"Monetary" awards are known to bring about more motivation in employees than non monetary wards although recent studies differ in this view. Reward and recognition usually that direct costs associated to them, for example cash bonuses, discounts, shares or a variety of paid perks by the company which may include parking, car allowances etc., However, other rewards, “non monetary” may be less tangible but still effective. These intangible rewards may include informal or formal acknowledgement of an employee and his work, more job assignments, different training opportunities etc. The primary goal of rewards as defined by Jack Zigon is “something that increases the frequency of an employee action” (1998). Allen & Helms suggest that “reward systems should be closely aligned to organisational strategies, to achieve desired goals” (2002). Steven Keller (1983) suggests that “people are motivated to higher levels of job performance by positive recognition from their managers and peers”.
As some employees are motivated mainly by monetary rewards, they will try to improve their job performance to achieve these rewards. On the other hand some people view monetary rewards as vulgar and are discouraged by such offers. It is important to understand that not everyone can be motivated to increase work performance with financial perks. This group is more likely to be motivated by non-monetary perks like getting an extra day off, or having lunch with the head.
I work on a part time basis for the Arcadia Group. The organisation I work for rewards its employees in the following way:
• Salary
• Bonuses
• Paid Holidays
• Pension Plan
• Discount on all Arcadia Group merchandise
• Company cars
• Flexible reward scheme to suit an individual’s life style
• Interest Free season ticket for travelling
• Cash incentive if you recommend a friend to work for the organisation
The Arcadia Group has different rewards for different groups, for example senior managers and top executives are given allowances for company cars and this is good for the corporate image of the group. However, a part time junior sales representative such as myself is not given this benefit but is entitled to a staff discount on goods. Another example of this difference is a pension scheme which a permanent member of staff is entitled to whereas I do not have a permanent contract with the company, therefore, I am not entitled to this benefit. These rewards differ because I do not work permanently with the company however, in the examples given above, senior managers and permanent staff have probably been with the company for a long time therefore they deserve and expect these rewards as part of the reason why they have been with the company for so long. In my opinion there should be different rewards for different people dependant on the job they do and how long they have been with the organisation. As a relative new recruit I would not expect to receive the same benefits enjoyed by someone who has been with the company a long time. In this way fairness and equity are ensured.
John Stacey Adams (1963) theory of job motivation suggests “The actual sense of equity or fairness (or inequity or unfairness) is arrived at only after incorporating a comparison between our own input and output ratio with the input and output ratios that we see or believe to be experienced or enjoyed by others in similar situations”.
Inputs - Inputs are typically: effort, loyalty, hard work, commitment, skill, ability, adaptability, flexibility, tolerance, determination, heart and soul, enthusiasm, trust in our boss and superiors, support of colleagues and subordinates, personal sacrifice, etc.
Equity
dependent on comparing own ratio of input/output with ratios of 'referent' others - People need to feel that there is a fair balance between inputs and outputs. Crucially fairness is measured by comparing one's own balance or ratio between inputs and outputs, with the ratio enjoyed or endured by relevant ('referent') others.
Outputs - Outputs are typically all financial rewards - pay, salary, expenses, perks, benefits, pension arrangements, bonus and commission - plus intangibles - recognition, reputation, praise and thanks, interest, responsibility, stimulus, travel, training, development, sense of achievement and advancement, promotion, etc.
Do you think Chief Executives should still receive large bonuses even if the organisation they have led has underperformed?
Arguments For:
1. Chief Executives are the ones who take on all the stress and responsibility for the business, making decisions which can either be good ones or bad ones.
2. They are the ones who have the links to save the company if the situation got so bad that a take over had to happen.
3. Many chief executives have been with the company for a long time and have helped to build the company up. If the company underperforms they are the ones who can still turn the company around.
Arguments Against:
1. Why should they still receive large bonus when the company does not perform well and others in the organisation may lose their job or have to take a pay cut.
2. They have made the bad decisions that have led to under performance, therefore, they should not receive the bonuses.
3. In fact they should take a pay cut like other members of staff may have to and they should lead by example.
Financial & Non Financial Ways of Rewarding a teacher at a primary school
Financial
1. Salary
2. Longer Paid Holidays
3. Career progression (leading to higher financial reward)
Non Financial
1. Less stress teaching primary school children compared to high school children
2. Longer holidays
3. Having an impact on the lives of the children they teach
Conclusion
In conclusion rewards and recognition are very important because they motivate and improve performance of employees. Money is not the only motivator for people because things such as job satisfaction are also important.
Reference list:
Equality [online]. Available from: http://www.brainyquote.com/words/eq/equality161136.html [Accessed on 1st of May 2010].
Adams equity theory [online]. Available from: http://www.businessballs.com/adamsequitytheory.htm [Accessed on 1st May 2010].
Burton [online]. Available from: http://www.dorothyperkins.com/promostores/dp/recruitment_2003/site/ [Accessed on 1st May 2010].
ZPG [online]. Available from: http://www.zigonperf.com/aboutjz.html [Accessed on 1st May 2010].
Rewards and recognition [online]. Available from: http://edweb.sdsu.edu/people/arossett/pie/Interventions/incentivesrewards_2.htm [Accessed 2nd of May 2010].
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