Reward Main

8/12/2019 Reward Main

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Research Methodology

Primary Data:

Primary data is collected by visiting well known organizations belonging to different sectors.

This Data is collected through interaction with industry professionals.

Secondary Data:

Secondary data is collected from various books, magazines and internet websites, which are

mentioned In the bibliography.

Preparation of Questionnaire

Visiting various organizations

Collecting Data

Analysis of the data


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OBJECTIVE

To study the impact and effectiveness of Reward Mechanism in various organizations and to

understand its significance and role in the policy of an organization, that will contribute in the

overall achievement of organizational goals.

SCOPE

Reward system in any organization plays a significant role in motivating and retaining employees. Along with this it also helps in boosting the morale of employees. This study shows the extent to which a reward system has its impact on the overall performance

of the employees in an organization


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INTRODUCTION TO REWARD SYSTEM

Introduction

Reward system usually means the financial reward on organization gives its employees in return for their

labour. While the term rewards system, not only includes material rewards, but also non-material rewards.

The components of a reward system consist of financial rewards (basic and performance pay) and employee

benefits, which together comprise total remuneration. They also include non-financial rewards (recognition,

promotion, praise, achievement responsibility and personal growth) and in many case a system of

performance management. Pay arrangements are central to the cultural initiative as they are the most

tangible expression of the working relationship between employer and employee. Many papers examine the

role of organizational culture i.e., the demand for monitoring compensation. Such investigations conclude

that organizational culture places a significant role in determining the level of economic demands. Recent

researches on industrial unrest rest indicate that reward criteria of the organizations both financial and non-

financial rewards have tremendous influence upon the employees and employers performance.

Concept

Employee reward is about how people are rewarded in accordance with their value to an organization. An

employee reward system consists of an organizations integrated policies, processes and practices for

rewarding its employees for their contribution, skill and competence and their market worth. It is concerned

with both financial and non financial rewards and is developed within the frame work of the organizations;

reward philosophy, strategies and policies, and contains arrangements in the form of structure and

procedures which will provide and maintain appropriate types and levels of pay, benefits and other forms of

reward.


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Definition

Reward Strategy

The deliberate utilization of the pay system as an essential integrating mechanism through which the efforts

of various sub-units and individuals are directed towards the achievement of an organizations strategic

objectives.

Reward strategy provides specific directions on how the organization will develop and design programs that

will ensure that it rewards the behavior and performance outcomes that support the achievement of its

business goals.

Evolution (modern and traditional)

In the earliest years that the fields of compensation and benefits were recognized as professions, practice was

based largely on formulas that served the entire employee population in an organization. Salary structures

were just that -- rigid and highly controlled -- and benefits programs were designed as a one-size-fits-all

answer to a homogenous work force.

In the 1970s and 1980s, organizations recognized that strategically designed compensation and benefits

programs could give them the edge in a rapidly changing environment. Organizations were responding to:

Global economic development and the emergence of multinational firms A much more competitive business environment Diversification of the work force to include workers who didn't fit the sole breadwinner, head-of-

household model of the '50s and '60s

New government mandates related to employee benefits Rapidly rising benefits costs that prompted flexibility in programs to reduce costs.

Suddenly, the relatively simple compensation and benefits programs of the past were requiring consideration

of their strategic impact and relationship to one another. Integration became a key, and compensation and

benefits professionals emerged as critical strategic partners in their organizations' leadership -- a position

still occupied by leaders in the field today.


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Companies have experienced unprecedented challenges including:

Dramatic changes in the workplace, including increased awareness of conflicts caused by family,home and work demands.

Workforce demographic changes that challenged the traditional working-father, stay-at-home-mothermodel of previous decades.

Fewer resources available for pay increases. Substantial increases in health-care costs in some countries. Rapid decline of defined-benefit pension plans as a financially viable retirement model. Tremendous advances in technology and the emergence of new business opportunities. Geographic movement of many manufacturing and service roles.

Advancement of pay-for-performance practices. Unprecedented mergers, acquisitions and global competition.

Collectively, these forces and others caused business leaders to scramble for ways to improve efficiency,

effectiveness and marketplace viability. HR professionals -- particularly those specializing in compensation

and benefits -- were challenged to contain costs and contribute to improved business results. These

professionals were at the forefront of designing and implementing programmatic changes that have shaped

the next generation of compensation and benefits. The results have included improved alignment of pay and

performance, tighter controls on benefits costs, and more relevant and valued employee rewards programs.

