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KENSINGTON COLLEGE OF BUSINESS

Employees appraisal and

rewardIn Public Limited CompanyNahid Mohsen Pour

3/3/2011

Words Number: 3630

Without letter, references, content and cover


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Table of ContentsEXECUTIVE SUMMERY ............................................................................................................................ 3

Introduction............................................................................................................................................. 3

Purpose of this paper........................................................................................................................... 3

The case study..................................................................................................................................... 3

Recruitment ........................................................................................................................................ 3

Selection.............................................................................................................................................. 3

Performance Management .................................................................................................................. 3

Appraisal ............................................................................................................................................. 4

Reward system .................................................................................................................................... 4

Job satisfaction.................................................................................................................................... 4

Mentally stimulating job ................................................................................................................. 4

Counterbalanced and fair rewards................................................................................................... 4

Supportive occupation colleagues and condition ............................................................................ 5

Employee`s genetic nature .............................................................................................................. 5

Discussion of the Issue ........................................................................................................................ 5

The philosophy new Pay ................................................................................................................. 5

Expectancy Theory: Money and Motivation ...................................................................................... 6

Equity Theory ..................................................................................................................................... 6

Establishing identical of payment ....................................................................................................... 7

Management Motivation ..................................................................................................................... 8

Executive Manager Motivation........................................................................................................... 8

Middle Director Motivation ................................................................................................................ 8

Lower Level Motivation ..................................................................................................................... 8

Methodology ........................................................................................................................................... 9

Evaluation ............................................................................................................................................... 9

Front line worker (Ismail) ................................................................................................................... 9

Middle director (Suneeta) ................................................................................................................. 10

Executive Manager (Imelda)............................................................................................................. 10

Conclusion ........................................................................................................................................ 10

Recommendations ................................................................................................................................ 11

References ............................................................................................................................................ 12


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EXECUTIVE SUMMERY

Recruitment, selection, performance, appraisal and reward are important processes in human

resource. Rewards system is known as a key factor by a brief review in the literature by

theorists and academics. Also job satisfaction is another crucial factor to provide individual at

all level satisfaction, achievement and occupation importance. More over this feeling cancreate productive personals with more effectiveness and loyalty for the organisation while

they are trying to gain competitive advantages. The aim of this study is explaining main

factors in human resources with a suitable correlative to reward system by theories and

methods in the recent journal articles and books. In this study main focus is one the three

hierarchical levels of employees in the PLC and find out solution by a suitable rewards

system relevant to its role.

Introduction

Job satisfaction, motivations, performance management, appraisal and rewards could beconsider as the crucial subjects in human resources to find out and a complete understanding

of different processes, methods, theories and essentials in this part of organisations which is a

prepared in three parts: purpose, case study, terminology as the parts of introduction for a

better clarifying for this paper.

Purpose of this paper

The purpose of this report understands rewards system related to appraisal and performance

in the PLC employees in United Kingdom and to probe about the case study and to solve

problem within this company by the relevant methods.

Recently there is an attention to the key factor successfulness and objects achievement by

creating job satisfaction and appreciate intricacy motivation in two its general models (Lieke

L.Claartje L. ter Hoeven, 2011) at work and gaining employees` commitment.

The case study

The main aim is to find about reward system has impact on job satisfaction within the three

levels of a PLC in United Kingdom. In this case study consider to solve problems in these

three levels [lower level (Ismail), middle management (Suneeta), senior executive (Imelda)]

about their job satisfaction by the financial and non-financial rewards and which models of

rewards can motivate them.

Recruitment

It is a process that describes and invites a proper applicant. (Helen Verhoeven, January 2009)

SelectionThe manner of finding and assessing information about an individual in order to reach an

employment offer (Gatewood, 2008).

