Reward,Strategy,what,takes,mot business, insurance Reward Strategy - what it takes to motivate and encourage yo

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Thefirst question to ask is: what motivates people to work?  Why spend time and talent in the service ofan organisation, even if its your own organisation when self-employed?  Because there is some ‘reward’ to do so.  Atface value, people work because they gain an income to spend on theirindividual, family and community needs. Some needs are the essentials of life, what humans needs to survivephysiologically.  Maslow defined thehierarchy of needs with fundamental physiological needs at the base and risingthrough safety, social needs and culminating in the need forself-fulfilment.  Herzberg distinguishedbetween firstly ‘hygiene’ extrinsic factors such as pay and organisation policyand procedures that will cause dissatisfaction in the workplace if absent or insufficient.  Secondly, ‘satisfiers’ which are intrinsicfactors such as the ‘value’ of the work, achievement, recognition,responsibility and potential for growth which will positively motivate people.SinceMaslow and Herzberg were published over 50 years ago, other theories ofmotivation have been developed.  Thesetend to centre on cognitive or process theories – how people think about their‘reward’.  Expectancy theory identifiestwo factors of value and probability. People value reward in terms of how well it satisfies their needs ofsecurity, social esteem, fulfilment and autonomy.  Inevitably people value different elementsdifferently, which suggests reward must include a mix.  Expectancy is the probability that rewarddepends on effort – the more effort, the higher the reward.  For that effort to be helpful to theorganisation, individuals needs to have the appropriate ability and the correctperception of their role.  Thisemphasises the need for clear role definitions and understanding, effectivelearning and development interventions and a link between performance andreward (not necessarily performance related ‘pay’).Twoother theories of motivation are important to consider.  One is goal theory as developed by Latham andLocke which states that both performance and motivation are higher if mutuallyagreed, challenging and monitored goals are set and feedback given onachievements.  The second is EquityTheory which suggests that people are more motivated when they are treatedequitably and demotivated if they receive or perceive inequitabletreatment.  This connects to the‘felt-fair’ concept that pay systems are fair if they are felt to be fair.Extensiveresearch and studies on reward strategy has shown that people are complicatedand motivation is a complex process. What is clear is that while financial reward is important, for mostpeople other factors are also, and can be more, important.  These can be brought together under threesections:Equity – theperception of being treated fairly both in comparison to others and in terms ofthe effort and skills brought to the roleSelf-fulfilment –that people are recognised for what they do and encouraged to reach theirpotential through effective learning and development processes and given feedbackon their performanceOrganisationculture – roles are clear and organisational and personal values are inalignment so that employees engage and enjoy work (as much as is possible)Anotherway to consider the necessary components of rewarding people is to view them asindividuals, within their team, in the organisation and generally in theworkplace:-Recognition –being appreciated, not taken for granted, having a voiceWork/life balance– accepting and encouraging that there is a world beyond the workplaceOrganisationalculture – being able to engage and fit with the organisation in terms of itsvalues and how things are doneEmployeedevelopment – being enabled to develop personal skills and understanding forcurrent and potential future work Environment –having a ‘good place’ to work in terms of physical layout, equipment, healthand safety and security'Total reward’addresses this complexity in bringing together financial aspects of reward ofbasic pay, any bonuses and additional financial benefits with the non-financialbenefits at the personal and organisational level.  This is a helpful concept, especially becauseit acknowledges the limits of purely financial reward and identifies otherareas that can be addressed, in particular when salary budgets are limited foreconomic or values reasons.Dependingon the organisational context and values, not all elements as described in thediagram above will apply.  However itneatly differentiates between financial and non-financial rewards and betweentotal remuneration and total reward.Rewardis more than pay and benefits.  Thereforea reward strategy must consider many aspects of the workplace in order to bothattract and keep high quality people doing the right things in the right way sothat they flourish and the organisation is successful.