The Employee Reward System And Motivation

Although it appears to be easy to control people performances at work when you understand their skills and KSA`s, It could continually be difficult when you actually drop into the real-time scenario. It is because each task, competencies and knowledge differs from the other individual in a work place and in addition any individuals performance is not uniform all over his/her career. The level of performances is dependent of several factors such as stress, colleagues, family, hours of work, holidays, and recognition for work etc.

So consider performance in conditions of recognition directed at the employees for the efforts they put in. So, anybody requires some of kind of recognition or reward predicated on their work to motivate them and perform well.

Reward Systems: According to Aguinis (2008) this is a set of mechanisms for distributing both tangible and intangible returns as part of a jobs relationship.

When we consider the roles of reward system in managing performances of the staff within an organisation, it always tend be both positive and negative. The primary motive of the reward system is to motivate people and reward them for service to the organisation expecting equal results from their performances that finally influence the overall organisation`s performance.

Armstrong (2002) says that the HR personnel concerned with reward management may spend a lot of their time taking a existing reward processes but according to him the main and challenging task is to constantly improve it and tailor it in line with the strategies of the business. Which means using the existing reward policies will not make adequate advantages to the company however the way you manage the then existing policies according to current situation is what is required from the HR specialists. He also adds that if the Business strategy changes then the HR strategy must change and reward system must change accordingly.

Organisations need a reward management system that is strategic for staff and satisfies four main areas: compensation, benefits, credit and appreciation. The setback alongside this in many companies nowadays is twofold i. e. They lack at least one of the above elements (generally recognition and/or appreciation), and the areas that are focussed aren't evidently aligned with company's other strategies.

A successful company has to recognise and reward two main types of its employee activity performance and behaviour. Of two former an example may be the easiest to identify as you are just assigning tasks and judging on the final results. It really is like rewarding the most notable 10 sales achievers in a given time.

Second being rewarding predicated on behaviour is very challenging the other as it is difficult to assess the behaviour and reward. It really is like choosing between individual`s innovation or the quantity of time they're sitting at a desk. There's plainly a big change between two activities.

When companies think about the reward management, they tend to put compensation on top list. The right strategy must always include a compensation plan that clearly links to the objectives of the business for that particular time. Longer term rewards can be offered to some key personnel. This often includes a form of equity ownership.

Companies that don't exceed the compensation levels provided by their competitors face have difficulties in retaining key personnel.

Anyway the importance of recognition and appreciation as key elements of successful strategic reward system can't be disregarded. Both of these seldom get attention they are supposed to but this is amazing as they are the reduced cost/high return ingredients. All personnel in a business would be keen to know if they are doing good or bad, so it is very useful to make them alert to their performance.

Acknowledgement of a person for their specific goals achieved and because of their actions shown is called recognition. While appreciation means showing gratitude to someone for his or her actions. Expressing recognition coupled with appreciation by means of thanks before all the staff by citing examples of their actions that deserved appreciation.

Employee Reward system and Motivation:

Motivation of employees has been in practice and proved to be working for the organisations which started from 1930`s (Lee-Ross, 2002). It really is defined as the process of gratifying internal needs of individual through different actions and behaviors. It pertains on the complexity of mental and physical drives, joint with the surroundings which makes the people perform the way they are doing (Lee-Ross, 2002, 55). Motivation is force that pushes the given individual to act.

So, without proper motivation at work place the employee`s contribution to the productivity remains limited and therefore efficiency of the business is affected. Employees possess the KSA`s required to achieve the requirements of the business nonetheless they should be in the end willing to donate to the company`s growth. High motivation levels lead to higher degrees of work commitment which in turn results high performance of the business (permagon Flexible Learning, 2005). Motivation can be through financial and/or Non-Financial offers from the employers. Both are proven effective to motivate people. Finally helping in maintaining their loyalty and retain them.

Reward system contains all components of organisation, that includes people, processes, rules and procedures, alongside the decision-making activities, which involved the the process in allocating compensation and benefits to employees, in trade for his or her contribution to the business (Griffin and Moorhead, 2009).

As mentioned earlier the primary objective of rewards is to attract, motivate, and retain employees. This helps to achieve the equality of rewards offered to the employees, that are mainly relied on their performance and contributions to the company (Griffin and Moorhead, 2009).

Common types of rewards to attract and retain qualified employees include base pay, perquisites and awards, performance appraisal, indirect compensation, bonuses etc. (Griffin and Moorhead, 2009). One most significant thing that will require employers' attention is though financial rewards serve as the principal tools to attract valuable individual, it is always the non-financial rewards that really helps to retain valuable employees. This might be due to the fact that the non-financial rewards always point into the emotional and psychological well-being of the staff. For instance, providing flexible hours to the senior personnel. Women during required time will be very helpful.

