Advantages Of A Total Rewards Essay In Accent Inc.

Career growth pathways and staff retention

Questions:

1.Discuss  the benefits of offering a total rewards system, that includes both Financial and Non-Financial Compensation Components within such a system as well as the pay administration process that delivers such rewards effectively to the Workforce

2.Critically analyse the relevance of considering the recent trends in pay structures that support such philosophies  and how it can be Implemented effectively. 

3.List and discuss on any four Objectives that the Company must consider to ensure pay Effectiveness.

1.There are certain advantages of offering a total rewards system in Accent Incorporated and they are discussed briefly as follows:

Employee retention and performance (Non-financial components):

The total rewards system offers ostensible paths for the overall career of a staff depending on the basic template for the particular program. When an organisation recruits an individual on a total rewards system, it could depict that staff the points at which pay raises, bonuses, increased vacation and enhanced benefits take place during the career trajectory of the individual (Bryant and Allen 2013). With the help of this system, Accent Incorporated could provide immediate incentive for staff retention by providing a staff with a series of long-term goals and projections. Thus, it helps in ensuring transparency by fostering an effective working relationship in the organisation by bringing the staffs and managers on equal footing, when it comes to knowledge concerning career trajectories.

In addition, Accent Incorporated could restrict ostensible career trajectories, even though staffs understand that certain aspects of such trajectories like bonuses take place only, if the performance standards are met. This program constitutes of aspects like training and performance management and professional development, which enable the staffs to adopt special and new skills with the help of training and education (Cerdin and Brewster 2014). Hence, with the help of this system, Accent Incorporated could include methods of staff performance monitoring for enabling staffs to create and input dialogue, all of which assist in fostering an association of mutual input. This would lead to increased levels of understanding and professional respect.

Controllable expenses (Financial components):

The overall and long-term scope of the total rewards program enables an organisation to develop rightful projections of the amount incurred on each staff over the course of a number of years (Hofmann 2015). By forming a total rewards system, Accent Incorporated could possess the capability of creating an expenditure matrix, which fits the finances of the program at its outset as well as within the parameters of the anticipated growth of the organisation as it forms. This system has cyclical nature that takes into account design, execution, evaluation, assessment and back to design. Thus, it enables for adjustments in expenses to keep with variations in the company budget. With the increase in earnings, Accent Incorporated could filter more money to staffs in the form of increasing pay, providing staffs the growth perception along with encouraging staff performance and longevity.

Transparency and cost projection

Pay administration process:

In the words of Klingner, Nalbandian and Llorens (2015), total rewards system provide the benefit of centralised administration in staff-related concerns that take into account pay, benefits and training. In case of Accent Incorporated, such system of administration provides the benefit of an overall system through which to control each aspect. In the existing system of the organisation, the healthcare administration takes place distinctively from pay, while pay raises and bonuses occur on a different schedule than training and development. By applying the total rewards system, each of these stuffs takes place on a single time and it could be overseen simultaneously.

2.A pay philosophy is the commitment of an organisation to the way it values its staffs (Long and Perumal 2014). As Accent Incorporated is a private sector organisation, it generally needs a philosophy of competitive pay and its purpose is to retain, attract and motivate staffs. In order to achieve these goals, it could use a mix of three compensation components. These include base pay, incentive pay and benefits or non-financial rewards. Since Accent Incorporated has moderate cash resources, the philosophy of the organisation might be depicted like this:

• Paying a competitive base pay, which should not be aggressive; however, a pay comparable to what a staff could find in other similar organisations
• Offering equity to all the staffs in the organisation, so that they could reap the benefits of the organisation
• Accent Incorporated is required to be aggressive in the overall compensation with the help of incentives. For instance, if a staff is below market by $20,000 in base pay, market parity could be delivered through a signing bonus of $5,000; retention bonus of $5,000 and $10,000 incentive. Thus, the incentive programs need to be designed for providing greater compensation to high-performance staffs.

According to the Malaysian law, the pay practices need to be consistent, indiscriminate and it need not be arbitrary. However, a pay philosophy might include various approaches for various types of staffs. For instance, Accent Incorporated might determine to pay a competitive rate for most tasks and aggressive rate for tasks particularly difficult to fill and significant to the bottom line (Oladapo 2014). Hence, it could pay its sales personnel and executives at the 75^th percentile and the remaining staffs at the 50^th percentile.

