Introduction: Reward For Performance And Contribution
Task 1: Presentation Pack
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S1: Introduction
One of the most important parts of performance management is the management of managers and employees.
The activities of the employees have a huge impact on the entire organization's performance and are therefore rewarded.
The different types of payment that are done by organizations based on employees' performance are psychological, monetary and non-monetary.
In organizations such as Body Image, reward systems are used for multiple reasons, which include retention, attendance, employee commitment, and job performance. The improvisation of employee performance, as well as effort, occurs due to the award system.
S2: Principles of reward and its importance to organizational culture and performance management
The first principle of reward is developing reward experiences that are natural and positive (Hartinah et al. 2020).
Another principle is an extension of the line of sight among outcome and effort for encouraging smart working and integration of reward for offering the customized deal.
The importance of reward principles in the case of organizational culture and performance is high as it makes an impact on profitability and productivity.
It is necessary to align organizational goals and rewards for achieving a win-win partnership. As Body Image has its own personality, therefore, culture is developed in the respective organization without using 'one-size-fits-all' templates of business culture. At the core of the culture of Body Image, the important aspect is rewarding, whose positive aspect is improvement in business. On the other hand, it has disadvantages as well, which include the addition of employees towards the reward.
S3: Reward Practices
In the case of performance management in an organization, the availability of an appropriate reward system assists in keeping employees maintains loyalty.
The different types of rewards that are provided for the improvement of performance management are additional payment and public reorganization (Shahi et al., 2020).
In addition to the advantages, there is the presence of disadvantages as well, which includes an increase in maintenance cost and a lack of benefits of long-term.
In recent times, reward practices have been reinforced, which is considered to be a high level of commitment by organizations such as Body Image. Although the awards are given based on the performances yet those who do not receive them are found to be less motivated.
S4: Ways to implement reward policy initiatives and practice
The two types of reward policies are monetary and non-monetary reward policies, whereas in monetary, the payments are done in the form of hikes and bonuses by organizations.
The employee's intrinsic needs are incentivized through non-monetary rewards policies and are thus counted to be ideal.
The practice of non-monetary is performed by providing membership in exclusive clubs, proving transportation and housing (Mwita, 2019).
Monetary policy being a natural method, is used for motivating employees, whereas non-monetary, being an extrinsic reward, is different from the prior one. For example in monetary, the salary is increased once a year based on the previous year's work performance and the bonus is paid on special occasions such as Christmas. The implementation of both the policies is done by the HR department by identifying the contribution of employees.
S5: Provide rewards based on performances
The line managers are responsible for managing and overseeing whether employees are able to fulfill the goals of the business as rewards are provided accordingly (Peikes et al. 2018).
In both, the policies, communication and feedback play an important role as based on the communication level and feedback obtained about the personality, the reward is selected.
The integration of total reward strategy and people practice is found as it provides an advantage in compensating employees.
In order to provide rewards based on performances, the HR managers follow different steps such as checking their performances, communicating with them, and seeking feedback from others.
S6: Ways through which people and organizational performance impact the approach to reward
The measurement of organizational performance is done based on two important factors such as operational performance and economic performance (Sanyal and Hisam, 2018).
People performance refers to the way of motivating the employees, reviewing their performances and incentivizing them.
One of the core principles in performance management is transparency, whereas the other one is fairness as well.
Transparency in organizational performance declares that it is a two-way path as openness and honesty are followed by employees and management towards each other. Fairness performance management is known to be looking after the fact whether the individuals perceive the main performance management elements.
S7: Presence of Advancement
Among staff and managers, multiple issues are expected to be coming in people performance which includes poor time management (Saeed et al. 2019).
Another specific issue is lower quality prioritization due to the poor decision-making capacity of companies such as Body Image.
The negative impact of competition on business includes minimizing the market share of the individual organization along with shrinking the present customer base.
Irrespective of the presence of advancement in strategy utilization as well as software, there is still availability of issues in both people's performances and organizational performances. In case the presence of a huge amount of competition in the market results in a decrease in the price of products and degradation in profit margins.
S8: Comparison of different types of benefits along with metrics
Different types of employee benefits that are provided to them are stock options and health insurance.
The improvement in recruitment capability is the primary benefit of the total reward strategy, along with an increase in total benefits awareness (Raguso, 2018).
The rate of retention of employees can be improved through the implementation of a total reward strategy as well.
Among all the three benefits, the appropriate one for Body Image is an increase in employee retention rate.
The improvisation in the capability of recruitment is an essential aspect as it assists in improving the performance of organizations. In addition to this, one of the features of total reward awareness increase is developing a program of total reward compensation. The advantage that is gained from the respective program is appropriate communication regarding the benefits with all the employees. Through the coordination, it becomes easier to make the individuals understand that the benefits are not only applicable for the future employees yet to the recent ones as well.
