MANAGING ORGANIZATION CASE STUDY

Managing Organization: Case Study



Managing Organization: Case Study

Introduction

This paper is based on a case study of an manufacturing company called “Chalmers”, with a total strength of 800 employees. The use of rewards in everyday life is a tricky business. One problem is that rewards are often given to get people to do what we want. Under such conditions, rewards are not positive motivators of behaviour; instead, they serve as negative incentives. For example, managers in manufacturing company (as mentioned in the case of Chalmers) may offer employees with compensation rewards for being “good” and they may be promised recognition and advancement if they are “productive.” (Aguilar, 2002)

In such instances, managers offer and give rewards based on their judgments and evaluations of employee performance. Because the standards of performance are often vague in these circumstances, rewards can be manipulated to the advantage of those in charge. Such a reward system, from the point of view of students and employees, can quickly become unfair and coercive (Andrews, 2001) . What is “good” today may not be good tomorrow (Heery, 2005). Thus, those in supervisory positions can withhold the rewards that are currently being given for acceptable performance and require better and better levels of accomplishment. Reward systems arranged in this way are programmed to backfire; people will eventually show willful noncompliance, escape, avoidance, and, in some cases, rebellion (Heery, 2005).

Discussion

Reward management has a key position within Human Resource and retention theory for a number of reasons. Pay is a central organisational concern because questions of financial control and cost management are themselves fundamental to the organisation and to management decisions. Discussion and negotiation about those decisions and about the level and distribution of pay bring personnel or the HR function into a central organisational position (Heneman, 2008). Reward management is one of the key levers to be deployed in pursuit of effective HRM. If pay is to 'deliver the goods' in terms of HR strategy, then it must be structured, it is argued, in order to meet organisational objectives (Aguilar, 2002).

It follows, according to the logic of the 'New Pay', that as business performance can vary, so too should the levels of pay. In other words, the pay package should comprise pay which is 'at risk' as well as pay that is guaranteed. The 'New Pay' writers argue for the continuing need for adaptation in business practice in a dynamic business environment (Andrews, 2001).

Importance of Giving Rewards

Rewards given for achieving relatively challenging standards are also indicative of competence. It has been noted that rewards given for meeting or exceeding a challenging criterion verify people's competence (Heneman, 2008). When incentives are given for trying hard, people learn what skills they possess and what they are able to do. Rewards tied to achieving performance objectives also cause people to care more about doing well at an activity and increase intrinsic interest more than positive performance feedback without reward (Aguilar, ...