Talent and talent management is a complex area for HR practitioners

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HRM 5985 – Assessment Two

Rewards to Retention

 

Introduction

 

Para 1: What are talented workers, why is it important to retain them – finish with a sentence to link to monetary rewards

Talent and talent management is a complex area for HR practitioners and organisations alike, the attributes required in one company may be dissimilar to that of another, so when identifying talent and more important for this discussion, talent employees, we consider the McKinsey study where the phase “war for talent” was highlighted “as a strategic business challenge and critical driver of corporate performance” identifying  retaining leadership talent requires sound practices in attracting, developing, engaging and thus retaining highly talented leaders. With the current multifaceted movement to globalization and technology advancements, organisations are recognizing that significant advancements cannot be actioned in isolation of talented employees, in fact high performing employees can offer solutions, continuous improvements, motivation, knowledge and active engagement, all attributes crucial to success. Therefore, it can be argued organisations must keep the best people who are aligned most closely with the organizations core competencies retained in the organisation, thus enabling future success. A view supported by PWC, who, in their 18th Annual Global CEO Survey found that 61% of CEOs saw retention of skills and talent as a key issue over the next five years.  There are, however opponents to the “war of talent” model and state too much emphasis is placed on only talented employees being required for success and that good, solid employees hold no place. In 2001 Stanford professor, Jeffrey Pfeffer, debunked the war metaphor when he wrote that it “sets up competitive, zero-sum dynamics that make internal learning and knowledge transfer difficult, creating an attitude of arrogance and not of wisdom.” Notwithstanding the contrasting views, what is universally accepted is that there is a financial cost, intellectual cost and intangible cost of energy and drive when talent leave the business.   So how do companies retain talented employees?

Para 2: What are monetary rewards, what has been the perspective on monetary rewards in the past/still holds true-ish today? Finish with a sentence suggesting that this isn’t enough to retain the current employee 

Meeting an individual’s needs regarding Total Reward Package is one of, if not, the most challenging role of HR. Whilst one can benchmark pay rates and legal requirements, aligning a reward management system to deliver competitive advantage by way of retaining highly regarded employees may seem inexecutable. Reward compensation is multi layered and complex in nature. Extensive research has detailed extrinsic rewards covering financial, developmental and social rewards, by contract intrinsic rewards identifying job purpose / satisfaction, ability to influence, and perceived importance of role within the business. Depending on research considered, one may seem more relevant, ……..

….. purport’s that such rewards have limited ability to influence or motivate employee’s and it is intrinsic, that is job purpose and ability to influence that have a greater impact. Such theory is not without its flaws, as the desire to place greater emphasis on intrinsic rewards is naïve and impractical for companies to action, particularly if focused on talented employee’s only. A possible by-product of a talent-focused centric reward system is a divisive, conflict-ridden workforce as suggested by …….

 

However, Cameron and Pierce (1997) argue that intrinsic and extrinsic motivation combine to achieve on overall motivational force.

 

 

 

Monetary reward can be undervalued ……… globalization……the expectation on HR to deliver

The importance of money as a motivator has been consistently downplayed by most behavioral scientists like Herzberg who point out the value of challenging jobs, feedback, cohesive work teams and other nonmonetary factors as stimulants to motivation. However, money is the crucial incentive to work motivation because it is the vehicle by which employees can purchase the numerous need-satisfying things they desire (Robbins et al. 2003). Researches reaffirm that for the vast majority of the workforce, regular pay is absolutely necessary in order to meet basic physiological and safety needs, hence, lower level employees are caught in the trap. Furthermore, money also performs the function of a scorecard by which employees asses the value that the organization places on their services, hence an element of being a valuable assert in the organization results in personal motivation resulting in money having a positive impact on motivation (Langton and Robbins 2007). Armstrong (2007) also point out that rewards can act as a goal that employees generally strive for, and as an instrument which provides valued outcomes. It is also a symbol which indicates the recipient’s value to the organization and can act as a general reinforcer because it is associated with valued feedback (Langton and Robbins 2007). Many organizations face problems when trying to understand the relationship that exists between rewards and motivation, however, Langton and Robbins (2007) argued that for rewards to motivate an individual certain conditions must be met, that is, the type of reward must be important to an individual and should be perceived as a direct reward for performance; if it is money, the marginal amount should be perceived by the individual as being significant, therefore, for money to motivate, the marginal difference in pay increases between a high performer and an average performer or a high skilled and a low skilled should be significant