S9: Contribution of extrinsic and intrinsic rewards
Extrinsic reward is considered to be the reward that is visible and tangible and provided to employees as an achievement.
Intrinsic reward is defined as a reward that is provided in the form of incentives to the employees due to high-level performances.
In comparison to extrinsic and intrinsic rewards, extrinsic rewards are used more by organizations for performances and initiatives (Hassan et al., 2020).
The team is rewarded intrinsically in different ways, such as providing employees with much autonomy and empowering e employees to become purpose-driven.
Intrinsic rewards being psychological rewards in nature are given to individuals due to meaningful performances done them. As the work done is internal; therefore the reward is considered to be intrinsic. Extrinsic reward is known to be having a huge influence on the engagements of employees, which has a negative impact as well. Through extrinsic reward, the level of sustained engagement decreases, and it becomes difficult for employees to recognize the intrinsic reason for the continuation of engagement.
S10: Conclusion
Based on the above discussion, it can be concluded that not only intrinsic rather extrinsic awards are equally important for employees and organizations.
In order to achieve the respect reward, individuals need to stay focused on their job role with full effort as well as dedication.
The main highlighting part of the study is the benefits provided by organizations, such as rewarding employees for the good fare of organizations and employees as well. As a consequence of this, the principles of performance management and rewards are explained in detail.
Task 2: Briefing paper
Executive summary
This report is based on the evaluation of rewards for performance and contribution in the case of Body Image, a medium-sized retail firm in the UK. Based on the internal and external business environments of the UK, it is quite clear that the economic outlook is quite devastated due to the Covid-19 situation. In case of gathering benchmarking data, Published data, Pay Clubs, and Special surveys have been taken under consideration here. It is essential for this firm to develop an organizational reward package to ensure a better satisfaction level for the workers.
Assessment of business context of reward environment
Reward environments can be influenced by external and internal business environments and in the case of Body Image, it is essential to undertake these factors into consideration to ensure a better reward program for workers. The firm has its headquartered in the UK; for which it is essential to consider each of the contexts of the business environment with respect to this specific country. As per the economic outlook, it is observed that in 2022, the growth is 5.01% which is a decrease from the previous year, and in upcoming years, the growth will decrease more.
In refer to the lower GDP growth, it can be stated that the total reward strategy of Body Image can be most affected as it is not possible to develop the "inclusive reward package" for employees. As per the labor force trend, it is observed that the UK employment rate has increased by "0.1 percentage points" quarter to 75.5% (Statista, 2022). The presence of Covid-19 has already affected the economic context whereas a strong employment growth can raise pay pressures within Body Image. The financial provisions cannot be well maintained in this context as well which can affect the reward program for the well-being of employees.
Another trend such as regional differences in the wages and cost of living is also responsible for affecting the equal pay structure of Body Image. The reward for performance and contribution might not be well maintained and as an impact, a lower level of employee satisfaction and engagement along with a lower level of retention can be observed here. As per the legal frameworks, the presence of "Equality Act 2010", "The Employment Act 1996", minimum wage, holiday pay, and others are most beneficial for Body Image to ensure better workforce structure here and also to maintain each of the rights of the employees (Rolf et al. 2022). It indicates high employee satisfaction and a higher level of commitment as well. In the case of pay review, the trend of gathering employee feedback is observed in the UK and it helps Body Image to gather realistic opinions that can be effective to develop the “inclusive reward package”.
As per the above figure, the increasing weekly earnings (pay trend) in UK is effective for Body Image to gain high employee satisfaction whereas it can raise pressure on the revenue level due to economic pitfalls of pandemic situations. In case of an internal business environment, cultural drivers can be taken under consideration. In the case of UK, presence of courtesy, discipline, and punctuality are effective enough for Body Image to develop a good work culture here (Canestrino et al. 2020). A diversified workforce, transparent communication, and friendly behavior are also beneficial to motivate the workers to engage with the organization more suitably.
Appropriate ways to gather benchmarking data and measure
Benchmarking is considered the core basis for planning a reward strategy whereas, in a competitive employment market, it is quite critical to benchmark the reward. According to Teinemaa et al. (2019), benchmarking is the process to measure key business metrics along with practices and compare them within business areas. In the case of Body Image, it is essential to consider three different tools in which benchmarking data might be gathered. Published data, Pay Clubs, and Special surveys can be taken under consideration. With the help of published data, it can be possible for Body Image to measure the existing performance level of workers against the collected data. The collection of published data is also useful enough to maintain the proper accuracy context while comparing the performance. Pay clubs are the most useful tool to find industry-specific information and through this, it is also possible for Body Image to maintain the aspect of gathering relevant and current information (Herrmann et al. 2021). Presence of special surveys is also effective to gather benchmarking data by setting the proper baselines, and goals along with measures of the progress. Thus, from above, it is quite clear that by using the aforementioned tools, it can be possible for Body Image to plan an appropriate reward strategy for gaining high satisfaction from employees.