Forward-thinking professionals realized that programmatic advances would not be enough. While program

efficiencies and cost controls have been pivotal for survival, many organizations have recognized that an

integrated and enriched "value exchange" between an employer and its employees can accelerate velocity

and success.


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Components of a reward system

The main components of the system are:

Processfor measuring the value of jobs, the worth of individual in those jobs and the range and levelof employee benefits to be provided. These processes consists of job evaluation, market rate analysis

and performance management.

Practices for motivating people by the use of financial and non financial rewards. The financialreward consists of base and variable pay and employee benefits and allowances. Non financial

rewards are provided generally by the culture and values of the organization and specifically by the

quality of management and leadership, the work itself and the opportunities given to employees to

develop their skills and careers.

Structures for relating pay and benefit levels to the value of positions in the organization and forproviding scope for rewarding people according to their performance, competence, skills or

experience.

Schemefor providing financial rewards and incentives to people according to individual, group andorganizational performance.

Proceduresfor maintaining the system and for ensuring that it operates efficiently and flexibly andprovides value for money.


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Rewards results and behavior that are consistent with key organizational goals, thud driving andsupporting desired behavior.

Is linked with business performance, adopting a competitive strategy perspective. Is practical and implementable. Has been evolved in consultation with key stakeholders.

Content of reward strategy

Strategy which focuses on critical success factors will enable the organization to marshal its resources in

areas which will maximize added value. It will make life easier for rewards strategy, who have to persuade

all concerned of the right direction to takethey will be able to concentrate on what really comes.

Key strategic issues include:

Competitive pay Achieving more equitable and definable pay system Restructuring the pay system to take account ofindeed, to underpinorganizational changes. Performance improvement Culture change Devolution of pay decisions to line managers Involvement of employees in reward matter Developing team work Increasing levels of competence and enlarging the skill base


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Reward policy:Reward policy indicates how reward processes should be designed and managed within the

context of reward philosophy. It provides guidelines for the line managers and personnel or pay specialist on

how particular and recurring reward issues should be dealt with. It enables consistent decisions to be made

where appropriate while recognizing the need for flexibility and the perils of rigidity.

An effective reward policy is one that:

Provides positive indication of what the organization and its management are expected to do or howthey will behave in given circumstances.

Indicates the amount of discretion line managers can exercise, suggesting answers to the questionhow do I deal with this reward issue in these circumstances.

Reward policy issues

Competitive pay the pay policy of the organization indicates the extent to which it wants to bemarket led, that is the relation it wishes to maintain between its pay level and market traits

Internal equitythe degree to which internal equity is of prime consideration and the circumstancesin which the need to be competitive may override the principle of internal equity.

Variable pay thee extent, if any, to which the firm believes that pay should vary according toperformance, competence or skill.

Individual or team rewardthe need for reward to concentrate on individual or team performance. Employee benefitthe types and levels of employee benefits to be provided and the extent to which

employees can choose the benefits they want.

The total reward mixthe mix of total reward as between base pay, variable pay and indirect pay. Structure the extent to which the organization wants a hierarchical and relatively formal structure

or one which is flexible and broad banded.

Reward prioritiesthe degree to which the organization wants to concentrate on piling the rewardshigh for the relatively small number of key players, or recognizes the need to provide reward which

will support the steady improvement of the many.

Differentials the level of reward at the top of the organization compared with average andminimum reward levels.


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Flexibility the amount of flexibility allowable in operating the reward system, the degree ofconsistency required in applying policies the amount of control exercised from the centre.

Uniformitythe extent to which pay structure and policies should apply to the whole organization orbe flexible for different levels of employees.

Devolutionthe amount of authority which will be devolved to line managers to make pay decisions Controlhow much control should be exercised from the centre over the implementation of reward

policies.

Gender equality the approach which will be adopted towards eliminating gender bias in rewardprocess and structures so as to ensure equal pay for work of equal value.

Partnershipthe extent to which the organization believes in sharing success with employees. Involvementhow much employees will be involved in pay decision that affect them.


