REWARD SYSTEMS THAT REINFORCES SUCCESS...

Rewards, not Punishment brings out the best from employees and motivates them to be achievers...


Organizations raise resources mainly from 3 different sources: Investors, Employees and Customers.
Employees contribute to their organizations by delivering much more value than what they are paid.
It is imperative for today's organizations to attract right talent at the right price, get the best out of the employees and retain them. Inability to retain good employees will result in not only a gap to be filled, thus losing time and productivity, but also at times result in plugging the positions again by paying much more to new employees. Apart from a negative impact on profitability, this also has an impact on the morale of the rest of the employees who end up feeling that they are being taken for granted and paid lower salaries for being loyal.


'Employees who receive bonuses for their efforts will work even harder, increasing productivity and potentially bolstering profits. But those subjected to penalties tend to distrust the supervisor and, because of that, work less hard' says, Karen Sedatole, associate professor of accounting in Michigan State University’s Broad College of Business who authored the study with Margaret Christ of the University of Georgia and Kristy Towry of Emory University.

Rewards for employees can be for  Individual or Team performance in the form of Financial or Psychological incentives. While the rewards could be offered in the form of an increment or a performance bonus (cash or equivalent), this takes into account, individual or teamwork approach encouraged by the company. 

While most of the companies make the practice of recognizing the employees' contribution program oriented and transactional by offering gifts, certificates and mementoes, exemplary companies encourage the employees through spontaneous programs and special mentions in public that build the self-esteem of the employees and inculcate a sense of feel good and motivation to achieve more, among the employees. Such programs increase the bond of the employees with the organization and encourage them to be ambassadors of the company.

Employees value the recognition given by the organizations in the form of awards, promotions, special mentions in public in addition to the certificates and mementoes that go with them.

Successful organizations use a right mix of transactional and relational recognition programs.

Transparency in reward and recognition is the most important aspect of the programs at companies known for being the best places to work at.

Companies like Citibank, Unilever, Procter and Gamble, Cisco Systems, IBM, Infosys Technologies, Wipro, Tatas, Bharti Airtel, Idea, Godrej etc. enjoy some of the lowest employee turnovers as they encourage, recognise and reward brilliance at work places and also keep the employees charged up consistently by giving them challenging roles that match their competencies. Training programs, employee competence programs and job rotation globally, make these companies great places to work for.

Transparent, fair and performance oriented reward systems that take into account both financial and psychological angles, in tune with the organizational culture and professional HR Practices are the hallmarks of Successful Organizations. This is what, that motivates the employees to stick to their organizations and give their best, consistently for life.