The published data can be measured by primarily selecting subjects to benchmark, deciding on organizations to benchmark and documenting the present processes. According to Eisert et al. (2020), in order to measure the pay club, the first thing that is needed to be performed is an analysis as well as a collection of data. The performances are needed to be measured by comparing them with the way they are gathered. The respective data is being collected with the help of special surveys. The reward consultant database consists of all the information that is collected from the survey. As soon as the measurement of performances is done, plants are developed for implementation of the changes that are necessary.
Finally, the entire process is needed to be repeated such that it helps in improving the benchmarking process. As stated by Mohammed et al. (2020), among all the three different approaches to gathering benchmarking data, the method that is considered to be most useful for evolving insights into strategies of reward is a special survey. The special survey of benchmarking data is done to measure customer satisfaction, website feedback, employee engagement as well as customer loyalty. As a consequence of this, the respective special survey helps to obtain a clear overview of the target audiences as well as employees' viewpoints, as changes are performed depending on it.
Ways to develop organizational reward packages and approaches
In order to develop the reward package for Body Image, initially, it is essential to align the reward strategy with the HR strategy of this firm. It is also essential to know the entire organization along with existing business trends to develop the reward package. Regular benchmarking process and use of the “independent pay consultant” can be useful also to develop better pay and benefits advice severely (Aihr, 2022). Annual schemes need to be developed by keeping a strong focus on the pay trends in the retail sector of UK. Economic outlook such as lower GDP growth needs to be considered as well to avoid pressure on the pay scale. As per the below figure, this structure can be adapted by Body Image to maintain the pay equity in reward package for all employees.
The things that need to be considered are the job evaluation, existence of proper fairness in reward strategy, appropriate leveling of jobs along with proper grade and pay structures. Job evaluation helps to maintain the “structured wage payment practices” and also provides such scope to conduct skill development for the workers within the firm. It helps to identify the equal pay structure in reward packages and also ensures that the staff must compensate as per the required job skills. Existence of fairness in the reward strategy is most beneficial to ensure a proper level of satisfaction for the workers and also to implement the relevant pay trends in the reward package to make it more effective (Rolf et al. 2022). Proper leveling of jobs as well as proper grades can be helpful for Body Image to promote a more developed structure of the reward package without facing the issue of pay inequality. Pay structures need to be developed as per job roles within the firm to avoid the concern regarding unequal pay structure. It can also facilitate the establishment of a strong reward package by implementing the pay trend context of the UK.
Explanation of legislative requirements that impact reward practice
Reward strategy, which is an integral part of the growth strategy of Body Image focuses on the introduction of reward practicing within the business consistently and fairly. In the way of creating the strategy, the adoption of the various legal requirement not only help the business organisations to ensure the development of equal opportunities for employees but also allow the organisations to recognize the good workers and their contribution. As opined by Noor et al. (2018), the conducting of reward practices in a lawful way is crucial for attracting, engaging as well as retaining workers in an operational way that in turn contributes to the enhancement of business productivity.
Various elements of the reward strategy include equal pay and reward, working hours, minimum pay, holiday leave and others that need to be bounded by effective legal regulations in order to make the impact of reward practices more purposeful. In the area of reward and equal pay the “national minimum wage act of the UK, 1998” is effective for objectifying pay fairness and proper reporting within the workplace. The act applied to all workers over 16years of age and provides rights to employees in order to be paid the same for the equivalent or same work (Ngwa et al. 2018). On the other hand, the “Equality act of 2010, UK” also focuses on the provision of legal protections to employees from various workplace discrimination that are vital for ensuring the flourish of healthy culture in the workplace and conducting rewarding practices lawfully.
Besides, it can be stated that a suitable working hour is pivotal for increasing productivity and also for reducing operational costs. The “working time regulations, 1998” are concerned with that context that includes the average working hours of 8 hours and working week of 48 hours for employees. In the UK as per this act, the holiday entitlement also includes a public holiday for full-time workers are 5.6 weeks (Okoli et al. 2021). By integrating all the above-mentioned regulations, Body Image can accelerate a compassionate rewarding environment that endorses the employee's motivation and also conduct management of reward in an ethical way. The fulfillment of the various areas of legislative requirement such as equity pay, provision of healthy working hours, prioritizing employees well being, rewarding ethically, and others with taking consideration of regulatory implications help to shape the reward strategy towards deriving the strategic advantages for Body Image.
Different approaches to performance management
Performance management can be defined as a continuous approach that allows the business organizations to ensure the achievement of organizational objectives through streamlining the employee's efforts with the strategic goals. It has been seen that in the way of managing the employee's performance the HR executive of the business organization plays an effective role in the designing as well as the implementation process (Nwaozor and Thompson, 2020). The key steps in the management process include development, planning, monitoring, rewarding and review. In the context of managing both organizational efforts such as sales and manufacturing, the HR personnel of Body Image can focus on integrating performance management tools correspondingly.
