An analysis of the types of non-financial rewards that could be introduced and how this may affect retention. An analysis of the view on bonus arrangements and any recommendations in terms of required changes. Detailed recommendations to the issues raised will be given to the Director of Reward at the end of the report. 1.1 The organisation’s current reward strategy MI currently uses the extrinsic rewards strategy to compensate its employees for the contribution they make towards its viability. Basically, extrinsic rewards include direct compensation, indirect compensation as well as non financial rewards (Robbins, 1993). Direct compensation in this case includes a basic wage salary, bonuses based on performance as well as profit sharing. Apart from the high basic salaries being earned by the traders in this particular case of MI, the bank also calculate their rewards on overall profitability of the trading operation and this entails that they get anything between 30 and 50 % of what they have earned in profit for the Bank. Performance bonuses significantly contribute to the package earned by the dealers and these motivate them to put optimum performance in their operations. It can also be noted that all dealers currently attract a package of benefits including a company car, healthcare and pension contributions. Grobbler (1998) suggests that these can be awarded to the employees on the basis of their performance. The traders are treated as the most valued assets to the bank as they may leave if they are not satisfied with the reward system for their performance. As such, their rewards are designed in such a way that they will appeal to their interests which in turn can lead to their retention in the organisation. It can be observed that the major strategy used by the bank to offer rewards is based on overall profitability of the bonds that have been sold. The traders are entitled to get a certain percentage of the profit as their bonus. However, the external environment plays a significant role in shaping this strategy. The strategy is influenced by gathering and analysing competitor information so as to come up with the best reward strategy. In this case, MI tries to remain on top of other organisations hence it seeks to differentiate its rewards strategy from other competitors. The organisation is compelled to offer the best reward on the basis of the situation obtaining in the environment. The level of performance of the economy also shapes this strategy since bonuses are calculated on the basis of overall profitability of the trading operation. In the event that the bonds sold have poorly performed, this entails that their rewards will be lower which shows that the external environment has a bearing on the strategy of rewards. Though there is no direct government intervention in the operations of banks with regards to their reward systems, it can be noted that more financial institutions are becoming wary of not rewarding undue risk taking. For instance, the recent Turner report contributes to the mounting pressure for financial organisations to review their bonus systems in order to protect the interests of the shareholders. These are some of the external factors that shape the rewarding strategy by MI. 2.0 What motivates the dealing team? Since the dealing team has a very little loyalty to the
Introduction “Our knowledge of motivation tells us that people do what they do to satisfy needs,” (Robbins, 1993, p. 581). Before they do anything, they look for the payoff or reward. As such, this report has been designed to outline a proposed reward strategy that might be adopted by the Director of Reward at Massaman International (MI), a securities trading arm of Massaman Investment Bank in London…
Employee Compensation and Benefits
The employees of a company are considered as the most important one of its factors of production. A company with efficient workers is more likely to be successful as the work of the employees has a direct impact over the performance of the entire organization.
Microsoft provides compensation as well as benefit packages to its employees to an above average limit. But considering the past five years, it can be seen that many benefits have been cut short. One of the main benefits taken away was the Employee Stock Purchase plan.
Nowadays humans are considered as one of the most important assets required to carry out the tasks effectively and efficiently. Among many techniques which companies utilize to attract the potential minds, keep and encourage its people is Compensation and Benefits Management (Zingheim and Schuster et al., 2009).
Currently Nike has over five hundred factory or office locations in around 45 countries all over the world, the majority of these are in Asia. With such extensive locations, Nike, an American corporation has a sizeable percentage of employees from diverse groups, Nike targeted to become one of the best Employer of Choice at the turn of the 21st century.
Non-monetary compensation implies involve benefits given to workers in regard to the services they render to the company (Noe, Hollenbeck, Gerhart, & Wright, 2011). They encompass Leave Policy, Car policy, Health Policy, Indemnity, Overtime Policy, Leave travel Assistance
Every organization strives to offer its employees tangible and intangible benefits so that they are satisfied and less likely to quit or contribute towards high employee turnover.
Strategic compensation is a
ons of behavior based on the individuals or employees’ perception of the prospect of realizing their desired outcome (Noe, Hollenbeck, Gerhart & Wright, 2014).
According to the expectancy theory, employee’s motivation is a product or outcome of three elements. First is how
3 pages (750 words)Essay
Hire a pro to write a paper under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Apply my DISCOUNT
Got a tricky question? Receive an answer from students like you!Try us!
Let us find you another Essay on topic Human Resources- Compensation and Benefits for FREE!