Performance Management

It is an advanced manner of describing, measuring, and improving the performance of

individuals and teams and aligning it with the strategic goals of the firm. (PIERCE, 2007)


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Appraisal

The basic purpose of performance appraisal has been to prepare a useful feedback to

personals so that they can develop their performance. (Peretz, 2008) It has eight suitable

methods: Personal appraisal, 360 degree appraisal, self appraisal, Competence assessment,objective setting, performance related to pay, Coaching, Personal improving plan. (Peretz,

2008)

Reward system

Rewards management is the one of processes in the human resources that is developed,

underpinned practically, academically and known as a SoftVariantfor human nature inthe subject. (Ekaterini Galanou, 2011)

Job satisfaction

There is necessary to consider job satisfaction and the amount related to financial or non

financial rewards. Job satisfaction is an understanding formulated akin to motivations and job

behaviour theories (Cleal, 2011) According Freeman study the main subject concern to job

satisfaction is that they related on the objectivecircumstances in which a person in theorganisation is located and either on the one`s psychological conditions. (Freeman, 1978)

(Cleal, 2011) A general and famous model of job satisfaction was established by Herzberg

1959 (Cleal, 2011)he found that some occupation elements could only produce dissatisfactionor short lasting motivation while the other elements could implement long term positive

experience towards the occupation. Robbins (1998) states there are six important job related

elements providing job satisfaction: supportive occupation colleagues, counterbalanced and

fair rewards, mentally stimulating job, supportive occupation conditions, individuality and

the person`s genetic nature. (Ekaterini Galanou, 2011)

Mentally stimulating job

There is clearly connected to job satisfaction. These types of occupations create a suitable

space to employees to exercise their proficiency and talent into a variety of assignments and

also arrange a feedback system on their performance after they complete their assignment or

projects. According Maslow`s theory (1954) individuals in the organisations with stimulatingoccupations their higher level need of self actualization are fulfilled with this chance to this

higher level and can complete their self fulfilment. (Ekaterini Galanou, 2011)

Counterbalanced and fair rewards

There is (Beer, 1984) another job connected element that influent on job satisfaction.

(Pearson, 2009)Staffs are satisfied while they perceive the rewards that they receive from

their occupation correlated to their proficiency and attempts. It is not only about the total

financial reward they receive. Equal rewards in compare to their colleagues with the same

proficiency and attempts and also a fair treated in the work environment has a huge affection

on the employees satisfaction. Equity theory states (Pearson, 2009) recognizing acounterbalance and the fairly rewards to conduct to more job satisfaction and administrative

responsibilities.


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Supportive occupation colleagues and condition

This is another positive correlated element to jab satisfaction. Employees always spend a lot

of their daily time with their colleagues for this reason their colleagues are a part of their

daily lives. Supportive and kindly behaviour betweencolleagues in the work spaceincrease

an employee`sjobsatisfaction. (Millicent Nelson, 2009)This view seems to be relatedMaslow`s Theory (1954) that refers the majority of organisation staff prefer to satisfy their

affiliation needs. (Ekaterini Galanou, 2011) In addition according research have presented

that employee satisfaction is raised as the immediate manager is friendly and sympathetic,

appreciation performing for a good performance, a good listener to the staffs` ideas and

appears a personal enthusiasm to them. (Millicent Nelson, 2009)

Employee`s personality

When an employee personality is fitted to the job that s/he is acting, then her or his job

satisfaction will enhance. John Holland`s personality job adapted theory refers to a directcorrespondent between an employee`s personality characteristics and her or his occupation

climate. (Robbins, 1998) (Chuang, 2010)

Employee`s genetic nature

That is another effective element on job satisfaction. Research on job satisfaction shows an

important part of some person`s satisfaction is published genetically. (Ekaterini Galanou,

2011) That is a person`s mind set towards life positive or negative is provided by his or her

hereditary nature, holds her or him in extra time, goes on with his or her mind set to the job.

(Robbins, 1998) the main intend of this theory is ,that there are some people in the work

place who have negative inner idea to the job while rewards, job conditions and benefitcannot change it. (Ekaterini Galanou, 2011) Therefore managers cannot change the attitude of

this kinds of personals, instead they must be careful on the selection employees process to

prevent of such situations happening at work. More over as well as managers are involvement

they are concentrated on training, work improvement, methods and levels of payment and

framework within organisation, regards to acceptance that these elements caused a positive

changes in the feeling, idea and the personal behaviour. (Ekaterini Galanou, 2011)

Discussion of the Issue

The Management of reward system is the one of high level challenges for general managers

(Beer, 1984). In fact there is a huge gap and conflicts between reality implementation and

theories. It seems there is a close connection in implementation and theories for this reason

they are essential subjects in two different direction means in practical and academic.

