Assignment 5: Executive Report on Total RewardsTHIS IS FOR AN UNUSED NOT PUBLISHED DOCUMENT USING THE INFO I PROVIDED AND YOUR OWN RESEARCH METHODS. *** ALL PREVIOUS PAPERS HAVE BEEN PROVIDED AND THE

Sales Force Compensation

Tennille Poole

HRM 533

Dr. Walsh

July 30, 2018

Sales Force Compensation

The compensation plan is the most significant part of the strategic Human Resources Management Plan and is quite a critical one for ensuring the success of the organization. Nowadays, industries are being driven by four M’s including Material, Money, Machine, and Man. Amongst these, the industries are aware that the man is the most critical asset and driving element (Brown, 2014). If the employee is performing in an efficient manner towards the achievement of goals within the organization, then the organization will be able to achieve its objectives as per its target. Now, the significant part is the methods by which the organization can motivate its employees to perform in an efficient manner so that they can achieve their objectives (Hansen, Smith & Hansen, 2002).

As per the scientific management theory, the financial compensation is the most significant element for the motivation of employees, where human relations management theory stress upon the teamwork and other non-financial compensations for enhancing the motivation level of the employees (Howard & Dougherty, 2004). This study will research a workforce of a large organization and the compensation plan used by them for motivating their employees. This study will focus on the behaviors of the sales force that the organization is targeting using this compensation plan. Afterward, the study will analyze that how the organization is able to achieve its value proposition with the use of this plan for current and future employees. Lastly, the study will analyze the attraction level of the future sales person to the current compensation plan of the organization.

The selected company for this study is Amazon that is an American electronic commerce company operating since 1994 with its established headquarter in Washington. The company has total operating revenue of about USD 177.86 Billion with a total number of 566,000 workforces (Rossman, 2017). Due to a large number of workforces, the company has an effective compensation plan for the motivation of its employees in order to achieve maximum productivity.

Six Features of an Effective Total Rewards Program

The main features of the total reward approach used by the Amazon include; Compensation: the compensation is the most critical part for the motivation of employees as per scientific management theory (Hussain et al., 2013). The company must develop a special pay structure for the employees that comprises of fixed and variable pay. The fixed pay will be the basic pay of the employee as per his performance. The variable pay will have no limit for the employees as it depends mainly upon the performance of the employee including bonus, profit and ownership sharing, etc.

Time Off: the company must provide a significant option to their employees for making best out of their paid leaves and unpaid time off (Morrell, 2011). The company must encourage its employees for taking some time out for their families in order to get recharge and resume working with more zeal.

Fringe Benefits: the company must pay certain benefits to its employees in the form of medical, life insurance, social security, etc. The company must provide these benefits to lighten the stresses of their employees regarding their security and future planning (Vance, 2012).

Transparency and Open Communication: the Company must set clear criteria for the monthly, quarterly and annual reward program of their employees by which all the information is shared with the management in an open way and is available for everyone (Wonki & Kang, 2013). The company will remove any reservation of the employees regarding the credibility of rewards program at the organization with the support of transparency and open communication.

Work-life balance: the Company must provide an effective opportunity to its employees for maintaining a balance between their personal and professional life. The company can also provide paid and unpaid leave to its employees in this regard. Moreover, the company must offer the flexible timing working option to its employees (Morrell, 2011). In addition, the company should offer certain maternity and parental leaves to its employees at the time of childbirth or adaption.

Growth and Development: the Company believes that all of their employees are innovative and can help the organization in growth and development. For the same reason, the company must arrange various learning opportunities for their employees in order to make them productive and efficient towards the work (Wonki & Kang, 2013). Other programs like self-directed learning and mentorship programs support the Amazonians to connect with each other.

Sale’s Behavior Targeting Compensation Plan

The Amazon will be offering significant benefits to its employees for motivating its employees as a part of their reward program. The main aim of the company behind the offering of such benefits to the employees is their expectations of innovative solutions, efficient performance, and high productivity. The company will be able to achieve these aims from their employees as the employees are suggesting innovative solution to the organization, dealing effectively with the organizational customers, enhancing level of satisfaction, sharing information with each other for the development of overall workforce, and promoting their business in an ethical and legal manner for ensuring maximum profit (Howard & Dougherty, 2004).

The employees of the company will be able to receive their variable pay in the coming month pay-out encouraging the employees to maximize their productivity by gaining more financial compensation that ultimately benefits both employee and organization (Hansen, Smith & Hansen, 2002). As the compensation plan of the organization is reducing the stress level of the employees regarding their current problems or future planning; therefore, the employees will be able to work more effectively towards the achievement of their targets set by the organization. Moreover, the diligent care attitude shown by the Amazon will increase the loyalty and trust level of the employees towards the company resulting in reduced retention rate at the organization (Hussain et al., 2013). The low turnover of the employees saves the organization from any training cost and disruption in the work. Overall, the behavior of the employees towards the organization will be quite productive due to the positive reward program being practiced with full accountability at the organization.