Various types of performance management are there such as 360-degree feedback, monitoring and coaching, CPD, and the appraisal process that are effective for monitoring as well as motivating employees' performance. 360-degree feedback is a potential tool that allows every employee to reevaluate their performance on the basis of feedback. HR personnel of Body Image by incorporating this method can enable of monitoring the employee's performance and also meet their worker's needs that in turn contribute to the enhancement of operational efficacy. The approach helps to uncover various procedural issues, suitable for improving the employee's output by offering constructive feedback and reducing the discrimination tendencies in the way of performance management (Anku et al. 2018). Besides, some limitations are also there including ineffective for an inexperienced, anonymous, large degree of data collection and others.
Continuous performance development (CPD) is another effective approach under the concept of performance management that focuses on documenting and tracking of individuals' knowledge, skills and experience both informally and formally for the development of individuals' self-esteem along with a development plan. It can be stated that the HR team of Body Image in their way of formal training can use the approach for the purpose of providing a clear understanding regarding the job responsibilities and roles of the newly joined one. As opined by Anku et al. (2018), the presence of a clear view regarding job designation helps the employees to give their best and at the time enhanced their accountability correspondingly. The enhanced employee performance greatly influences organizational growth. CPD activities or practices can be sometimes time-consuming as well. Furthermore, the incorporation of performance review meetings in the process of performance management can be helpful in providing a structure for planning that support good merits and foster the employee's experience. Thereby, Body Image can become way more capable of benefiting employees' satisfaction, target achieved and market growth.
Review of the role of people practice professionals
People professionals play a mediating role in terms of the proper execution of organizational strategy. The area of reward management is facilitated by the presence of people professionals that is effective for the development of various monetary benefits for the business organization. It has been seen that both the line managers' and the HR personnel's combined efforts are crucial for building a robust reward strategy as well as organizing reward activities in operation (Cipd, 2020). Line managers possess the responsibility of not only managing day to day operations and people but also implementing reward policies and approaches to supporting the team's development. In the context of outsourcing all the strategic activities as well as overseeing the employee performance through taking effective decisions, the HR executive helps the line managers in the allocation of employees' training and building of employees' morale. It has been also seen that people professionals provide support to the line manager by encouraging them to make better decisions regarding rewarding by utilizing all the intangible assets within the organization.
For example, the people professionals of Body Image can help the line manager in the building of a total reward strategy by enhancing more communication in the decision-making process. The establishment of a total reward strategy may help Body Image in terms of attracting new talent in the business and also the provision of development of empowerment opportunities for their employees. Another example includes the recognition of non-financial and financial rewards that can be done by line managers with the help of the HR manager's leadership that provide motivation to the employees. Lastly, a consistent and accurate reward judgment is helpful in the building of a productive culture as it motivates employees by minimizing discrimination. The lack of transparency in the making of reward judgment not only affected the employee's morale-building but also reduces the workforce efficacy responsibility.
Explanation of to making of reward judgments by line managers
In the way of making rewards effective it is important to recognize the managerial ability to run continuous improvement in the implied decisions or approaches. It has been seen that line managers help in the framing of organizational approach in terms of proper rewarding. As opined by Peoplepointhr (2020), both the employees and line managers are accountable for the setting up of reward judgment. Line managers help to communicate with the organizational hierarchy in terms of reward benefits as well as foster the development of reward strategy for the organization. In the context of taking reward judgment in an ethical way, the support of resources and tools are needed for line managers.
In various organizational approaches such as the development of opportunities, the line manager can help to ensure the less occurrence of discrimination through the establishment of a code of practices. On the other hand, the line managers are the useful resources in order to communicate the well-being and health of employees and thereby business organizations can provide support to their employees respectively (Davidsonmorris, 2020). The fulfillment of employees' needs helps to derive effective satisfaction that reflects in the market revenue’s growth of organizations. Besides in the area of work-life balance, the line managers are placed to spot the initial signs of burnout and stress among workers thereby business firms can endorse a positive intervention as per requirement.
In addition, Body Image also focuses on the building of an effective reward strategy and in this path the line managers can help to foster the provision of equal opportunities for the employee's empowerment. The path of decision making in rewarding needs to be fair and ethical in the context of building positive employee morale and accelerating the positive culture within the workplace (Martono et al. 2018). Various ethical factors are there that influence the reward decisions such as alienation of employees' goals with organizational objectives, presence of trust, appropriate rewards and others that have the potential to determine the nature of reward decisions in an equitable and fair manner. Moreover, Body Image can focus on building rational decisions in the aspect of rewarding their employees for nurturing future business growth.
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