The philosophy new Pay

Recently there is a huge change in global and local markets with an intensive competition in

global markets, capital transportability, technological innovations and shifts within business

relations models. Due to achieve in competitive advantages at this time, organisations have

designed new high performance job systems (Ekaterini Galanou, 2011) According to this

notion, there are a connections of rewards with the total strategy. The first discussion existsbetween managers and theorists about the path towards rewards management (Jody Hoffer

Gittell, 2009).New pay states by Lawler (1995) pointed out to perform and consider


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rewards strategically for this reason firms` objectives and policies strongly and precisely

explained and weighed then the design of a reward system will be match to these objectives.

Smith (1992) stated a reverse perspective which discussed about the new payment system

produced to cover the needs of the firms for temporary recruitment and maintenance issues,

stresses due to reduction in the expenses and another matters in company with the highly

competitive global markets (Ekaterini Galanou, 2011). Also he stated that the reward systems

without any changes, stands close to the traditional payment systems for this reason,

managers do not consider of the strategic paths for this model. In fact in thereality there isnot any practical reward performed regards to this new philosophy. (Ekaterini Galanou, 2011)

Expectancy Theory: Money and Motivation

It has a closer meaning to job satisfaction and find out which types of staff are motivated by

money. According this theory, money is the key factor to motivate the most of people and it

can lead to a special orientation (Hesketh, 2008) (Thorpe, 2000) the expectancy theory states

the reason for extrinsic motivation performs in the relation between attempts and rewardswhich is understandable and the amount of rewards is worth the attempt (Ekaterini Galanou,

2011) Also it explains the reasons for more powerful intrinsic motivation( tasks,

performance) than extrinsic motivation. This Theory hasconsidered as a good practicallypath for increasing performance related pay in all its models. In theory have important

advantages as attracting, maintaining qualified staff, developing person and firms

performance, developing motivation and job satisfaction and connecting staff to the firms`

objectives. (Thorpe, 2000) Due to the introduction of various attitudes and departure which

the reward systems related to it completely the cultures and strategies within organisations,

can impact on crucial elements of job satisfaction. (Ekaterini Galanou, 2011) Non financial

motivator as recognition which is the one of strongly motivators and appreciation must be

considered suitably. A reverse idea that it could be create opposition and disagreement in the

job environment (Thorpe, 2000) (Ekaterini Galanou, 2011) there is an argue that this type of

payments as a kind of support of gender inequality (Ekaterini Galanou, 2011) by the effective

design systems difficulties are more achievable and easy to answer. Kohn (1993) shows that

pay as an incentives schemes is not a good motivator for this reason cannot long time

development in the personal yield and in the other hand it could have negative impact on

personal motivation and organisational performance. (Ekaterini Galanou, 2011) According

Herzberg showed in 1964; pay as a motivator is a cleanliness element and it can create

dissatisfaction whereas it cannot satisfy or motivate. (Ekaterini Galanou, 2011) Payment is a

good instrument for management control and it is a critically point for the managers.

(Hesketh, 2008)Another disagreement discussion about incentive plans are they could cause

in a short time personal growth and it can create an extreme competition within the members

of a team rather than participation. In addition Kohan (1993) showed that payments can

intimidate creativity and innovation thinking when employees are concentrated on the

especial function. (Ekaterini Galanou, 2011)

Equity Theory

It consists of outstanding subjects akin performance reward, fairness assessment and equalvaluation. Also he mentioned that interest to the payment is less than equity within

organisations, which conclude to satisfaction. Equity seldom considered and generally

employees respond to inequity by reduction their personal attempts, asking a fair behaviour


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and finally seeking to find another position job. (Adams,1963) (Ekaterini Galanou, 2011)

(Pearson, 2009) More over The lower level of commitment, higher level of truancy is due to

inequity treatment in rewards systems in the organisations and at the end to a worse firms`

performance. Firms with better rewards system and payment are more effective than the other

competitors with less pay. Higher payments appeals and maintain qualify individuals and the

most motivated characters to the organisation for competitive strategies rely on innovation,

quality and price. (Preffer, 1998) (Bruns, 2008) Wood (1996) showed group payments are a

better motivator rather than personal performance. (Ekaterini Galanou, 2011)

Establishing identical of payment

There are two ways of establishing identical payment. (Thorpe, 2000) External and Internal

equity: The first way is to pay every one close to the labor market rate with a comprise with

other staff`s payment in the other firms as External equity (Luis R. Gomez-Mejia, 2010).(Ekaterini Galanou, 2011) Internal equity is regards to the firms` goals and designing a

reward system related to the firm`s objectives and attention to the work assessment between

employees in the same firm (Luis R. Gomez-Mejia, 2010).


