Reward management (RMT) assessment template

Reward management practices – briefing paper

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Strategic Analysis
1.1 The context of the reward environment and the key perspectives that
inform reward decisions
It is a common practice for companies and organisations such as Baker’s Department
Store to reward their employees from time to time. The main objective of rewarding
employees is to motivate and encourage them to be committed towards the set
organisation’s objectives (Jones & Perkins, 2020). Rewards often works as incentives
which make workers want to work even harder so that their efforts can be recognized.
They can be in different forms including remuneration, bonuses, promotion and
recognition among others. Whenever an employee receives a reward, he or she gets
psyched up and this is the primary reason why organisations and companies make
sure that they reward their employees consistently.

Baker’s Department Store has been implementing a reward policy which has been in
place for several years. The store mainly rewards the employees who have done
exceptionally well in their duties. But this particular policy is prone to both internal
and external risks which can be current while others will affect the store in the future.
Using modern analysis tools it is possible to identify the factors that can affect the
company’s reward policy either now or in the future.

PESTLE analysis tool discloses the external factors such as:

Competition- This involves other similar stores giving more innovative rewards which
can lure some employees from the store.
Economic performance- The general economy can improve or get worse and this can
significantly affect the reward policy of the store.
Generation change- People from different generations have different needs and this
will require the department store to come up with better reward policies.
Technology- Better technology will require the store to put in place a reward policy
which goes in hand with the latest technologies.

The SWOT analysis tool discloses Internal factors such as:

Number of employees- The department store has been growing steadily and this
requires a policy that can accommodate the rising number of employees.

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Automation- The store is automating some of its operations which will require even
the reward policy to be adjusted.

The reward environment at Baker’s Department Store primarily involves the line
manager and the employees. The manager uses the performance report to establish the
performance of an employee over a period of time (Rose, 2018).

Reward decisions are informed by factors such as the period of time that an employee
has been working in a particular organisation (Nwaozor& Thompson, 2020). There
are employees who spend their entire careers working in the same organisation and
such employees need to be recognized in a special manner. Employees who go out of
their ways to accomplish their duties are also rewarded by the organisation.

Another aspect that informs reward decision at the department store is doing extra
ordinary things while at work (White, 2016). These are the employees who will not
hesitate to inform the relevant managers when something is not going well. They can
inform on issues such as theft or a certain form of laxity.

Employees who have shown exceptional leadership qualities are also rewarded by the
companies they work for. These are the workers who will rally and direct others
towards working even harder in their duties. It is important to reward such employees
because they can easily use their leadership qualities to negatively rally the employees
into things such as strikes and revolts (Michael, 2017).

Reward Intelligence

1.2. The most appropriate way of collecting reward intelligence

Methods of collecting reward intelligence may vary depending on the organisation
and its size. Big organisations such as Baker’s Department Store need to put in place
more elaborated methods which will cover the entire company. Because of this, it is
important to get more insight on reward intelligence.

Types of reward intelligence

Direct reward intelligence- This is the intelligence that is obtained directly from the
employees as they go on with their duties. The person collecting the intelligence is
able to directly see what the employees are doing in their workplaces.

Indirect reward intelligence- This is information collected from third parties and
documents related to different employees. The intelligence collector does not need to
see or know the employees being evaluated provided there is data and information
regarding the particular employees.

Ways of gathering and presenting reward intelligence

Feedbacks from employees

Majority of big companies such as Baker’s Department Stores have platforms where
employees can give feedbacks regarding their jobs. The employees are encouraged to
talk about almost anything and this information can be used to establish the

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employees who deserve to be rewarded. All the feedbacks are analyzed and then
presented to those responsible of selecting the rewards recipients.

Performance chats
Details regarding the performance and progress of different employees are usually
carefully recorded. These records include things such as if the employees were able to
achieve their periodic targets. Through these records, it is easy to identify the
employees who have achieved their goals and those who have been improving.

Personal Records
Each and every employee is required to present his or her resume while applying for a
job at the department store. The company keeps these resumes and they provide
helpful information while deciding the person to be rewarded. This is especially
applicable when dealing with rewards such as promotions because it easy to tell the
qualifications of different employees.

Use of reward intelligence in making reward decisions

The reward intelligence collected is used to determine the employees who deserve to
be rewarded. It provides even personal details about each and every employee and this
helps in coming up with the final list of recipients. Without the intelligence, it would
be practically impossible to know the deserving recipients especially in situations
where there are many employees who have qualified to be rewarded.

