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The assignment is about Potential Employee Benefits to boost their morale to improve overall competitive strategy

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Potential Employee Benefits to boost their morale

Determine how innovations in employee benefits can improve the overall competitive compensation strategy of the organization.

An organization can multiple strategic decision to become attractive in the business world. For example, entering into the new market, launching a new product, changing the pricing strategy, changing the promotion policies, recruiting highly talented employees and many more. One of the most effective and highly desired strategies is the innovation on employee benefits that would potentially improve the competitive compensation strategy of the business organization. An effective and innovative employee compensation strategy plays a vital role in the talent of human resources the company hires and retains in the organization (Council 2017).

An effective compensation plan is key for the success of the organization since the compensation is one of the important motivators of human resource. Therefore, business organizations must continuously innovate and introduce new compensation plans to encourage and support the commitment of their employees (Barrett 2017). Some of the most recent compensation strategies used by the corporates are listed below:

             Internet at work for personal reasons

             Allowing employees to use the laptop for their personal work

             Allowing employees to bring their pet to the workplace

             Napping policy

             Sports pool

             Betting places

             Setting up a gaming zone

             Gifting car/laptop for high performers

             Providing advance loans

             Gifting employees on their birthday/wedding anniversary and other special occasions.

             Creating a diversified work culture

             Arranging music nights and live performance

             Free child care

             Work from home options

             Education loans

             Referral bonus

             Random display of appreciation

             Four days week offer

             Team lunch in the place of employee’s choice

             Personality development programs

             Helping employees to pursue their further students.

             Giving enough freedom and empower them to take certain decisions

             Free medical for employee’s families, etc

 

However, one of the serious problems in mid-sized companies is that CEO and top officials have less interest in personal growth and development of employees. This problem is even severe when a business is consistently performing well and not seen the track records of revenue slump. In such conditions, management may show less interest in new reward programs to motivate employees. When the management show less interest, the morale of employees will go down.

An innovative compensation strategy either with monetary or non-monetary benefits will boost employee morale to the new heights which in turn generates positive business results. The positive results in context include reduced attrition rate, retention of genuine talent and productive employees, improved brand image, enhanced job satisfaction, improved productivity, self-driven workforce, etc. a strong reward strategy of the organization may encourage their employees to think in an innovative way to improve the overall results of an organization (HRT 2018). Further, motivating compensation plans will prompt them to put more efforts and feel pride in every small task they perform within the organization. An innovative compensation strategy will attempt to remove the negative perceptions and mindset employees which brings positive results for the organization.

In today’s confrontation for the talented workforce, the value of pay cheque is just a basic need while an individual choice where to work and for whom to work. Millennials are mostly lashing this change, as they look for work-life balance and a socially cognizant corporate culture. The mollycoddled millennial is a truism, but as always there’s some fact to the simplification. One issue smart business paying close attention to is a work-life balance.

American Express offers a comprehensive work-life program to support employees in managing their personal life and work life. The company supports employees to spend good and quality time with their family members (SHRM 2017). The company strongly feels that a happy employee is a productive employee. Human resources recruiter recommending flexy time work modules which is an encouraging factor for many individuals.

How innovative benefits could be tied to specific jobs.

As one of the popular sayings goes “Happy employee is the productive employee” employee satisfaction plays a crucial role in the overall success of the organization. The salary is the basic aspect which attracts and retain the talent. However, the story doesn’t end over there. An effective compensation plan is not a standard template in which an employer can fit everyone. Each employee will different expectations, needs and preferences. There is no scope for ‘one size fits for all’ conditions in the work life. Further, the needs and preferences of employees’ changes over a period (Talkdesk 2017). Age, sex, culture, religion, lifestyle, marital status, region, nature of the job and many things that an employer must consider while designing an effective and innovative compensation plan. Hence, tailoring employee benefits based on specific job role is the need of an hour.

             Child and Eldercare benefits

When a job requires long hours of employee time in the office and the employee is a woman, it is advisable to provide childcare support and elderly care support. A working woman often encounters with the problems in terms of taking care of their babies and parents who have an external dependency for their survival. The conditions will become further worse when it is a single parent for a kid and the dependents are disabled. Under such conditions, the child and elder care benefits are of immense help for working women.

             Additional remuneration

If a job requires additional hours of efforts (beyond 8 hours of duty time) from an employee, it is effective to introduce overtime compensation policy which boosts the motivation level of employee to work for long hours without any negative feelings.

             Flexi timing

When a specific job role doesn’t have a defined timing for employees, it is advisable to go for flex timing and work from home options. An employee need not wait in the office for long hours to perform a job. Further, it may hinder their personal life. If the job can be performed without any worries about the timing, then it is good to assign employees with flexible options.

             Health Insurance

If a specific job role exposes employees to health hazards, it is good to introduce health insurance plans which would take care of the employee during health emergencies. Today’s rising cost of medical treatment is a great cause of concern for every individual.

             Relocation expenses

when a designation within a company demands a relocation, the company can help employee by paying relocation expenses. It may be a percentage of employee salary, flat contribution, reimbursement of expenses incurred etc.

             Educational allowances

When an employee is keen on pursuing studies further, the company may offer the following benefits

             Educational loans

             Offering scholarships

             Leaves with pay

             Offering free books

Often, the studies of employees would be useful for the company in many ways. The company can use their talent within the organization instead of allowing them to fly out of the organization as soon as they finish their higher studies.

