An Article on Rewards

Like a child being given a chocolate cupcake and a big hug after cleaning her room, rewards and recognition can be powerful tools for employee motivation and performance improvement. Many types of rewards and recognition have direct costs associated with them, such as cash bonuses and stock awards, and a wide variety of company-paid perks, like car allowances, paid parking, and gift certificates. Other types of rewards and recognition may be less tangible, but still very effective. In today's workplace, companies and management are increasingly using non-monetary rewards as an incentive to motivate and influence employee performance.Recognition should be part of the organization's culture because it contributes to both employee satisfaction and retention. Organizations can avoid employee turnover by rewarding top performers. Rewards are one of the keys to avoiding turnover, especially if they are immediate, appropriate, and personal.
Total Rewards
Total rewards is the monetary and non-monetary return provided to employees in exchange for their time, talents, efforts and results. It involves the deliberate integration of five key elements that effectively attract, motivate and retain the talent required to achieve desired business results. Total rewards strategy is the art of combining these five elements into tailored packages designed to achieve optimal motivation. For a total rewards strategy to be successful, employees must perceive monetary and non-monetary rewards as valuable.
Elements of Total Rewards
There are five elements of total rewards, each of which includes programs, practices, elements and dimensions that collectively define an organization's strategy to attract, motivate and retain employees. These elements are:
Compensation
Benefits
Work-Life
Performance and Recognition
Development and Career Opportunities
Context for Total Rewards
The WorldatWork model recognizes that total rewards operates in the context of overall business strategy, organizational culture and HR strategy. Indeed, a company's exceptional culture or external brand value may be considered a critical component of the total employment value proposition. The backdrop of the WorldatWork model is a globe, representing the external influences on a business, such as:
Legal/regulatory issues
Cultural influences and practices
Competition

The Exchange Relationship
An important dimension of the model is the "exchange relationship" between the employer and employee. Successful companies realize that productive employees create value for their organizations in return for tangible and intangible value that enriches their lives.
Total Rewards Strategy = Leveraging Five Elements to Attract, Motivate, Retain
· Compensation
· Benefits
· Work-Life
· Performance and Recognition
· Development and Career Opportunities
The Exchange Relationship
EMPLOYER PROVIDES: EMPLOYEE PROVIDES:
Total rewards valued by employees Time, talent, effort and results
Context of Total Rewards
· Business Strategy
· Organizational culture
· HR strategy
· External influences (competition, industry, regulation, etc.
· Geography (location of workforce)


Monetary Rewards
Any benefit an employee receives from an employer or job that is in from of monetary benefits for the specific purpose of attracting to the company as well as retaining and motivating the employees.
Methods of Monetary Rewards
Incentives
Perks
Increase in pay
Holiday Trip sponsored by company
Retirement Benefits
Non Monetary Rewards
Any benefit an employee receives from an employer or job that is above and beyond compensation package for the specific purpose of attracting to the company as well as retaining and motivating the employees.
Non-Monetary rewards include formal and informal acknowledgement, assignment of more enjoyable job duties, opportunities for training, and an increased role in decision-making .
Employers today are doing more in the area of non-monetary rewards compared to a year ago, according to a new survey by Watson Wyatt. The three most prevalent non-monetary rewards are advancement opportunities (76%, up from 60% in 1999), flexible work schedules (73%, up from 64%) and opportunities to learn new skills (68%, up from 62%).
"Top-performing employees report that they want greater opportunities to advance and hone their skills, and employers appear to be listening," says Paul Platten, Watson Wyatts practice leader for strategic rewards consulting.
Employers participating in the survey were asked to identify their top performers and invite them to participate in a survey to measure and rank their opinions about the effectiveness of various reward programs.
Factors Affecting Decision-Making Process of Top Performers
1. Opportunity to develop skills
2. Opportunity for promotion
3. Compensation
4. Vacation/paid time off
5. Type of people/culture

Methods of Non Monetary Rewards
Rewards can be based on an event (achieving a designated goal) or based on a time frame (performing well over a specific time period).
Rewards that are spontaneous (sometimes called on-the-spot awards) are also highly motivating and should also use a set criteria and standard to maintain credibility.
Handwritten thank you note
A letter of appreciation in the employee files
Handwritten cards to mark celebratory occasions
Recognition posted on the employee bulletin board
Contribution noted in the company newsletter
Provide public praise at a staff meeting
Take the employee out to lunch with Senior Management

Send people to conferences and seminars and ask people to present a summary of what they learned at a conference or seminar at a department meeting
The photo of the employee with a small write up about the person and his achievement on the notice board.
Star Performer of the Week
Boss of the Day - by giving stars

Regards,
Rajat Grover