their current reward systems are to be compared with those of other organizations’. The company needs to ensure that their reward systems are superior to their competitors (Hendry, 2012).

Types of Rewards to Be Offered

However, it can be a bit costly for the company to maintain a reward system. This can increase the costs of labor of the organization. In most of the organizations, labor costs cover almost fifty percent of the company’s capital and overall operational costs. In addition to this, if all the staff members of the company are rewarded at the same level, there will be no competition between the staff members, which will act as a de-motivating factor. Therefore, the company needs to keep certain factors while rewarding the employees. This must strictly be done on the basis of their performances and productivity levels. There should be no discrimination or biasness, at the time of reward selection. The employees must not feel that the management’s decision is unjustified. This can discourage them to a huge extent (Goetsch & Davis, 2014).

It is to be kept in mind that rewards act as a motivator and not a de-motivator. The Cheesy Pizza Company needs to keep in mind that their initiatives of rewarding the staff members must not go in vein. Their activities must act as a motivator for the staff members and enhance their productivity level to a huge extent. In addition to this, the company needs to keep an eye on the behaviors and attitudes of the employees. This will help them in getting a clear idea of what the employees expect from the organization. In this way, the company can segregate their methods of rewarding each and every employee. For instance; some employees love getting bonus or a raise in their salary, some wishes to get promoted to a higher position. Most of the companies encourage their staff members to think in a positive manner and believe in themselves (George, 2012).

Moreover, the Cheesy Pizza Company must create a positive culture inside the organization. The organizational culture affects an employee’s way of working in a huge way. Depending on the reward systems’ method the organizational culture must be developed, managed and administered to a huge extent. For instance; the reward systems can highly influence the human resource management’s culture, innovative culture, entrepreneurial culture, participative culture, fair culture, competence based culture and others. The company can adopt such methods which will highly affect the motivation, satisfaction and communication efforts of the employees. For instance; if the employees are hard working, it can highly affect the organizational progress and lead to its success. However, if the company is rewarding all the staff members equally, without any individual appreciation, most of the staff members will slack (Doyle & Locke, 2014).

Managing Reward Systems

The established culture of the Cheesy Pizza Company must be able to meet all the standards of the organization. The staff members and the employees must have a positive environment of working, which will yield better outcomes. The organizational leaders believe that only reward systems are attractive enough to improve the productivity levels of the workers. However, Cheesy Pizza Company needs to gain an understanding of the needs and requirements of the employees. Moreover, the company must motivate the employees to achieve a certain limit of target, on the basis of their competency levels. The Cheesy Pizza Company must encourage their workers to think in a positive way as well as set achievable targets. For instance; the monthly sales quota of the Cheesy Pizza Company must be reasonable and different for each and every individual, in accordance with their competency levels (Davidson & Stevens, 2012).

Reward systems always help an organization to encourage their employees and improve the skill sets. The Cheesy Pizza Company should pay the employees on the basis of their skill sets and levels. The staff members can be motivated and encouraged to attend extra classes for improving their customer handling abilities, for gaining more benefits from the organization. In addition to this, the company itself can organize several seminars and training sessions, where the certified trainers can train them or give important lessons on client and customer handling, public relations activities, servicing skills and other relevant courses. The company should also provide the employees with regular trainings for around twenty to thirty minutes for developing their communication and customer servicing skills (Chun et al., 2013).

The Cheesy Pizza Company must consider certain factors while designing and implementing a proper reward system for its Hong Kong and Singapore operation. The company first needs to analyze whether their current policies and procedures are ready for reward implementation processes. In accordance with that, the company should be able to gain an understanding of the agency’s attitudes towards the reward and recognition systems. It is immensely necessary to measure the existing patterns of reward system. In addition to this, the Cheesy Pizza Company must be able to determine the gaps between the current as well as desired patterns. Identifying the personal reward patterns of the agency leaders also play a vital role in the company’s success (Brewster & Hegewisch, 2017). However, the Cheesy Pizza Company must carry out the above steps with utmost care, keeping in mind the competency level of the staff members.

Costs and Issues Associated with Reward Systems

Figure: Establishing a reward and recognition system

(Source: Created by Author)

The first step in designing a proper reward system includes establishing the foundation for the organization. Once the reward and recognition processes have been established in a proper manner and the existing patterns are assessed, the Cheesy Pizza Company can easily move to determine how such processes can be implemented. The company needs to set a few goals in this aspect. It includes determining the focus of the whole process. Identification of various facets can also help in proceeding with the process. In addition to this, identification of the processes can be measured in order to determine the success of the organization (Bratton & Gold, 2012).

The second step includes selecting a champion for the organization, in order to ensure that the whole process has a requisite support from the higher organizational levels. A champion is supposed to keep a track of the whole procedure, which will exemplify the recognition based behaviors and attitudes, which the agency demands. The organizational champion is present to ensure that the support systems are adequate and minimize the obstacles. The senior management of Cheesy Pizza Company should also take proper care of the procedures as well as policies. The company should have a proper goal of identifying someone who will be able to effectively lead the whole process (Boussebaa, 2015).

At stage three, the organization is supposed to develop a parameter of the whole procedure. This will help in determining the importance of the management and ensure that the whole procedure match the needs as well as expectations of the employees. In step four, the design team should properly assemble the specific factors of the procedure. The organizational champion can lead the design team or actively monitor their performances. The aims and goals include deciding on what the reward processes may look like, determine the needs to be included in the whole procedure and how they are to be provided as well as accessed (Beardwell & Thompson, 2014).

The next step is piloting or introducing the whole procedure. The pilot program helps in designing the whole procedure by making some major modifications into the system. The goals include; allowing time for the people to gain an understanding of the procedures, test as well as evaluate the processes by learning what actually works and what does not. The sixth step is preparing for the rollout. Employees and managers need to get educated regarding the operating programs and the innovative or creative ways of thinking about effectiveness of the reward and recognition programs. Furthermore, the goals must include ensuring that everyone is well aware of the recognition processes (Barrick et al., 2015).

Conclusion

The seventh step includes the planning processes which must keep into account the resource allocation budgets for the rewards procedure. An administrative procedure can be established in this context. However, in order to establish a proper recognition and reward system, the Cheesy Pizza Company must be able to set a proper budget for the whole procedure. The next step includes proper evaluation and planning for the improvement in the processes. However, the conditions and individual preferences change over time. Thus, the Cheesy Pizza Company can develop a proper evaluation mechanism for the procedures (Williams, 2013). It also helps in providing huge opportunities for the potential changes, which can be identified as well as implemented. The last step includes providing ongoing support to the organizational members. Keeping the whole process meaningful as well as fresh for the employees is a big challenge. Maintaining the processes plays an important role as it helps in creating an approach which will remind the people about the reward programs (Armstrong & Taylor, 2014).

Conclusion

To conclude, applying reward system and providing the employees with financial benefits or showing recognition can prove beneficial for the Cheesy Pizza Company. This will also improve the employees’ satisfaction at work. On the basis of the employees’ needs and requirements, the company should design their reward systems, in order to maximize the productivity level. If the company starts rewarding their employees, the staffs will show a desire to improve their performance, for getting recognized. By rewarding the staffs on the basis of their performances, the junior employees will get motivated to perform better and show their abilities to the company. This will create a positive working environment within the Cheesy Pizza Company. In addition to this, the staff members must have a clear understanding of their targets as well as the expectations of the company. Therefore, Cheesy Pizza Company must have a clear reward system in order to motivate and encourage their employees for improving their performance level.

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