Critique the effectiveness of equity-based rewards systems versus those with more creative approaches

In today’s complex business environment, the entrepreneurs are looking out for more innovative means to reward the efforts their employees. The organizations striving hard to get more out of their employees and their employees in response expecting more from their employers.

Equity-linked reward system generally are monetary benefits brings not just a cost pressure, it brings ownership risk. That means, the whenever the company offers equity-linked programs for their employees, the ownership of the company is shared with the employees to the proportion of shares issued (Zundel 2017).

The empirical reports show that equity-based reward system worked well in motivating employees. Some employees experience that ‘owner’ feeling as soon as they acquire company’s share. Along with the ownership, it brings them a strong sense of responsibility to work harder for the success of the company since it is a two-way benefit for an employee. Nevertheless, we can not consider all the employees on the same page. Even after acquiring the shares of a company under equity reward system, the employees have exhibited the same feeling as earlier. That means the equity-linked reward system doesn’t have any impact on the behaviour of some employees. Those employees may sell off their stake since they are interested in cash rather in ownership. This set of employees can be motivated by direct monetary rewards like cash prizes, free air tickets, holiday trips, gifting car, movie tickets etc. These categories of employees weigh the rewards something physical which they can directly experience.

Further, a few employees would expect the company to assume the responsibility of accommodation and health benefits. They see health and accommodation as the motivating factors. There are several incidents reported that merely because the company offers these benefits, employees stick to the company for decades. They may feel the company is for their life and the company itself their life.

Therefore, there is no standard template which helps an entrepreneur to fix every employee into one system. I think both the methods have their own advantages and inherent advantages. It is up to the company to choose the best method based on the vision, mission and objectives of the company. Even today, ESOPs are the best motivating tools in bigger companies. The employees feel pride in having an ownership stake in the business instead of employees who work for the company for a defined salary. Because there is a lot of difference between the behaviour of a typical employee and a typical owner.

 

Discuss the key elements of integrating innovation into a traditional total rewards program

The studies conducted in the area of employee reward program have repeatedly proven that employee engagement is not dependent on a single parameter. Since, the employee engagement is a critical factor in the success of a business, innovative benefits should be added to the package of the incentive plan.  Satisfied and happy customers have reported higher performance than those who have been treated with par. Therefore, new reward components must be added to traditional methods reward programs. Because, a mere increase in salary, bonus and extra pay may not motivate employees to reach an extra mile in their job profiles. Some of the innovative rewards like instant gifts, surprise gifts to their family members, foreign trips to the family members of employees, daycare service to their kids and many more components can be added to motivate employees.

Of course, such inventions also need strong and effective communication between the management and the employees. Otherwise, a huge gap will be created between the offers of the management and what employees expect from their employers. The company must constantly innovate and implement new reward programs which suit the employees at different levels in the organization.

For many years, building a new reward program for the company was a direct exercise conducted by the management in consultation with line managers. However, it may not be a suitable method. It is important to sense the pulse every employee before designing any new incentive and reward programs. The management should connect with every employee personally in order to understand what makes them happy within the company and what is disappointing within the organization.  However, the traditional mindsets have lost their grounds. Most of the well-established companies are now able to sense what is expected from their employees and how far those expectations can be met. The large corporations have given speed and new dimensions for reward programs. They are continuously experimenting by offering rewards at the individual level and group level (INC 2017). Some of the major corporations like DDB, Westin and GAP are implemented a blended model that includes, both individual level and group level rewards to test the effectiveness. Some of the companies are surprising their employees by offering foreign trips.

 

Recommend a process that optimizes an employee-based suggestion program to continually refresh the total rewards of the organization

Developing an employee suggestion program may have a positive impact on the total reward system of an organization.  When an employee is given an opportunity to share his views and take part in designing reward programs for an entire range of designations, the level of morale may go up. Naturally, the employees will have a high level of motivation towards the organization. For example, in 2011-12, British Airways designed an employee suggestion program. The suggestion of one of the employees saved around $7,50,000 a year in fuel cost of the organization (Forbes 2017).

Nevertheless, the company cannot ask employees to share their suggestions and feedback on the existing reward system. There is a procedure through which a company can ask for the suggestions. The reward program designed by the committee in consultation with the employees should be sophisticated and tactful. Else it may hit the brand image of the organization. It is always essential for the company to understand that the employees are the real asset for the organization. The following are some of the most important steps in the process of designing reward programs in consultation with the employees (Forbes 2017).

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Finally, the success of the reward program is dependent on how it is marketed within the organization. Therefore, the company must think like a customer in order to visualize how the employees would respond to the new reward programs. Modern employees want to be challenged and excited and they should feel like they are transforming someone’s lives by performing their duties effectively. This gives them a pleasure and a sense of great gratitude. Therefore, the employee-based suggestion program must consider all these aspects while designing a program for the employees within the organization (Apirian 2017).

It is important to note that, though every company would like to improve the productivity of employees by offering lucrative packages and attractive incentive plans, hardly companies will be able to design effective reward programs. The reason is simple, when a company is performing under huge cost pressure, they may not be able to spare a fund to design an attractive incentive plan. Those companies which are running under loss may not be able to give costly gifts to their employees. Any such plans may further put pressure on the margins and cost factors which impacts the company negatively. Due to extensive competition in the market, most of the companies have been squeezing their margins to retain the customer base and profit margins. Under such conditions, effective monetary reward programs are simply burdened on the companies. Therefore, the companies must be careful while designing their incentive plans. It is always good if the company can spare a portion of their earnings to motivate employees and boost their morale on a continuous basis.


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