Q .1Importance of a REWARD STRATEGY in an organization?
ANS.A reward is a token (monetary or otherwise) given to an individual or team in recognition of some contribution or success.
Reward strategy can be described as the most appropriate and effective framework enabling organizations to reward their staff according to their practical contribution to the achievement of their organization’s overall business strategy.
A reward strategy should, then, be devised by employers keeping in mind, and duly considering, that its aim is basically to induce staff behaving and performing in a way which can actually and productively contribute to the organization’s achievement of competitive edge. It could instinctively be argued that, otherwise, rewarding people would represent just money being wasted and spent for no use at all, which is not exactly the reason for which shareholders/stockholders use to invest their money in a business. If whilst designing and developing reward strategy organizations should just consider the business’ needs, it is very unlikely that the reward strategy they have identified would actually produce the intended objectives. A reward strategy needs to duly consider, and aims to satisfy, staff’s needs.
2.WHAT ARE THE COMPONENTS OF TOTAL REWARDS?
ANS.COMPONENT 1 (MONETARY REWARDS)
The purpose of monetary incentives is to reward for excellent job performance through money. Monetary incentives include profit sharing, project bonuses, stock options and warrants, scheduled bonuses (e.g., Christmas and performance-linked), and additional paid vacation time. Traditionally, these have helped maintain a positive motivational environment for employees.
Below are some of the examples of Monetary Rewards
Basic salary – A Competitive salary ensures that a worker is getting paid market rates at a job.
Overtime, Shift, Regional and on-call allowance s are paid other than that of basic pay. They...