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Significance of Reward System

To reduce the dissatisfaction of the employees on promotion criterion To reduce the dissatisfaction of the employees on appraisal system. To reduce the dissatisfaction of the employees on salary, bonus and other fringe benefits. To improve the work performance To improve the productivity To reduce the level of occupational stress that arises from feeling of inequality on reward To reduce the perceptional gap on reward management system and develop a culture of high

performance.

Why reward system is required?

These components will be designed, developed and maintained on the basis of reward strategies and policies

which will be created within the context of the organizations between strategies, culture and environment:they will be expected to fulfill the following broad aims;

1. Improve Organizational Effectiveness: Support the attainment of the organization's mission,strategies, and help to achieve sustainable, competitive advantage.

2. Support and change culture: Under pin and as necessary help to change the 'organizational culture'as expressed through its values for performance innovation, risks taking, quality, flexibility and team

working.

3. Achieve Integration: Be an integrated part of the management process of the organization. Thisinvolves playing a key role in a mutually reinforcing and coherent range of personal policies and

process.

4. Supportive Managers: Support individual managers in the achievement of their goals.5. Motivate Employees: Motivate employees to achieve high levels of quality performance.6. Compete in the Labour Market: Attract and retain high quality people.


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7. Increased Commitment: Enhance the commitment of employees to the organization that will a)want to remain members of it, b) develop a strong belief in and acceptance of the values and goals of

the organization and c) be ready and willing to exert considerable effort on its behalf.

8. Fairness and Equity: Reward people fairly and consistently according to their contribution andvalues to the organization.

9. Improved Skills: Upgrade competence and encourage personal development.10.Improved Quality: Help to achieve continuous improvement in levels of quality and customer

service.

11.Develop team working: Improve co-operation and effective team working at all level.12.Value for money: Pride value for the money for the organization.13.Manageable: Be easily manageable so that undue administrative burdens are not imposed on

managers and members of the personal department.

14.Controllable: Be easily controllable so that the policies can be implemented consistently and costscan be contained within the budget.

Aims of Employee Reward

(i) The organizations point of view

A reward system expresses what the organization values and is prepared to pay for. It is governed by the

need to reward the right things to convey the right message about what is important.

Overall aim

The overall aim of employee reward is to support the attainment of the organizations strategic and shorter

term objectives by helping to ensure that it has the skilled, competent, committed and well motivated

workforce it needs. Pay programmes should aim to accomplish the following organizational objectives:

Make excellent performance financially worthwhile. Communicate to satisfactory performers the importance of acceptable and better performance. Communicate to less than satisfactory performers the need to improve.


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Contribution to added value

Added value is created by people. It is people at various levels who create vision, define values and mission,

set goals, develop strategic plans and implement those plans in accordance with the underpinning values.

Employee reward contributes to the creation of added value by helping to ensure that people with the

required competences and levels of motivation are available and by playing a part in creating a culture and

environment that stimulate quality performance.

Contribution to competitive advantage

A firm creates value for its customers, selects markets in which it can excel, and presents a moving target to

its competitors by continually improving its position. Unique talents among employees, including superior

performance, high productivity, flexibility, innovation and the ability to deliver high levels of personalcustomer service are ways in which people provide a critical ingredient in the development of the

competitive position of the business. Employee reward practices can make an important contribution to

getting and keeping such people and to providing them with the incentive which will motivate them to

achieve higher levels of performance.

Management and reward

An organizations performance depends ultimately on the quality of its management and employees, and the

reward system can help to improve the quality. But the improvement of organizational; effectiveness cannot

be left to the reward system alone: the culture, values and management style of the organization, together

with its performance management and employee development programmes, are also important. Reward

systems, however well conceived and effective, are no substitute for good management.

Specific aims

From the organizational point of view, the specific aims of employee reward are to:

Ply a significant part in the communication of the organizations values, performance, standards andexpectations.

Encourage behavior that will contribute t the achievement of the organizations objectives and reflectthe balanced score card of key performance drivers. Two of the basic questions to be answered


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when developing reward system are what sort of behavior do we want? And how can reward

processes promote that behavior?

Underpin organizational change program concerned with culture process and structure Support the realization of the key values of the organization in such areas s quality, customer care,

teamwork, innovation, flexibility and speed of response

Provide value for money. No reward initiative should be undertaken unless it has been establishedthat it will ass value, and no reward practice should be retained if it does not result in added value.