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Management Motivation

Executive Manager Motivation

According to human capital theory (Dr Jyotirmayee Choudhury, 2010) some times top

manager do not feel satisfy in spite of they have a significant payment and financial offer and

bonus. Regard to this subject it is very helpful to recognise which type of rewards create to

their inner job satisfaction. (Ekaterini Galanou, 2011)According to Patton (1961) one of the

elements of in the motivation subject is called the nature of proficiency and the challenged

each employee find in her/his job. (Ekaterini Galanou, 2011) In order to maximise the

motivation due to job challenge a top manager is necessary to know about his/her importance

, mastery power in the firm and the quality of his/her occupation. (Dr Jyotirmayee

Choudhury, 2010) Patton (1961) refers to the rating means a position and ranking that an

employee has in the firm and it is a strong executive motivation for top managers than the

financial rewards. (Dr Jyotirmayee Choudhury, 2010)and the one of most powerful executive

motivation is to gain to the power of leadership.

Middle Director Motivation

According to Van Gills (1997), Bloom and Reneen (2010) regards to Capital agent theory,

middle managers place within a firm in the middle of the top and the bottom as the

workforce. Their duties are shifting organisational objectives into targets, performs,

forwarding information to the top or to the bottom of the firm. (Ekaterini Galanou, 2011)

Different researches show that the middle directors are related to the business overview and

their occupation improvement as the most notable of two motivations. (Ekaterini Galanou,

2011) (Reenen, 2010) According to the study of Warwick University Paper (1995) showed

the major of middle directors have commitment to their firms because of their fear more than

satisfying job improvement and an arranged plan. (Ekaterini Galanou, 2011)There is a

consideration about their amounts of pay with a competition by regarding market rate.

(Reenen, 2010) The research shows the important elements for the middle directors are the

relevance, equity, perfection of acting connected to reward system and their willing to

participate in the policy pay establishment. (Ekaterini Galanou, 2011)

Lower Level Motivation

According Armstrong& Murlis, 1998 showed that staff at the lower level seldom motivated

by financial rewards and it seems their maximise motivation is concern to non financial

understanding (Ekaterini Galanou, 2011) like respect and consideration from their

supervisors. According Tournament theory (Miller, 12-30-2008) as a match of Human capital

theory can design a new reward system regards to the new performance rely on the relevant

of organisation objective by arranging different tasks, engagement in the role as an important

part of performance targets with deadlines and according job contract and emotional and

psychological impact can motivate easily the lower level staff by their employer with respect

and support. (Miller, 12-30-2008)


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Methodology

This report is an assignment to design a new reward system in three organisational positions

as receptionist Ismail, middle manager suneeta and executive manager Imelda based on the

case study which is arranged according case study by Ekaterini Galanou1, Georgios

Georgakopoulos, Ioannis Sotiropoulos, Vasilopoulos Dimitris with title The effect of reward

system on job satisfaction in an organizational chart of four hierarchical levels: a qualitativestudy

The resources are renewed and used of new reports as the reports study.

Evaluation

There are three categories for this discussion in three different levels of the firm: front line

worker as a receptionist named Ismail, middle director as an account manager named Suneeta

and an Executive manager named Imelda.