Moreover, the reward system helps the organisation to record the average person performances of the employees and thus their achievements and contributions towards the business are recorded very frequently. So individuals work at their best as they are alert to the monitoring mechanism of the company, in terms of performance is connected to the reward system. Quite simply, they are simply motivated to work at their finest levels to be able to keep their level of performance and co relate with the standards expected from the business. In addition to the above, the reward system helps to maintain useful competition within the business.

A study shows that bonuses and other financial benefits no longer influence the organisation`s long-term goals but this may be not entirely true atlanta divorce attorneys situation. According to numerous experts, a proper reward system in place is a must for each organisation and HR personnel must tailor that reward system to match various departments of your organisation and successfully correspond it to the workforce.

Performance and rewards

Belfield and Marsden (2003) discovered, as studying the data of the 1998 Workplace Operative Relations Survey led in England, forceful facts that the use of performance related remuneration escalates the performance results, even though this connection is influenced by the construction of workplace monitoring environments.

But, according to Yao (1997) worked on the consequences of profit sharing and bonuses on the performance of Chinese state businesses and explained that over fifty percent of the value-added development of the industries might bFoyeroyee due bonus payments.

Incentives vs. Results

Hollowell (2005), taking a look at the connection of high-incentive-based official wage contracts with the long-term stable performance learned that firms that contain a robust official compensation aspect display commensurate superior long-term stock-price performance. Finally, Lazear and Oyer (2009) recently gave a synopsis of ramifications of incentives in organizations. They went through many studies that conveyed that incentives can be a very significant managerial instrument for altering individuals' behaviour in a good way. Specifically, productivity can be increased adopting incentives like piece rates. Lazear and Oyer (2009) additionally debated studies which displayed that even nevertheless incentives worked, in a way that they had a good result on outcomes, they didn't work consistently each time and from time to time even had unintentional and unwanted results.

Performance and performance appraisal based reward system

Performance-related rewards permit the highest performer to be awarded accordingly. According to Lyons and Ben-Ora (2002), successful performance-based rewards are those, flawlessly begin, implemented and aligned with total reward strategy. When organizations structure the "reward systems" totally in line with the intent of their workers, it happens to human instinct to work hard to be able to attain their own and organizational objectives (Pfau and Kay, 2002). Among several key element of purchase performance "stock" is reckoned most pertinent and measurable way to relate pay to performance. The only way to improve the Employees motivation and enthusiasm is performance appraisal system especially when efforts directly link with reward through particular and formalised individual objectives (Fay and Thompson, 2001). Seniority, internal equity, performance based incentive plans and traditional pays are highly ranked in Chinese culture. Brown (2008) suggested that evaluating, gauging and developing the efficacy of human resource pay and compensation practices have key possible for the company in a service or knowledge based economy.

Pay and incentives associated with long-term performance.

When characteristics of high performing companies are focussed, Kling (1995) discovered that relating/linking staff wage and incentives to permanent achievements of the entire organisation had a useful relationship with the productivity. Although these findings from the works done years back, in a few companies it still remains the same criteria. While in 2011, Weller and Reidenbach say that, in the event of the recession and financial recovery, a crucial balance between your incentives for the shorter conditions and long haul performance must be achieved as currently corporate managers have strong incentives to attain short term goals than to get on long haul productive techniques. As the study of Weller and Reidenbach is relatively new, this is current in many organisations in today's market. Many managers are assigned incentives based on monthly targeted sales and productivity.

Most importantly Bebchuk and Fried (2010) pointed out that it is the same issue in case there is public sectors as well.

Reward systems that reinforce core values and strategy:

In 1996, according to Montemayor, High performing US companies used different kinds of pay policies where they were always aligned with the overall corporate strategy, as the low performing companies were characterised by having less fit among business strategy and pay policies. Best companies invented and implemented reward system that reinforces the core values and mission of this firm. (Lawler, 2003)

Rewards based on relative performance:

Sometimes rewards derive from relative performance versus competitors. Other form of relative performance is put forward by Guojin et al. (2011), which is rewarding individual`s performance after comparing it with others performances in the same activity.

Group compensation:

During the time of revising the emerging business concepts produced by the best businesses to deal with increasing competitive environment, Hammer (2001), uncovered that these developed companies adopted reward system that focussed on group performance over each individual performance. According if you ask me, this is highly agreeable as many of the successful companies manage to deal competition and achieved high productivity rates through its pay plans. However, Jennings (2002) found all these company`s pay plans were predicated on group productivity-based compensation, which drove and strengthened the culture which increased productivity.

