May 26, 2011

TOTAL REWARD | Trends in Reward Management

The total reward concept emphasizes the importance of considering all aspects of reward as an integrated and coherent whole. It emerged during the late 1990s as a means of maximizing the combined impact of the whole range of reward initiatives on motivation, commitment and job engagement. It addresses the crucial issues of recruitment, retention and talent management. It has encouraged organizations to consider much more carefully the role of non-financial rewards, including recognition schemes, and to rely less on money as the sole motivator.
This concept encourages organizations to consider their 'employee proposition' in broad terms, taking into account the myriad reasons why people seek to join and stay with them. The traditional elements of reward management such as pay and benefits do, of course, play a part, but total reward considers the impact of other aspects of work too - intangibles such as leadership style and environmental factors such as location and workplace facilities.
In order, therefore, to achieve the much-coveted prize of 'employer of choice', all elements of the employment experience need to be aligned and consistently applied. This requires coordinated management across the organization. For the reward specialist, for example, it means closer understanding and cooperation with colleagues in HR specializing in people development, resourcing and employee relations.
In concert with this more holistic approach to employee motivation is an increasing realization that reward systems must be flexible if they are to motivate effectively the diverse workforce of the 21st century. This may manifest itself at the most basic level through the removal of the bottle of champagne as a universal token of recognition, as it is one that does not take account of the impact on non-drinkers, particularly those who avoid alcohol for religious reasons.


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