(ii) The employees point of view

From employees point of view thereward system should:

Treat them as stakeholders who have the right to be involved in the development of the rewardpolicies that affect them

Meet their expectations that they will be treated equitably, fairly, and consistently Be transparent. They should know what the reward policies of the organization are and how they are

affected by them.


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Key Issues in Reward System

Essentials

1. Determining levels of rewardTo determine how much reward is appropriate, consider the question what level of employee reward will

attract, retain, and motivate people of the calibre that you require. If an employee does something that

results in a one-time boost for the company, a one-time incentive is most appropriate.

2. Rewards In Addition To WagesKeep in mind that the main reason why you are giving an employee reward is because you want

exceptional results, not comparable performance. Exceptional productivity will more than cover extra pay.- Employee rewards should be set for noteworthy achievements

- Rewards must be related to a particular completion of a given task

- Employees should be encouraged to express their recent achievements

- Ensure the employee knows they deserve it, it will have a great impression on their personality

3. Employee reward should never be an alternative for a reasonable remuneration schemeThis type of award should not be set as an enduring option to stable income amendments when, in fact,

these changes should be carried out for constant and regular completion of tasks, excellent execution, and

notable modifications in conscientiousness, or enhanced assessment of a status. Remember that employee

reward is a one-time incentive program; therefore, it should be set out clearly and must be understood well

by the employees so that they will know where to stand.

4. Employee rewards should not reflect the impression that these are changes to one's basic pay

It must be set out clear to the employees so that they will not expect anything more than what they have to

receive. Make it apparent that the extra pay is for special achievement only and nothing else. Generally,

employee rewards may be in the form of cash incentives or non-cash fringe benefits. It could even be

something of no real financial worth such as a personal letter of commendation.


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5. Reward by volume

If you have to use a monetary type of employee reward, give reward based on results. This means that the

employee gets a fixed amount for a specific amount of results. In theory, this gives the employee the best

incentive to maximize output. In fact, employees tend to put a ceiling on their earnings and thus on their

effort. Nevertheless, the key concept here is that the management should only give an employee reward thatis tied to an individual achievement. The reward must be reasonably large to have value - no one likes

getting an overly small reward as it could have the opposite effect and make the employee view the

company as cheap or undervaluing them. Never reward an employee for what has been accepted as a

sensible objective. It should be given for extraordinary achievements only.

Meaning of reward to people

Pay is frequently used as a motivator and reinforce on it can easily be differentiated and computed, linked,

clearly and visibly to direct performance and is generally valued reward. While outlined the major

components in the meaning of reward to people;

Short-term material enjoyment. Long term security,

Social status. Recognition of personal achievement.

Challenges

Perceptional Gap

Ganguli O,N, (1967), in his study found "pay and allowances as the most important factor causing

satisfaction or dissatisfaction to workers"

According to Fred Luthans (1981), "inequality occurs when an individual perceives that the ratio of his

outcomes to input and the ratio of relevant others outcome to input are unequal"

These findings indicate that the reward management system in an organisation highly influence member's

behaviour at work. We can see glaring example that some members are highly involved in the work

environment and some members doesn't. The possible explanation given by many authors on these

differences are intrinsic and extrinsic factors at work. A perceptional difference between what they have and

what others have, develop a feeling of inequality among members. High dissatisfaction, high stress and


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frustration etc are the resultant manifestation of this perceptional gap. The perceptional gap affects the

productivity and the performance of the members at work. Hence it is necessary to develop an effective

reward management system that reduces the perceptional gap.

Strategies to reduce "Perceptional gap"

1. See quantifiable goal for better evaluation of performance.2. Reward behavior towards accomplishment of tasks.3. Reward based on personnel choices of employees.4. Never reward indiscriminately.5. Compliment the action of individual.6. Develop objective criteria for reward eligibility.7. Communicate well the eligibility criteria for reward to each member.8. Make employee know the performance value.9. Develop reward system that match with the culture and values widely held by the organizations, 10.Ensure the accountability of the reward system across functional level. 11.Ensure top-level support in reward policy development and implementation.12.Develop a reward system that in tune with the organizational goal.13.Introduce individual and group reward system14.Set performance evaluation measure simple and understandable.15.Develop standardized performance evaluation indicators.16.Introduce performance related pay system.17.Make use of (ITMS) Integrated talent management software system to make it easy for managers to