Achievement of Value Proposition for Current and Future Employees

It is much significant to estimate value proposition for the reward program developed for the employees of Amazon. The value proposition includes all the elements of a total reward program including compensation, fringe benefits, development, management, etc. defining the overall working experience of the employee at the organization (Hussain et al., 2013). It is much significant for the organization to maintain equilibrium between the benefits to the employees and expectations from them in return. The total reward plan developed for the Amazon is quite balanced and flexible in terms of compensations, rewards, benefits, and development. For example, the compensation of the employees includes both basic and variable pay (Hansen, Smith & Hansen, 2002). The basic pay will act as a right of the employee, where the variable pay will be the motivating factor for the employee. Similarly, the benefits containing life insurance, medical support, social support, paid and unpaid holidays will support the employees in reducing their stresses related to their current problems and future planning. Time off feature will provide maximum opportunity to the employees for maintaining equilibrium between their family and work (Morrell, 2011). Lastly, the career development feature will provide them distinguish opportunity to excel in their professional life.

From the defining aspect of the total reward program, it is quite clear that the program is targeting and satisfying each factor that can hinder the performance of the employee without posing much effect on the financial position of the company (Wonki & Kang, 2013). The key elements in the total reward program are quite considerable and efficient for raising the motivation level of the employees and urging them for staying at the organization for a long time. The total reward program is quite productive for the organization to develop an encouraging, conductive, and obliging work environment that will support the organization in gaining expected behavior from its employees with a certain increase in their motivation level (Vance, 2012). Lastly, the company achieves its biggest value proposition through total reward program due to its alignment with the goals and objectives of the organization that can support them to achieve their strategic vision, mission, and goals with organizational values.

Worth of Plan for Future Sales People

There is no doubt that the total reward plan is critical enough to retain and motivate its existing employees. However, at the same time, it is much criticism for the organization to attract new talents in the market for the continuous development of the organization (Hussain et al., 2013). The developed program contains all the factors that any employee considers before selecting and joining any organization. The current compensation plan is more in the favor of the employees as compared to the employer. The employee will be able to gain sufficient benefits from this program including effective salaries, enough leaves, fringe benefits, and career development. As per the scientific and human relations management theory, financial and non-financial benefits are significant for attracting the employees (Hansen, Smith & Hansen, 2002). The developed total reward plan is satisfying both elements as per the theories; therefore, it will be significant enough to attract new employees.

Any new sales force individual will be able to gain sufficient benefits from the program, as they will be able to improve their living standard by earning maximum. They will be able to eradicate their daily life problems by using fringe benefit feature. They will be able to spend enough time with their families due to the time off and flexible working hour option by the organization (Howard & Dougherty, 2004). They will be able to excel in their professional career due to the provision of certain training and learning programs. However, the organization needs to ensure accountability in the compliance of this program. The organization must consider the review of their employees for carrying out any revision in the total reward plan as the basic purpose of the total reward program is employee productivity and motivation; therefore, the organization must follow the plan with full accountability.

References

Brown, D. (2014). The Future of Reward Management. Compensation & Benefits Review, 46(3), 147-151. doi: 10.1177/0886368714549303

Hansen, F., Smith, M., & Hansen, R. (2002). Rewards and Recognition in Employee Motivation. Compensation & Benefits Review, 34(5), 64-72. doi: 10.1177/0886368702034005010

Howard, L., & Dougherty, T. (2004). Alternative Reward Strategies and Employee Reactions. Compensation & Benefits Review, 36(1), 41-51. doi: 10.1177/0886368703261273

Hussain, S., Rizwan, M., Nawaz, M., Hameed, W., & Rizwan, M. (2013). Impact of Effective Training Program, Job Satisfaction and Reward Management System on the Employee Motivation with mediating role of Employee Commitment. Journal Of Public Administration And Governance, 3(3), 278. doi: 10.5296/jpag.v3i3.6222

Morrell, D. (2011). Employee Perceptions and the Motivation of Nonmonetary Incentives. Compensation & Benefits Review, 43(5), 318-323. doi: 10.1177/0886368711407998

Rossman, J. (2017). The Amazon Way: 14 Leadership Principles behind the World’s Most Disruptive Company. SDMIMD Journal Of Management, 8(1), 95. doi: 10.18311/sdmimd/2017/15723

Vance, M. (2012). Deferred Compensation Plan Characteristics and Voluntary Employee Turnover. SSRN Electronic Journal. doi: 10.2139/ssrn.2133142

Wonki, L., & Kang, H. (2013). Effects of Employee training and Reward system on Motivation of employee. Korea International Accounting Review, 1(51), 1-22. doi: 10.21073/kiar.2013..51.001