(Solution) ICS Learn 5HR03 AC 2.2: Contingent Rewards Impact
Solution
Organisations provide contingent rewards to their staff members by using performance-based incentive programmes that reward specific accomplishments and organisational goal attainment (CIPD, 2022). Organisations use both monetary and non-tangible incentives to reward workers and raise motivation which results in performance enhancement and employee commitment. Performance-based compensation consists primarily of two types which involve both performance-related pay programmes and recognition schemes.
Performance-Related Pay (PRP)
Additional employee compensation through PRP depends on performance either individually or as part of a group (Cotton, 2022).
The financial compensation combines bonuses and commissions while salary growth depends on workers achieving specific performance indicators called KPIs.
Impact on Individual Performance: The performance reward programme motivates staff to enhance their work efforts along with goal completion and to reach maximum productivity levels. PRP expands the connexion between work intensity and prize distribution which pushes employees to demonstrate superior performance. When targets prove too challenging or reward systems lack consistency employees tend to become unsatisfied.
Impact on Team Performance: PRP achieves better team performance results when linked to shared team objectives since it promotes both team working and shared responsibility. The system creates interpersonal conflict when select members believe other teammates fail to provide equitable work involvement.
Impact on Organisational Performance: The implementation of performance-related pay systems drives efficiency alongside productivity resulting in better organisational performance levels. Inadequate management of this system may create an organisational environment where short-term target performance takes precedence over long-term innovation and development activities.
Recognition Schemes
Recognition schemes distribute…………….
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