Total Reward

2.1 Evaluation of the principle of total rewards and its importance to reward

strategy

The principle of total rewards requires the employer to use all the tools at his or her
disposal to motivate, attract and retain employees (Jones & Perkins, 2020).The
employees do not necessarily have to do anything special or exceptional, but they are
rewarded just for working in the particular organisation. This principle is made up of
five elements which are; benefits, compensation, recognition, professional
development and work-life balance.

Baker’s Department Store can benefit a lot from a total reward approach considering
the number of people it has employed. The top priorities of the company’s reward
policy include motivating the employees, reducing employees’ turnover and creating
harmony in the workplace. These priorities perfectly fit into the total reward policy
since the policy touches each and every employee working at the store.

One of the things that the department store can expect after applying total reward
approach is employees working with more harmony. When this particular approach is
applied, the employees feel equal to each other depending on their rank in the
company. This improves relations among the employee consequently making them
enjoy working for the company. With total reward approach, there will also be
improved productivity considering that all the employees will be motivated.
Employees will not even mind working overtime since they will take the success of
the company as their personal success.

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While implementing total reward approach, the department store should consider the
cost. It is not logical for the store to spend more than it can afford in the
implementation of the policy. Timing should also be done properly where the
rewarding should be done when the employees can appreciate the rewards more.
Furthermore, the department store should consider the kind of rewards to be given to
the employees. There are certain rewards that are easier to give out and they can even
be given to teams instead of individuals.

2.3 How policy initiatives and practices can be implemented

Reward policy initiatives and practices at Baker’s Department Store are implemented
carefully to produce the desired results. There are certain fundamental aspects that
require to be followed while doing the implementation. One of the most important
aspects is basing them on the organisation’s goals. Every reward should be geared
towards encouraging the employees to work harder towards achieving the objectives
of the company. It is also important to involve the employees while implementing the
policy initiatives and practices. These are the recipients of the rewards and as a result,
their input is significant.

Rewarding teams is also an important aspect when implementing policy initiatives

and practices. This creates healthy competition where each team works hard to
emerge the best. The following are the steps to that Baker’s Department Store should
consider for effective implementation of policy initiatives and practices (Perkins,
2018):

Step 1-Baker’s Department Store should come up with a rationale to introduce the
policy.
Step 2-Establish the Critical Success Factors (CSF) of the organisation.
Step 3-Review the already existing reward policy.
Step 4-Encourage stakeholders especially employees to give their inputs.
Step 5-Come up with clear goals for the rewards.
Step 6-Review the external factors such as government policies.
Step 7-Check whether the rewards will fit into the organisation by considering issues
such as the organisation’s culture.
Step 8-Get approval from the relevant authorities for the awarding to take place.
Step 9- implement the policy formulated and make sure all the stakeholders know
about the new policy.

Equity and Fairness of Reward Policies and Practices

2.2 The significance of equity, fairness, transparency and consistency as they

affect reward policies and practices

Significance of equity
Equity is an integral part of any reward policy as stipulated by Perkins, (2018) in his
work. This involves ensuring that employees with similar achievements get the same
rewards for their efforts. It is not right to reward some employees with bigger rewards

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than others when their achievements were the same. If the available rewards are not
enough, it is better to wait until there are enough rewards so that each and every
recipient can feel appreciated. Sometimes it might even be necessary to reduce the
number of recipients so that everyone can receive a reward equal to his or her
achievements.

Significance of fairness
Fairness is also an important virtue when giving out rewards to employees for what
they have achieved. A process that is not fair will leave some employees unhappy and
this can have negative effects both to the employees and the organisation. A company
such as Baker’s department store which has different department should make sure
that rewards to different departments are optimally fair depending on what the
employees have achieved (Nwaozor& Thompson, 2020)

Significance of transparency
Being transparent entails letting all the stakeholders know how the recipients were
selected. Through being transparent, everyone is satisfied that the people selected
rightfully deserved to be rewarded. The simplest way of being transparent is involving
the employees in selecting the people to get the rewards. But since it might be
possible to involve everyone especially in big organisations such as Baker’s
Department Store, the representatives of the employees can participate in the exercise.

Significance of consistency
Consistency is rewarding the employees at certain stipulated times without failure.
There should be a set timeline on when the rewards are to be given out. Most
companies prefer to give awards annually but this can change depending on the policy
of the particular company as White, (2016) has explained. Being consistent ensures
that everyone involved is adequately prepared and ready. It also gives the employees
something to look forward to especially if they have been working extra hard.

To see that good practice is followed, it is advisable to automate a significant portion

of the rewarding process. It might not be possible to automate the entire process since
there are things which can only be done manually. But the department store can
automate aspects such as selection and announcement of the recipients. With proper
automation, all the stakeholders including the employees will be able to monitor the
process even remotely using portable devices such as smart phones.