Pay for performance.

According to Bae and Lawler (2000) Korean companies that employed high involvement human resource management (HRM) strategy achieved better outcomes than others which did not follow this type of HRM. The same results were discovered by Challis et al. (2005) and Knight - Turvey (2005) for Australian firms, Kok and Hartog( 2006) for Dutch businesses, chiang (2006) for south Korean firms, and Origo(2009) for Italian manufacturers. US businesses used eight management techniques among which pay for performance is one. These findings are evident among American businesses.

I was working at Microsoft India and have an event of nearly two years. I got working as a customer service representative. I enjoyed doing work for Microsoft and intend to establish an improved career in the same organisation.

Overview of Microsoft India:

Our company, Microsoft is organized and established. The major business areas are serving customers starting from consumers to corporations. Individual but connected, each and every business solely determines its own profits and gains

Microsoft Corporation India Private Limited (MCIPL) is the marketing arm for Microsoft's products in India, set up in 1990. MCIPL is continuing to grow to over 685 employees, across offices in the nine cities of Ahmedabad, Bangalore, Chennai, Hyderabad, Kochi, Kolkata, Mumbai, New Delhi and Pune. We look at the sales and marketing for enterprise, small and mid-market group and consumer segments, via a strong channel network of over 18, 000 members, including over 550 ISVs.

Working for Microsoft:

Working Experience for Employees at Microsoft

Working in Microsoft earns a lot of unique experiences, plus a rewarding career prospect. The business believes in the actual of every individual and their future potential to make anything possible. So, aside from a higher academic record, the business also looks for people who are exceptionally talented and have a passion to achieve the impossible. With its 6 business units in India, you will get a job best suitable to your knowledge and skills, which include product development, researching, providing business support and marketing the products. This company is obviously a unique one and with regular training and performance benefits helps a person to attain his or her career goals. Microsoft India serves as the perfect platform for learning new technologies, research the best solutions, and acquire understanding of emerging market trends. Benefits play an important role in our choice of employer. Microsoft believes that work should be challenging, yet rewarding. It's vital to provide industry-leading benefits to all qualified employees. You start with a competitive salary, bonuses, and stock package benefits, Microsoft is constantly on the reward eligible employees predicated on their individual performance. Anyway these benefits do not visit any level.

Microsoft aims to empower its employees with the resources, compensations, overall flexibility and job security and ensuring its employees live a healthy and balanced life.

It is widely known that, Microsoft is recognised as a respected organisation for providing the strongest and the most comprehensive incentives and benefits package in India. As stated earlier, Microsoft employees start off with competitive wages, bonuses and stock awards based on individual performance levels.

The main area of difference in Microsoft benefit packages in India is that it not offers versatility in working conditions but also the flexibility in benefit packages. So, It is like employees can pick the mix of benefits that best suits them. That is in my own view a great and incredibly challenging approach because each employee has unique benefit needs and to meet that Microsoft offers flexible benefits.

Health and Wellness:

It offers comprehensive and flexible healthcare for its employees and their qualified dependants. In addition, it provides dental and eye care coverage, onsite medical checks, health and fitness center membership reimbursement etc.

Family and parenting

Employee families enjoy a variety of benefits such as maternity leave, paid time off for new moms and dads, and reimbursement of crche fees etc.


provides an employee stock purchase program where they could purchase discounted shares of Microsoft stock.

Giving together:

One more amazing approach is that they match the amount that employees contribute to community affairs like charities and educational institutions up to 50, 000 INR per employee/ year and contribute to causes. It is other ways where Microsoft makes a big change.

Learning and development:

It always believes in constant learning therefore the staff can have got very current KSA`s. It offers over 2000 internal training programs which may either online, virtually, or via class room training. It invests a lot of amount on employee training and development.

Evaluating my previous employer's reward system predicated on the literature conditions done

According to Griffin and Moorhead (2009) common types of rewards to attract and retain qualified employees include base pay, perquisites and awards, performance appraisal, indirect compensation, bonuses etc. Microsoft offers the employees more than all the above types of rewards which means this can be considered as one of the basis because of its success or survival.

Reward system at my previous employer, Microsoft India:

Performance and rewards

It believes in rewards based on the level of performance since it offers wide variety of benefits to the top performers. These top performers is mainly measured based on their innovation at Microsoft as the whole organisation works on the concepts based on technology innovation methods. In addition, it focuses on the employee working tenure as it includes pay rises with respect to the number of years they worked for the company.