For a company to meet or exceed is to suggest they need to meet each individual’s satisfaction.  Hence the need for companies to understand and critically analyses what is the equilibrium for employee and employers to ensure re

Further, studies involving ……….show that reward management systems can be a minefield to navigate, therefore in the fight to retain talent, companies need to be progressive and look to offer creative employment conditions.

…whereas …..states that a combination or integration of extrinsic and intrinsic will yield better results.  ……….. To place greater emphasis on intrinsic rewards.

Cameron and Pierce (1997) argue that intrinsic and extrinsic motivation combine to achieve on overall motivational force.

TALENT…..

Integrated / hybrid approach

Para 3: Work/life balance, what recent research has shown, how it is beneficial in retaining talented workers and one line about how it differs/is better than monetary rewards

Research in the last decade has shown a trend to work / life balance…….surveys conducted by ….. show over …..% list flexibility and balance as their main driver. Whilst this result does not reflect high performers only, it does indicate the move towards an accommodating work environment.

 

Intellectual capital….

 

Para 4: Career development, what recent research has shown, how it is beneficial in retaining talented workers and one line about how it differs/is better than monetary rewards

 

Para 5: A short paragraph giving your final stance on the topic. I.e. Based on the findings above one can come to the conclusion that monetary gains is insufficent to retain talented workers. Such workers are sought after and require more than a competitive salary to ensure their loyalty etc.

 

Conclusion

 

 

 

 

Points

HR walking a tightrope trying to meet the needs of employees aka individual stakeholders.

 

Intrinsic /Extrinsic requirements.

Surveys showing Career development – flexibility work / life balance. Job title….

Performance reward systems / based pay and bonus incentives…

No one size fits all so understanding employee needs and what motivates them will provide a good platform for success.

Culture can effect employee needs so globalization has further complicated the compensation argument.

Economy can also affect employee expectations of monetary rewards.

A reward system has four primary objectives:

To attract (buy) the right people at the right time for the right jobs, tasks or roles

To retain the best people by satisfying their work related needs and aspirations thus rewarding their contributions.

Develop (build) the required workforce capabilities by recognizing and rewarding employees actions, to enhance their knowledge skills and ability.

To motivate employees to perform to the best of their ability by recognizing and rewarding high individual and group contributions meeting the organisations strategic objectives……

Secondary objectives:

Need-fulling

Equitable

Legal

Affordable

Cost-effective

Strategically aligned

 

Conflict can arise due to individual drivers that may not align with company objectives. Perception can be that working hard should result in company success….not always the case…financial collapse of 2008.

Extrinsic –

Financial rewards

Developmental rewards – personal development, training and career growth and potential, mentoring.

Social rewards – status, work / life balance, validation

Financial rewards – base pay – benefits (super / health insurance) and performance related pay plans (bonuses / incentives).

Pay is important however research shows it does not alone, influence employee attitudes, behaviours and effort.

Intrinsic – content of the job, job satisfaction, task variety and autonomy….…….self-satisfaction

Mention performance – related rewards,  “many commenters contend that extrinsic rewards in general, and performance-related pay in particular are the most powerful motivators (page 216)

Whilst many companies embrace the harward model of HRM, this would imply the company needs to meet the needs of stakeholders – that is employees…….not feasible in practice.

Talented employees need to be valued and invested in in order to retain.