Line Managers and Their Contribution to Reward

3.1 The various ways in which line managers contribute to reward decision
making
Line managers at Baker’s Department Store are the ones directly involved with issues
related to the welfare of the employees including providing suitable working
environment (Rose, 2018). As a result, they are the ones responsible of selecting the
employees who are to be rewarded. This responsibility involves applying the various
outlined methods to identify the employees who deserve rewards. The line managers
usually receive lists of the employees who are eligible to be rewarded. From the lists
they select the specific employees who are more qualified for the rewards.

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Another important role of the line manager in reward decision making is identifying
the appropriate rewards for different achievements (Nwaozor& Thompson, 2020).
The rewards given need to be suitable both to the organisation and to the recipients.
There are rewards which might not produce the desired results even if they seem
appropriate. Sometimes it can be challenging to come up with the rewards that will be
appropriate since different employees have different needs. A good example is an
employee who is given a salary rise but not a promotion despite being qualified for a
higher role. Such an employee will accept the salary rise but will not be satisfied
because he or she wanted to be given a bigger role.

Line managers also have the duty of balancing the rewards given to the different
employees. It is not wise to give big rewards to some employees and then give very
small rewards to others. The ones who receive the small rewards will feel as if they
were not fully appreciated. Line managers need to make sure that the rewards are
proportional to what every employee has achieved.

HR can support managers to reduce the various risks identified by ensuring that the
employees are competent and properly qualified. This will ensure that the various
duties in the department stores are executed with high levels of professionalism. HR
can also support the line manager to reduce the various risks identified through
providing all the required resources on time. With this, it will be easier to plan and
prepare for the award process to be implemented.

Organisational Performance and the Link to Reward

3.2 The contribution of extrinsic and intrinsic rewards to improving employee

contribution and sustainable organisation performance
Both intrinsic and extrinsic rewards are fundamental to the achievement of
organisation’s objectives. This makes it important the contribution of each type of
rewards.

Contribution of intrinsic rewards

Intrinsic rewards include things such as professional growth, personal achievement,
accomplishment and a sense of pleasure (White, 2016). These particular reward help
retain employees especially the ones with special sets of skills which can help the
organisation significantly. They achieve this through making the employees happy
and satisfied when working at a particular organisation. When the employees are
happy, there is a very little likelihood that they might look for work somewhere else.
The employees will be looking forward to coming to work because they love what
they do and this will ensure that the organisation will have a strong workforce. A
perfect example is Baker’s Department Store ensuring that all employees enjoy
periodic leaves without failure.

Contribution of extrinsic rewards

Extrinsic rewards are the tangible rewards such as money, house or a car (Michael,
2017). These are mainly given to individual employees because of their performances.
The rewards help the employees who receive them grow personally and feel
appreciated. A person who receives this kind of reward will most likely use the
reward to better his or her life. The person can move to a better neighbourhood or do

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something that will improve his or her status. Such an employee will be happier and
this will directly benefit the company because the productivity of the employee will
be higher. An example of good practice in extrinsic rewards is the department store
providing housing to some of its employees who are eligible.

Recommendations

Baker’s Department Store should seriously consider using the total reward policy
more often. The approach should be combined with other basic approaches so as to
produce the desired results. It is also advisable for the department store to further
automate its rewarding process. Even though some of the aspects are already
automated, it is helpful to utilize the very latest technology since it is more efficient.
Furthermore, the department store should involve the employees more in the reward
process so that everyone can be on the same page at all times.

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References
Jones, S. E., & Perkins, S. J. (2020). Reward Management: Alternatives Contexts and
Consequences 4th edition.
Michael, M. (2017). The Effect Reward Management Practices On Employee
Engagement A
Case Study On Varnero Construction (Doctoral dissertation, Addis Ababa
University).
Nwaozor, H. O., & Thompson, C. C. (2020). PRINCIPALS’REWARD
MANAGEMENT
STRATEGIES AS A CORRELATE TO STAFF PERFORMANCE IN
SECONDARY SCHOOLS IN DELTA STATE. Unizik Journal Of Educational
Management And Policy, 3(1).
Perkins, S. J. (2018). Processing developments in employee performance and reward.
Journal of
Organizational Effectiveness: People and Performance.
Rose, M. (2018). Management: Alternatives, Consequences and Contexts, London:
CIPD. Rose,
M.(2018) Reward Management: A Practical Introduction, 2nd edn, London:
Kogan Page. Human Resource Management, 162.
White, G. (2016). Reward management. Edward Elgar Publishing Limited.

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