Introduction And Meaning Of Reward Management
Reward management is a process of analyzing, developing, and controlling remuneration, incentives, rewards and other forms of financial and non-financial benefits for the employees in the organization. It is a motivational tool that helps to improve workers performance and efficiency. It helps to establish better employer-employee relationship and promotes positive culture in the workplace. Effective reward management helps to motivate employees that leads to increase in the productivity and profitability of the organization.
Importance Of Reward Management
Significance or importance of reward management can be highlighted as follows:
1. To Minimize Stress And Absenteeism
A good reward system reduces the stress and boredom that helps to reduce absenteeism and increases the employee loyalty. Therefore, it is a motivational tool to improve employees engagement in the organization.
2. To Increase Motivation And Morale
It ensures equitable and fair reward system that increases employee motivation, morale and job satisfaction. It also helps to establish better employer-employee relation in the company.
3. To Retain Talent And Capable Employees
Another importance of effective reward management is that it helps to retain capable and talent employees because they feel happy, valued, and respected in the organization. Therefore, it reduces labor turnover.
4. To Attract Talent And Capable Candidate
Company can attract talent and competent candidate for the vacant posts by implementing good reward policy. Therefore, it assists recruitment and selection process to hire the most capable candidate.
5. To Increase Productivity And Profitability
Because of reduced stress, absenteeism and increased motivation, employees' efficiency and performance will be increased that helps to increase the productivity of the company. Increased productivity reduces the cost of production that leads to increase in the profitability of the organization.
6. To Promote Team Work And Coordination
Reward management promotes team spirit and sense of cooperation and coordination in the workstation. It encourages employees to work together to achieve predetermined goals and targets.
7. To Create Better Working Environment
Proper reward system improves employee motivation, job satisfaction, loyalty, establishes good management-employee relation and promotes sense of team spirit . So, it helps to create better working environment in the organization.