Strauss Cars is one of the leading car rental companies in Europe, operated in 25 countries with about 1250 points of sale. After strategic review in 2012, Board decided to change traditional values and to focus on organic growth and improve the quality of service to its customers. Also, Board decided to unite sales and marketing centers in Edinburgh; consequently, staff from Manchester and Cardiff will be offered redundancy or relocation.
Implementation of Board new strategic plans is a big issue for a company overall and especially for employees from Manchester and Cardiff. HR department have no influence on board decisions, HR Director didn’t play a role of business partner in Strauss Cars and that’s why Board didn’t consulted with him about their plans and new strategy was formulated without HR and reward issues.
At present time, Strauss Cars don’t have a reward strategy at all. The company pays average salaries, but Joe Root noted that salary levels in sales and marketing centers are inconsistent. Customer service managers claimed that their staff is underpaid and leaving company. Organisation structure is unclear and there are a lot of job titles and terms and conditions across the sales and marketing center and head office. Salaries weren’t reviewed systematically and job profiles didn’t evaluated formally and properly. The only one benefit is subsidised car hire, also there are no incentive payments in Strauss Cars. Performance management system, as appraisal system is also not presented in the company.
Lack of systematic approach to staff reward, i.e. constructing reward system in accordance with the strategy and objectives of the company, results in loss of employee engagement and discouragers staff loyalty to the company.
The aim of this essay is to critically evaluate existing reward management practices in Strauss Cars, and to formulate new total reward strategy which will correspond to the main proposed changes to the company's strategy.
But why do companies need a systematical approach to reward management for staff? The reward system is crucial importance to foster and encourage the behaviours, ideals and principles the organisation values and is expected will be delivered by its staff. This means developing systems which enhance the chances that an organisation’s employee will seek actively to contribute to the achievement of its employer goals. So that, if improved quality of service is the major business objective, this should be reflected in a payment system which rewards sales staff who provides the best standards of service to customers.
But the problem is not as straightforward as it might seem, organisations are in fact obliged to compete one another for good staff as well as for customers. The tighter the labour market becomes, the harder is to recruit and retain the best-qualified people, and the more pressure is placed on employers to develop rewards packages capable to suit both their staff and their own needs....