Evaluate and discuss compensation and motivation practices as they relate to organizational strategy.
One of the key steps in the process of developing compensations and motivations practices is to identify the current level of employee understanding and expectations. Normally this is done with an employee is surveyed through the organizations customized requirements. Therefore, the design and implementation of a performance measurement and compensation system can strongly effect the motivation of the employees.
The compensation system significantly affects other indicators of motivation, namely work satisfaction and turnover intent. Further research could extend these results by investigating the relationship between extrinsic and intrinsic motivation on the one hand and individual and company performance on the other. A thorough understanding of an organizations internal incentive structure is critical to developing a viable theory of the firm, since these incentives determine to a large extent how individuals inside an organization behave.
Compensation and motivation for high performance can be costly especially with each individual not being motivated solely by money. However, it is essential for organizations to strategize considering certain aspects before designing a pay compensation plan to motivate performance. Things such as preference of individual employees, size of pay rewards and methods of motivating job performance should be carefully considered as to what is valid, equitable and acceptable for certain compensation.
The culture of an organization is critical to its effectiveness, hard to profile, and difficult to change. Many organizations have endeavored to change their culture with varying degrees of success. One factor that is often neglected is the influence of the total reward system which includes compensation, non-economic rewards, career opportunities, and other elements. All the elements of an organizations total reward system...