However, if a philosophy is applied inconsistently, it could devalue the staffs, which might cause trouble. For instance, it is assumed that Accent Incorporated established a flat rate of $9.90 per hour for the non-exempt staffs in the role of customer service. The turnover of the department has been 200%. Despite the available flat rate, few staffs with lower degrees negotiated successfully for $10 per hour, while the staffs having long experience assumed that such rate was non-negotiable. Thus, this might lead to discrepancies due to the pay philosophy, which would increase the expenses of the organisation (Rogers 2014).

In order to implement the pay philosophy, Accent Incorporated needs to enhance its communication level, since a sound philosophy develops a sense of fairness. Hence, it needs to advertise its pay structure as a retention and recruitment strategy (Saxena and Rai 2016). It could publish the pay philosophy in a staff handbook for depicting to the staffs about its standing in relation to the market. For instance, in case of Accent Incorporated, if it experiences greater turnover in customer service department, it could compensate the representatives of the department above market. The individuals working in the department might receive efficient workspaces, incentive plans and greater base pay than the market (Schiemann 2014). Under such situation, the CEO of Accent Incorporated needs to communicate about change in the philosophy to the staffs by presenting solid reasons behind the undertaken decision.

Centralized administration and pay philosophy

3.The four objectives that Accent Incorporated could consider to ensure pay effectiveness include the following:

To attract top talent:

According to Shortland (2017), one of the main goals of compensation needs to be recruiting qualified and experienced talent. With a competitive compensation in place, Accent Incorporated could be able to attract the top talents in the industry.

To retain and reward personnel:

It would not be effective for an organisation to lose the top talent to its rivals, as it would minimise its overall organisational effectiveness (Stone and Deadrick 2015). Thus, Accent Incorporated could find out market values for its staffs and design its pay accordingly. In addition, it could establish pay-for-performance models for driving performance by strengthening associates to accomplish new goals and push further.

To boost motivation:

If the pay structure of Accent Incorporated is effective, the compensation plan could increase motivation across the various departments within the organisation. The staffs knowing that they are compensated fairly for their work would feel appreciated and hence, they are probable to remain committed, productive and engaged. An effective compensation plan could increase job satisfaction of the organisation.

To maximise return on investment:

If Accent Incorporated develops a compensation plan staying within budget along with driving productivity with the help of pay-for-performance and other tactics of motivation, it could develop a plan equitable for the organisation and beneficial for the hard-working staffs. Thus, it could use compensation management software for simplifying planning processes to assist in accomplishing the objectives listed above without putting any burden on HR. Moreover, the management could tailor the same to the organisation for prioritising the important objectives.

The major differences between basic fixed rate scheme and incentive scheme include the following:

References:

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Cerdin, J.L. and Brewster, C., 2014. Talent management and expatriation: Bridging two streams of research and practice. Journal of World Business, 49(2), pp.245-252.

Hofmann, A., 2015. Compensation and Benefits: Essentials of Base Salary. Handbook of Human Resources Management, pp.1-15.

Klingner, D., Nalbandian, J. and Llorens, J.J., 2015. Public personnel management. Routledge.

Long, C.S. and Perumal, P., 2014. EXAMINING THE IMPACT OF HUMAN RESOURCE MANAGEMENT PRACTICES ON EMPLOYEES'TURNOVER INTENTION. International Journal of Business and society, 15(1), p.111.

Oladapo, V., 2014. The impact of talent management on retention. Journal of business studies quarterly, 5(3), p.19.

Rogers, D., 2014. Compensation and benefits survey 2013: Education and job responsibility key to increased compensation. Journal of the Academy of Nutrition and Dietetics, 114(1), pp.17-33.

Saxena, N. and Rai, H., 2016. Correlations and organisational effects of compensation and benefits, job satisfaction, career satisfaction and job stress in public and private hospitals in Lucknow, India. Asia Pacific Journal of Health Management, 11(2), p.65.

Schiemann, W.A., 2014. From talent management to talent optimization. Journal of World Business, 49(2), pp.281-288.

Shortland, S., 2017. International assignment reward policies: the importance of compensation and benefits to women’s expatriate participation.

Stone, D.L. and Deadrick, D.L., 2015. Challenges and opportunities affecting the future of human resource management. Human Resource Management Review, 25(2), pp.139-145.

Wang, G. and Singh, P., 2014. The evolution of CEO compensation over the organizational life cycle: A contingency explanation. Human Resource Management Review, 24(2), pp.144-159.