Reward System in HRM
The achievement and benefit received by employees for their job performance in an organization are known as the reward. Reward system exists in order to motivate employees to work towards achieving strategic goals which are set by entities. Rewards are positive outcomes that are earned as a result of an employee’s performance. These rewards are aligned with organizational goals. When an employee helps an organization in the achievement of one of its goals, a reward often follows.
Employees join the organization within the certain expectation of reward. Some may be expecting for better salary and wages i.e., economic rewards while other may be seeking for facilities like accommodation, transportation, health, safety and other benefits as the reward. Thus, economic and non-economic benefits provided by the organization to employees for their job performance regardless of their expectation is known as the reward. Employees must be communicated about the reward provision in an advance.
Matching the reward system with the level of performance for each job assigned in the organization is known as reward management. To make effective reward management, an organization has to prepare an appropriate reward system. Attractive and transparent reward system must have a quality to motivate and empower the dedicated and reliable employees. Reward management will also assist in planning the long-term financial management.
In conclusion, Reward management means ascertaining and providing the reward to an employee according to their job performance and maintaining the record of this. This will motivate employees to make their effort in achieving organizational goal. Reward management assists in making different identification among the like-minded organizations. Appropriate, up to date, transparent and competitive reward management will provide high morale to the employees. They feel proud to be associated with the organization. A reward can be considered as a benefit, facility and career development. Reward management should match the job performance level, employee’s requirement, and overall organizational capacity.