¶ … employee rewards has been increasingly brought to the forefront. This is because globalization is creating a shift in how firms are operating by requiring the utilization of specialized skills. These individuals are necessary for a firm to be able to adjust with changes inside the marketplace and new competitors. As a result, a number of organizations have begun focusing on transforming compensation strategies to address these needs. To fully understand how this is occurring requires focusing on: the way this can improve competitive compensation plans, how they are tied to specific jobs, the effectiveness of an equity-based rewards system, the key factors for integrating this model with traditional rewards programs and providing recommendations that will streamline these initiatives. Together, these elements will provide specific insights as to how a firm can improve their competitive compensation strategy. (Wilson, 2003, pp. 1 -- 15)
Innovations of Employee Benefits
Innovations in the type of benefits that employees are receiving will lead to a transformation in the workplace. This is because everyone will compare the kind of compensation they are receiving with other firms. Those that offer the greatest benefits will be the most sought after. The reason why is, these areas will address the critical needs of the individual. Moreover, the generous rewards plans are illustrating the kind of work environment that exists inside a particular employer. (Griffin, 2012, pp. 396 -- 400)
For staff members, they will compare what they are receiving with their peers inside the industry and their levels of job satisfaction. When there is an improvement in compensation plans, there will be changes in the attitudes of employees. This is because they will use the rewards program to determine how much the firm cares about: their well-being and time. As a result, innovations in compensation plans will have a dramatic impact on the underlying levels of productivity. (Griffin, 2012, pp. 396 -- 400)
Evidence of this can be seen with Google, as they have a generous rewards program for developers including: an onsite doctor, free childcare, a flexible work schedule and outstanding pay. This is showing how...
Those firms that are able to make continuous improvements in these areas will be able to attract and retain the best employees. (Griffin, 2012, pp. 396 -- 400)
Benefits and Specific Jobs
The way that benefits could be linked to a specific occupation, is to seek out individuals who are highly qualified (with predetermined skillsets). This will ensure that they meet the basic standards for the position. Next, there must be a focus on offering employees more in comparison with other firms. This will have a positive impact on how the individual will view their role inside the organization and their responsibilities. Once this takes place, is when they are willing to go above and beyond what is required for the position. This will lead to positive changes in customer experiences. (Griffin, 2012, pp. 396 -- 400)
Using the previous example from Google, the benefits for the most important positions are tied directly to compensation. This is because it is used as a way to entice someone to work for them over other firms (i.e. Microsoft, Oracle and Apple). These programs are designed to give employees a sense of on the job satisfaction by: providing them more than what they will receive elsewhere. When this happens, they are willing to help the company to achieve its objectives (based on these positive feelings). (Bauer, 2005, pp. 859 -- 891) (Griffin, 2012, pp. 396 -- 400)
Equity-based vs. Innovative Rewards Programs
Equity-based compensation plans are an effective way for employees to directly benefit from their contributions (through: sharing in the profits of the firm). This is accomplished by providing them with a certain amount of common stock (as a part of the overall benefits package). The basic idea is to ensure everyone is motivated to do more by receiving a financial stake in the company. (Shin, 2005, pp. 101 -- 113)
However, a drawback of using this approach is that employees and staff members can engage in unethical activities to achieve the profit margins of the firm. This is because they will want to see the value of their investments increase. During times when the economy is strong, this…
