Reward management ( part 2 )

Rewarding People

Min Khaung ( EMPA – 8 )

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TYPES OF REWARDS

• Intrinsic Rewards

• Extrinsic Rewards

Min Khaung ( EMPA - 8 )

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INTRINSIC REWARDS

• Intrinsic rewards may include praise for

completing a project or meeting performance

objectives.

• Other psychological and social forms of

compensation also reflect intrinsic type of

rewards.


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INTRINSIC REWARDS

• A Friendly Place

• There isn’t much Politics Around Here

• You Get a Fair Shake

• Feel Like Family

– A Caring, Nurturing Environment

– A Long Term Commitment

– We are all in it


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EXTRINSIC REWARDS

• Tangible and take both monetary and non-

monetary forms.

• One tangible component - direct compensation,

( Base pay and variable pay )

• Indirect compensation commonly consists of

employee benefits.


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TYPES OF COMPENSATION

• Base Pay - The basic compensation that an employee

receives, usually as a wage or a salary.

• Variable Pay - Another type of direct pay is variable pay,

which is compensation linked directly to individual, team,

or organizational performance

• Benefits - indirect reward for instance, health insurance,

vacation pay, or a retirement pension— given to an

employee or a group of employees for organizational

membership, regard-less of performance.


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PAY

• Pay Leader ?

• Pay Follower ?


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RECOGNIZING EMPLOYEE CONTRIBUTIONS WITH PAY

• Incentive Pay

• Pay for Individual Performance

• Pay for Group Performance

• Pay for Organizational Performance

• Incentive Pay for Executives


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CRITERIA FOR SUCCESS

( 1 ) Individuals should have a clear line of sight

between what they do and what they will get

for doing it.


EFFORT PERFORMANCE RESULT MEASURE PAYMENT

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CRITERIA FOR SUCCESS

( 2 ) Rewards are worth having.

( 3 ) Fair and consistent means are available for

measuring or assessing performance, competence,

contribution or skill.

( 4 ) People must be able to influence their performance

by changing their behavior and developing their

competences and skills.

( 5 ) The reward should follow as closely as possible the

accomplishment that generated it.


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1. INCENTIVE PAY

• The pay plans must be well designed.

• Effective plans meet the following requirements:– Performance measures are linked to the organization’s

goals. – Employees believe they can meet performance

standards. – The organization gives employees the resources they

need to meet their goals.– Employees value the rewards given. – Employees believe the reward system is fair. – The pay plan takes into account that employees may

ignore any goals that are not rewarded.Min Khaung ( EMPA - 8 )

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2. PAY FOR INDIVIDUAL PERFORMANCE

• Piecework rates

– Straight Piecework Plan

– Differential Piece Rates

• Standard hour plans

• Merit pay

• Individual bonuses

• Sales commissions


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3. PAY FOR GROUP PERFORMANCE

• Gain sharing

– Management commitment.

– Need for change or strong commitment to continuous

improvement.

– Management acceptance and encouragement of

employee input.

– High levels of cooperation and interaction.

– Employment security.

– Information sharing on productivity and costs.

– Goal setting. Min Khaung ( EMPA - 8 )

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3. PAY FOR GROUP PERFORMANCE

– Commitment of all involved parties to the process of

change and improvement.

– Performance standard and calculation that employees

understand and consider fair and that is closely related to

managerial objectives.

– Employees who value working in groups.

• Bonus ( Group Bonus )

• Team Awards


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4. PAY FOR ORGANIZATIONAL PERFORMANCE

• Profit Sharing

• Stock Ownership

– Stock Options

– Employee Stock Ownership Plans


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5. INCENTIVE PAY FOR EXECUTIVES

• Short Term Incentives - bonuses based on the

year’s profits, return on investment, or other

measures related to the organization’s goals.

• Long Term Incentives - stock options and stock

purchase plans


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THE ROLE OF EMPLOYEE BENEFITS

• benefits serve functions similar to pay.

• Benefits contribute to attracting, retaining, and

motivating employees.

• Different employees look for different types of

benefits.

• Employers need to communicate effectively so

that the benefits succeed in motivating

employees


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STRATEGIC BENEFITS CONSIDERATION

• Competitive Advantage

• Workforce Attraction & Retention

• Benefit Management & Communication

– Benefit Design

– Benefit Administration

– HR Technology and Benefits

– Benefit Measurement

– Benefit Cost Control

– Communication to Employees


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TYPES OF BENEFIT

• Government Mandated Benefit

• Employer Voluntary Benefit


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GOVERNMENT MANDATED BENEFIT

• Social Security

• Annual Leave, Medical Leave, Maternity Leave

• Gazetted Holiday

• Working Hour

• Overtime Benefit


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SOCIAL SECURITY BENEFIT ( Myanmar )

• Health and Social Care Insurance System:

• Family Assistance Insurance System:

• Invalidity Benefit, Superannuation Pension

Benefit and Survivors’ Benefit Insurance

System:

• Unemployment Benefit Insurance System:

• Other Social Security System:


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EMPLOYER VOLUNTARY BENEFIT

( 1 ) Security Benefit

( 2 ) Health-Care Benefit

( 3 ) Retirement Benefit

( 4 ) Financial Benefit

( 5 ) Family Benefit or Family Oriented Benefit

( 6 ) Time-off Benefit

( 7 ) Miscellaneous Benefit


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( 1 ) SECURITY BENEFIT

– Workers Compensation

– Unemployment Compensation

– Severance Pay


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( 2 ) HEALTH-CARE BENEFIT

• Medical Check up


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( 3 ) RETIREMENT BENEFIT

Non-contributory Plan

Contributory plan

Employee Provident Fund


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( 4 ) FINANCIAL BENEFIT


Insurance

• Health• Life• Disability• Long-term care• Legal

Financial Services

• Credit Union• Purchase

Discount• Thrift/savings

Plans• Financial

Planning• Relocation

Assistance

Educational Assistance

• Tution Aid• Trade Training• Professional

certifications• Learning

Materials

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( 5 ) FAMILY BENEFIT OR FAMILY ORIENTED BENEFIT

• Family & Medical Leave Act ( FMLA )

• Family Care Benefit

• Benefit for Domestic Partner


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( 6 ) TIME-OFF BENEFIT

• Holiday Pay

• Vacation Pay

• Leaves of Absence

• Paid Time-off Plan


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( 7 ) MISCELLANEOUS BENEFITS

• Social & Recreational Benefit


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Thank You

Reward management ( part 2 )

Business

Transcript of Reward management ( part 2 )