Introduction:
Once you enter the world of HR and HRM you start to be amazed how interesting and extraordinary it is and to me it is like a magic stick that you only need to find and learn the magic words and whisper them in your ears to get to what you aim for. As I have been reading and learning HRM and writing blogs about it, I have noticed the reward management is one of the most important keys for organisations to succeed also I have realised most large and successful firms are applying a total reward in terms of HR strategies, policies and practices. I also, think recruitment and how to attract and choose the right people is important too but what guarantees the employees engagement, commitment, motivation, and their contribution (to succeed and achieve the organisation’s business goals and objectives) is the rewarding system.
For example; Colt believes that talented and motivated people make a difference, Colt is willing to offer rewards and compensation and benefits package that rewards people for their contribution to the success of the company. This is why it got my attention willing to learn more about it. The reward management is shaped of three levels 1) Financial rewarding 2) Non-financial rewarding and 3) Total rewards which contains financial and non-financial rewarding. So, I realised total rewards is the main key of reward management otherwise why large organizations like IBM would choose and apply it. Having said that, there are many argues and debates saying total management is easy in content but not in practice. I, therefore, would want to study it more in deep details and I am sharing the study with you.
Digging into the Total Rewards Framework to see how it works:
Firstly, what is the concept of total reward?
Total rewards containing diverse perspectives of reward such as; base pay, contingent pay, employee benefits, and non-financial rewards and includes intrinsic rewards from the work itself which are chained and linked together as an integrated and sticky collected.
According to Wright (2019) total rewards refers to the tools and benefits that a company may use or engage to attract, motivate and retain employees. A typical total rewards program includes five components: salary and overall compensation; benefits; training, development and advancement opportunities; work-life balance and flexible schedules; and rewards and recognition. These programs play a crucial role in engaging potential and current employees, maintaining high employee morale and retaining employees.
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The concept of total rewards demonstrates an approximate to reward management that focuses on all perspectives of value to employees not only few of them like pay and employee benefits. A total reward emphasizes on getting the financial rewards right. However, it appreciates the fundamentality of providing people with rewarding experiences that arise from work environment.
On the contrary, employers have sticking to the verbiage of total reward strategies, pretending for the past 20 years to replace inflexible, paternalistic leadership, fixed-cost-focus rewards with marvellous business and employee driven flexible packages. In reality but, many are just following market practices and in the United Kingdom, looking for tax and NI contribution savings. Brown (2019) argued that the boardroom and recruitment website has never met the total reward on shop floor reality. the practical and actions never met the policy intent. In reality, just the concept is used like trade union often alleged, decent pay levels and increases alternatively cut pensions and benefit costs and shift risks from employers to employees.
Criticisms on Total Rewards:
Work (2000) said, total rewards is simple in concept but is complex in practice. The extent to which is being applied by organizations in practice can be questioned. According to Brown (2017), the concept and terminology of total reward is becoming meaningless in our post-recessionary economy of rigor and inequality. It is generic and unwisely thinking application in uniform packages risks are separating the rewards into an administrative marsh. Wright (2019)says, total rewards may leg the market because of budgetary constraints.
Conclusion:
By having a better understanding of total rewards concept and the criticisms on the tool, in my opinion total management is suitable for large organizations that can afford the rewards costs as budgetary constraints extremely fundamental and essential. Therefore, total rewards is not suitable for small business that financially cannot afford the rewards costs. Secondly, according to Work (2000) and Brown (2017), in terms of total reward practice must be implemented and performed accurately otherwise it will be just a waste of time and money for the organizations. I believe, what is very essential and necessary for the large businesses is to employ the talented and well-educated HR managers who have great personality and self-steams as well as motive with big aims for their future. Because these types of people are reliable and trustworthy who will reinforce the performances to leaded to the organization’s business objectives.
References:
Wright T (2019) Azcentral: The Disadvantages of Total Rewards Program. Available at:https://yourbusiness.azcentral.com/disadvantages-total-rewards-program-27021.html
Armstrong M (2008) How to manage people: creating success. 2nd edt. Kogan Page: London.
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