Streamline Training & Documentation: Advice for Managers on Rewarding Employees

Saturday, July 28, 2007

Advice for Managers on Rewarding Employees

A 2006 publication of the American Management Association (AMA), The Manager's Guide to Rewards: What You Need to Know to Get the Best for — and from — Your Employees, by Doug Jensen, Tom McMullen and Mel Stark, has a well-designed graphic in its first chapter (see below) summarizing the elements of organizational rewards and recognition.¹ (The AMA has posted the chapter online as an introduction to, and sample of, the book's content.)

The authors are at pains to place rewards and recognition within a larger framework that identifies a complement of seven levers an organization operates, more or less deliberately, to get from its business strategy to end results:

Leadership

Values and culture

Work processes and business systems

Management processes and systems

Organization, team, and job design

Individual and team competencies

Rewards and recognition

Jensen, McMullen, and Stark emphasize that the level of business success and ROI on human resources an organization achieves, is highly dependent on bringing these levers into mutual alignment, so that they reinforce each other rather than working in isolation and possibly at cross purposes.

In talking specifically about employee compensation, the authors argue:

Sports teams rarely win based on new plays. They win with great players, great coaches, and the ability to execute as a team. Likewise in business, compensation can and does play an important supportive role in achieving success, but it rarely causes performance. In our experience, too much weight is placed on compensation, yet not enough is placed on alignment; there's too little focus on what's truly important. Moreover, the KISS principle (Keep It Simple, Stupid) is very important if compensation programs are to have true motivational value.

As the above graphic indicates, a well-run organization will design its compensation arrangements as part of a carefully thought-out total rewards system embodying both tangible and intangible elements.

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¹ The authors are senior executives with Hay Group: Doug Jensen is US Executive Compensation Practice Leader, Tom McMullen is US Reward Practice Leader, and Mel Stark is Regional Reward Practice Leader in the New York office.

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Labels: Rewards and recognition

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