This could be understood evidently by the below table obtained from Indian resourcing consultancy called naukri hub

Microsoft employee salaries vary depending on region of the united states or city they reside in. This is basically because of the fact that the price of living varies in India depending upon which city or state you live in. To understand, tables below can be observed

Average Microsoft salaries in India according to Cities:

The median salaries for Microsoft employees in India based on the various cities have been mentioned below

Median Microsoft Salaries according to States:

The median salaries for Microsoft employees in India according to the different states have been the following

Competency Based Pay :

It follows a pay and reward system that is partly dependent after the educational competencies and Qualification as it offers varied wage levels depending on the aboce criteria.

Salary Range by level of academic qualification:

Salary selection of Microsoft employees in line with the levels of academic qualifications have been given below

Academic Qualification

Skill based Pay :

It depends on its employees' skills and it gives different salary packages to individuals based on their skills and section of competence. It is sometimes interrelated with competency based pay and for that reason can't be much differentiated. Different level personnel are paid different pay packages like many other organisations. For example based on their designations this can be considered

Group Rewards:

As it is an IT firm it contains several departments and group projects. So the awards are generally directed at the eligible teams, However there will be a group leader or a department head who indirectly receives extra credit on the list of team.

For instance in the next half of the year I was focusing on a project on one of the top hotel chains of India and we as a team received a deadline of 3 weeks. All of the individuals in the team were assigned a specific job and everyone worked hard and somehow managed to complete our respective tasks in 2 weeks and presented the ultimate presentation in less than enough time allotted to us. At the end of the entire year our group was awarded best group performer award. This rises the motivation levels of all the members of the group but the team leader who contribution was less compared to the associates was awarded the best performer award. This may sometimes have a poor effect on the rest of the group members.

Transparent and fair Appraisal:

As the employees of the business every employee has the to know his/ her contribution to the growth/ performance of the business. Microsoft has a good and transparent approach in its performance analysis and there by ensure fair appraisal is set up. It provides a web portal showing detailed information about each individual's performance over certain period of time. On this portal, it gives a clear picture of how many projects were undertaken by each employee, just how many of them completed on time and how many before deadlines, data about profit through various projects, punctuality of employees, what areas would have to be improved by the personnel, feedbacks, what type of rewards are available etc. So when employees know very well what is expected from them by the business there is way better chance for them to compete and work hard to get the rewards and atleast improve their performance to next levels.

Profit sharing:

This is more related to raised personnel and marketing staff. The marketing and resourcing groups of the company are given incentives and profit sharing benefits predicated on the sales they attain and clients they procure from the market. It is similar for some retail markets where managers have to reach certain sales targets and they'll meet the requirements to increase their bonuses predicated on the profits they bring to the business.

Annual lump sum financial rewards:

This is more of rewarded to almost all of the time employees at my workplace where they are simply deposited with some lump sum payment depending on various aspects like their experience at the business etc. Pretty much, this kind of rewarding also plays a vital role in acquiring and retaining people.

Contributions of rewards in the HR management at Microsoft:

Reward system play a vital role in Human resource department of any business and it is the same in Microsoft as well. Analysts opined that Microsoft is largely successful because of its effective employee retention strategies. Following the global recession crisis there was an elevated responsibility on the shoulders of HR personnel. HR management should be extremely strong and efficient to retain the top employees by providing better compensation and benefit packages.

According to Joe Wilcox (2000) one of the business's representatives, Microsoft is continually exploring ways to ensure the compensation levels are competitive and ensure that the staff are not only recognised because of their work but are appropriately rewarded. According to Ian, General Manager at windows presentation foundation, Microsoft, "It's been new roles, new titles, new challenges yearly roughly. I stopped putting my title on my business cards years ago as it was getting out-of-date so frequently"

Microsoft has been providing stock options at discount to employees since 1986, when it was listed on the stock market. (Barnali Chakraborty, 2010)

Rewards like reimbursement of tuition cost for its employees to gain usage of work related courses is one of the unique approaches raised by Microsoft and is equally benefits the strategic HR management as it boosts the staff's interest for more information and perform more which is eventually beneficial to the overall company performance.

Better the rewards management, better would be the employees' motivation levels to execute more and so Strategic HR is ensured and thereby the organisation's overall strategy.

Therefore Microsoft Corporation received several awards and recognitions and few among are

2008 #1 Best Companies to Be employed by in India - Business Today

2008 #1 Most Preferred Employers in the very best 50 India Engineering Colleges - Economic Times/AC Nielsen

2007 America's Most Admired Companies, Fortune

2009 #1 Great Places to Work with in Ireland ( Microsoft awards and recognition)

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