In the initial design of an incentive plan, it will be essential for the employer to define the incentives in a clear and precise manner. The employer should know how much an incentive program will cost the organization, where in time or monetarily. Though each incentive plan is different, many include incentive pay, additional benefits, profit sharing, merit pay, and additional time off. Because of the additional cost to an organization, it is important to the cost of such programs against the outcome of productivity. As the program is used, the organization should always monitor and make adjusts as needed to increase the output desired.
These systems are designed to motivate and make employees feel appreciated for the work that they do. When looking in to the reward system of a company the employer wants to make ensure that basic needs of the employees are met. Money is always a great incentive for an employee. In addition, to be considered are that the rewards offers comparative benefits, are distributed equally and each employee is treated like an individuals. A reward should recognize and reward two employee actions, activity- performance and behavior. For a company performance, it is easy area to address since the employer sets the initial goal and the results of the outcome are clear. When rewarding specific behaviors the employer will want to look at the employees who made a positive difference in the company, it is important that you identify each behavior. Behavior activities might include enhancing customer relationships, being a positive team player, or helping others expand their managerial skills. Hale Jamie in “Strategic Rewards: Keeping your best talent from walking out the door (1998) said: “The distinguishing feature of Strategic Rewards is their emphasis on motivating only those behaviors, actions, and accomplishments that help advance the organization toward specific business goals. Strategic Rewards plans go beyond cash to include training and educational opportunities, job redesign, flexible work schedules, stock options, and recognition awards such as merchandise and travel. They stand in contrast to traditional merit pay increases, which have come to be viewed as entitlements and thus are no longer capable of truly motivating or reinforcing employee behavior.”
The company has to have a plan on how reward and recognition system is going to look. It is important that the company ensure that the system is fair and has strict rules and guideline to how it will be used. The employer should have staff appraisal done every