Competitive Rewards System Reduces The Employee's Turnover In The Organization

4319 words - 17 pages

COMPETETIVE REWARDS SYSTEM REDUCES THE EMPLOYEES'TURNOVER IN THE ORGANIZATION1. IntroductionHuman Resource Management (HRM) has become an important tool to promote the rapid development of modern enterprises. One of the core functions of HRM is to settle compensation and benefit packages for the employees. An effective compensation and benefit package must include competitive rewards system which should be performance oriented. Reward system will be an effective tool to promote the realization of enterprise strategic goals. Reward management changes the enterprise' spirit and the relationship between labor and management, increase the enterprise' competitive edge and vitality in its own special way. It plays an important role in the process of reforming and guiding the enterprise.Turnover is becoming a serious problem in today's corporate environment. The employment culture is changing as well. It is now relatively common to change jobs every few years, rather than grow with one company throughout the employment tenure. Basically, organizations always strive to retain an efficient and capable workforce for it's rapid development. Here comes the necessity of competitive rewards system. Standardizing the reward system to enhance employees' satisfaction and performance benefits both the individual and the enterprise, balances the influences coming from various factors, which ultimately reduces the turnover in the enterprise. Reward system should be reasonable and aligning with organizational structure.This paper analyzed the causes and remedies of turnover in any organization, highlights some ideas of reward system, and finally derive the effect of competitive reward system to reduce turnover in the organization. It also provides some concrete frameworks and decision-making tools that will help in understanding the power of reward management for tomorrow's organizations.First, I shall focus on turnover which will include causes of turnover, factors which affects turnover and steps that can be taken to reduce turnover. Then I shall highlight the purposes, goals and principles of rewarding system. Last but not least, I shall discuss performance based reward system, Competitive Compensation Plans and Reward Programmes to reduce turnover followed by few recommendations.2. Analysis of the Topic2.1 General"Reward" and "turnover" should be considered as an important element for strategic implementation of HRM for any organization. Both terminology ("Reward" and "turnover") is interlinked and dependent on each other. In a mathematical sense we may explain that "Reward" and "turnover" is inversely propotional to each other . However, there is a lot of misunderstanding on the concept of rewarding and its content, which is also evidenced by the use of a lot of terms like compensation, remuneration, pay, incentives, rewards, etc. Therefore, I would first like to focus on the relevant terminologies that will be coming subsequently.2.2 TerminologiesTurn...

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