Reward Motivation e Reward 4 June 08

7/30/2019 Reward Motivation e Reward 4 June 08

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the institute for employment studies

Motivation and Reward:presentation to e.reward

conference

Peter Reilly


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Agenda

The terms of debate

The importance of motivation

Link between motivation and reward How to develop workforce motivation

through reward


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Words, words, words


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What does motivation deliver?

Higher productivity

Improved customer service

Inputs

Outputs

Lower staff turnover

Better attendance

Improved safety

Beneficial engaged behaviours taking initiative

wanting to develop

organisationally aligned


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Some evidence

Corporate Leadership Council

the most engaged employees perform 20% better

than the average and 87% less likely to leave

Gallup/CIPD

positive health lower sick leave taken

SHRM

better safety performance

Salanova et al. improved customer service

Cohen

lower intention to leave


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LineManagement

CompanyCulture

EmployeeCommitment

Customerspending

intention

Changein sales

Customersatisfaction

with service

Employee

Absence

IES service-profit-chain model


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Service satisfaction chain in government

Confidence in

government

CanadianGovernment

Services

perceived to

be beneficial

Service

quality

Services

perceived to

meet needs


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Employee input to service

CanadianGovernment

Employee

satisfaction/

commitment

Work environment

Fair pay

Perception of managementCareer development

Client

service

satisfaction

Timelinesscompetenc

eCourtesyFairness

Outcome

Citizen trust/confidence ingovernment

Social/cultural factors

Government

performanceService satisfaction

Service benefit

Service adequacy


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Link betweenMotivation and Reward


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The positive impact of reward

Corporate Leadership Council Connecting pay to performance has

the greatest effect on discretionary effort

Guzzo et al. Financial incentives had a greater effect on

commitment than a wide range of motivational

levers: training, work design, etc.

The Work Foundation

The higher proportion of staff getting PRP,

the higher organisational added value


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Pay practice cont.

The WorldatWork PRPs impact on engagement

Improved for 57% among top performers

Improved for 30% for average performers

Improved for 12% for low performersYork University Canada

Those who received performance feedback & linked

reward were more satisfied with pay than those

without an appraisal or PRP not linked to appraisal.IES

Pay and benefits links to employee engagement

in the NHS


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The negative side of poor reward

CIPD top 3 factors leading to work disengagement:1. the way the organisation is managed

2. chances for promotion

3. the pay package

Poor communication of reward

leads to employee dissatisfaction (LeBlanc)

Staff in public sector resent systems that seem

designed for naturally shirking employees (Henry)

Managers key objective is maintain trust and relationships

with staff, so IPRP is operated to maintain equity not

reward high performers (Harris)


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There are other factors

Importance of equity Employees are more concerned with fairness

and equity than with levels of pay (Towers Perrin)

People are uncomfortable about being betterrewarded than others - depending on the social

setting (Adams)

Satisfaction

Organisational commitment was more stronglyrelated to pay satisfaction than to actual income

(Cohen and Gattiker)


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There are other factors, cont

Process Pay fairness (particularly process fairness)

25 times stronger predictor of employee

commitment than pay satisfaction(Compensation Round Table)

Understanding

Pay knowledge is associated withorganisational effectiveness and pay

satisfaction (LeBlanc Group)


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WorldAtWork knowledge of pay model

Pay

amount

Pay

process

Payknowledge

Paysatisfaction

Workengagement


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To sum up

In some circumstances financial rewardscan increase motivation when

its a proxy for value?

its a symbol of competence? pay is low and vital to survival?

its a matter of mutual dependence?

there are no better alternatives? when it is the occupational norm?


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To sum up, cont.

For others financial reward a hygiene factor get it wrong & problems result

Fairness, understanding & satisfaction

(more than level) seem to be important Different reward systems produce different

results, depending upon aims

Merit increase v bonus

Team/group v individual

Incentive v recognition


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What Actions Can You Take?


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Understand your workforce

The cat bringing you

a dead rat as a reward

shows that the catknows nothing of what

interests you

Graham White HR Director

Westminster City Council


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Measure motivation, etc

Gallup Q12

Towers Perrin

Saratoga

Hewitts Valuentis

Hay

ISR

YouGov etc., etc.

Own company approach

The engagement indexSurveys, surveys, surveys


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Understand differences

Personal/job characteristics

age

grade/role/occupation

length of service ethnicity

gender

Work experiences

harassment/bullying/work accidents interactions with managers

(especially appraisal and development)

Individual attitudes

Motivation varies by


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Examine linkages

How does motivation link to: organisational performance/profitability

productivity

quality levels/innovation evidence

customer satisfaction etc resignation rate (and intention to stay)

absence statistics

performance indicators

pay level and size of award (base/bonus)

benefit take up

reward policy change


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Some tools

Total reward


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Total reward includes all types of

reward non-financial as well as

financial, indirect as well as

direct, intrinsic as well as

intrinsic. It is a value proposition

which embraces everything that

people value in the employment

relationship and is developed andimplemented as an integrated and

coherent whole.

Michael Armstrongs definition

of total reward

W ld tW k t t l d &


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attractmotivate

retain

employee

satisfaction&

engagement

business

performance&

results

organisationalculture

businessstrategy

HR strategy

compensation

benefits

work/lifeperformance& recognition

development& career

opportunities

Totalrewardsstrategy

WorldatWorks total reward &

employee engagement model


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Components of total reward

Adaptedfrom Schuster and Zingheim, 2000

Compelling future

Vision/values

Growth/success

Positive brand

Individual growth

Development/training

Career enhancement

Positive workplacePeople focusLeadershipCollegiality

Trust/recognitionInvolvement/openness

Total remunerationBase

Variable

Benefits


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Some tools

Total reward

Flexible benefits

Profit sharing or similar Well designed incentives


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Expectancy theory and pay satisfaction

Source: Ducharme, Singh and Podolsky, York University, CBR, 2005

Expectancy

Reward

ValenceInstrumentality

Performanceevaluation

Goalsetting

Paysatisfaction

Motivation


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Some tools

Total reward Flexible benefits

Profit sharing or similar

Well designed incentives

Non financial recognition

Demonstration of caring,concern and fairness


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thank you

www employment-studies co uk

For further information contact:www.employment-studies.co.ukpeter.reilly@employment-studies.co.uk

Reward Motivation e Reward 4 June 08

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