Front line worker (Ismail)The most of them are not fulfil by money and they prefer understanding, support and respect

by their direct supervisorsin spite of financial rewards. (Ekaterini Galanou, 2011)Accordingto the theories and frame work, analysing for this role is necessary recruitment this level

always is by line managers (Ekaterini Galanou, 2011) and for the recruitment the relevant

manager did not consider job description and the relevant skills related to the job position

then this part must again redesign and the criteria of the recruitment must consider precisely

in this part of human resources because of expense nature in the part of Human resources

(Caldwell, 2010) and regards to the purpose in the selection for this role, they did not

consider competency framework as a part of this process for this reason this reception(Ismail)

is not qualified for his role and this point must consider (Caldwell, 2010). Regards to the UK

current legal and EU law act 1972 the contract of employment this reception might be

prepared according Regulatory role refer to employment rights act 1996 under equal

treatment is directed and he is entitle to the all of employment rights in UK laws and rules

under European Court. (Directgov, 2011) According to the performance management theories

seems necessary (Aguinis, 2009) to use of personal development plans in the list of current

features as a type of appraisal and personal training for this person Ismail encourage him to

attain a relevant qualification like receptionist certificate is suitable or with self appraisal

method can increase his motivation by his supervisor (Aguinis, 2009). It seems necessary

according tournament theory (Miller, 12-30-2008)match with human capital theory regards to

Executive manager arrange a good rewards system for both of them because there is this

hazard that Ismail loss his motivation without Imelda rewards and a good payment as a good

perspective job (Dr Jyotirmayee Choudhury, 2010) for Ismail correlation between two

organisational position is interesting regards to the both of theories which is explained in the

section related to Executive management. For this reason a challenging task should consider

for him in a specific deadline with a suitable support, respect and the importance of his role in

the firm should be mentioned by his supervisor (Miller, 12-30-2008). It is possible according

his performance and considers the all of aspects of his performance recognise him for a better

position like sale assistant or....Dysfunctional behaviour refer to him can be happened isMisrepresentation as fraud and creative accounting due to his lack of motivation because of

direct relation between both of their rewards system. If Imelda omits her bonus, it would have


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a negative impact on the organisation directly to Ismail. There is a hazard to destroy his

feature job perspective then this omit creates dysfunction within firm.

Middle director (Suneeta)

According to study shows that they prefer to connect to the top level of managers as theirexpectation of their role and their power. (Reenen, 2010)They have their own targets and

time table. (Ekaterini Galanou, 2011) according to Capital agent theory they prefer to have

personal development rather than financial rewards with fear feeling of their position then it

is necessary to arrange for Suneeta be sent to coaching or mentoring training course as a

appraisal methods in the current features models of performance management and by this

arrangement increased her motivation and improved her job perspective between her

colleagues and family. If she has faced with Imelda omission and Ismail with no motivation,

it would change her to a position that she does not like any risk then she has no innovation in

her position. The best reward for her is training and creating motivation by it in her

emotionally.

Executive Manager (Imelda)

According her recruitment and selection, these processes are acting very well but first of all

seems her job contract must assess because of her perform about rewards, there is a danger

inside of firm in gender discrimination laws that she can complain against firm, then it should

consider (Directgov, 2011). Also her perform based on cutting her own bonus is not ethical

while this act is going to destroy human resources motivation according human capital theory

(Dr Jyotirmayee Choudhury, 2010) and tournament theory (Miller, 12-30-2008) with a direct

correlation and it would caused a lot of problems within organisation. Regards to currentfeatures of performance management method self appraisal and 360 degree appraisal is

helpful for increasing her motivation and considering financial rewards based on

organisational objectives is suitable to renew her motivation. (Cleal, 2011) There is a

probable of dysfunctional behaviour based on her bonus cutting as gaming to more force on

firms` staff specially middle manager to achieve the best position in the market to avoid of

this problem to design a suitable a reward system is the best way of decrease effectiveness in

the organisation. (Dr Jyotirmayee Choudhury, 2010)

Conclusion

There is a big disorder functional within this organisation and in the absence of a human

resource department can be the base of many difficulties inside of a firm with a growing rate.

(Beer, 1984) In this case study is clear no trustful personals and formal procedure in order to

absence of a suitable recruitment, selection, performance, appraisal, and reward processes in

this PLC. (Cleal, 2011)


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Recommendations

It seems the reception`s motivation will be increased by: training ,more responsibilityin deadline, cognition, support and respect by his supervisor

It seems middle manager Suneeta`s motivation will be increased by :training in thecoaching and monitoring, participation in the part of strategy policy, more connection

with executive manager and increasing her dignity

It seems executive manager Imelda`s motivation will be increased by: financial andnon financial rewards


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