calibrate goals

18.Provident training to members to aware of performance based reward system and management. 19.Celebrate the employee's success in completion of projects.20.Communicate the value of benefit offered.21.Invite suggestions of the members in the reward modification and restructuring process. 22.Ensure healthy competition to improve the effectiveness of competency based reward performance.23.Reward system should ensure opportunity to growth and development of members. 24.Ensure compensation package in tune with the personal life balance. 25.Superior performers to be motivated to exceed their expectation and mediocre performance will be

encouraged to improve performance.

26.Personally thank employee for a specific job well done.27.Share valuable and remarkable employee performance with top-level officials.


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28.Avoid favoritism and nepotism.29.Never make use of denial of reward as punishment behaviour.30.Motivate the subordinates through recognition and support.

Organizational culture and reward management system

Singh et. al. (1977) in a study of organizational culture and its impact on managerial remuneration concluded

that the demands for money was significantly influenced by the quality of organizational culture and that it

can substantially be reduced by improving the quality of organizational culture. Findings such as those

suggest that satisfaction, task involvement, demand for money and commitment are largely determined by

organizational culture. Recent researches on industrial unrest indicate that reward criteria of the

organizations both financial and non-financial rewards have tremendous influence upon the employees and

employers performance.

Lower quality of organizational milieu leads to higher level of expectations for monetary compensation. This

is so because such organizations do not gratify social and psychological needs of individuals. They lead to

subordination, dependence and submissiveness. Concern for money arises because of the basic incongruity

between the individual need system and the organizational demands. Coercive authority systemautocratic

and custodialaffects the motivational pattern. It de-emphasizes self actualization, growth process,

creativity and innovativeness and emphasizes the role of monitory rewards for the motivation. In the

absence of autonomy of work system and socio task grouping, higher order human needslove and

belongingness, ego, achievement and self-actualization are threatened. It hampers the growth of full

personality and leads to frustration and anxiety".

Higher the job satisfaction members have at work higher is the member's adjustment with the work and work

organization. The culture of the organization is an important factor, which conveys the policies, and

practices widely held by the organization. An organizational culture, which gives importance to employeessatisfaction at various level viz., psycho-social and economic needs, can develop better productivity and

performance at work. It reduces the perceptional gap on the reward management and performance

management system and ensures better involvement and commitment at work. A strong organization culture,

in which the employers take effort to reduce the perceptional gap in the reward management system and

induce trust and confidence among the employees at work.


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Factors Affecting Reward System

GlobalizationNeed to attract and retain high quality global managers.

RestructuringNeed to develop pay structures which fit and support delayered and flatter organization

and introduce methods of rewarding team work.

Culture changeUse of rewards to influence changes in culture, values and styles.

BehaviorRewards which drive and reinforce desired behaviors.

Product, market & technological developmentRewards support people with skills and competencies which are required.

Cost ManagementDeveloping affordable reward packages that will provide value for money.


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Types of Rewards

Monetary Rewards

The base pay

Base or basic pay is the level of pay that constitutes the rate of the job. The basic levels of pay for jobs

reflect both internal and external relativities. The internal relativities may be measured by some form of job

evaluation which places job in a hierarchy. External relativities are assessed by tracking market rates.

Alternatively, levels of pay may be agreed through negotiations. Base pay may be expressed as an annual,

weekly or hourly rate and it may be adjusted to reflect increase in the cost of living or market rates by the

organization unilaterally or by agreement with a trade union. Its the pay provided by an employer to an

employee for services rendered (i.e., time, effort and skill). Compensation comprises four core elements:

Fixed pay -- Also known as "base pay," fixed pay is nondiscretionary compensation that does notvary according to performance or results achieved. It usually is determined by the organization's pay

philosophy and structure.

Variable pay -- Also known as "pay at risk," variable pay changes directly with the level ofperformance or results achieved. It is a one-time payment that must be re-established and re-earned

each performance period. Short-term incentive pay - A form of variable pay, short-term incentive pay is designed to focus and

reward performance over a period of one-year or less.

Long-term incentive pay -- A form of variable pay, long-term incentive pay is designed to focus andreward performance over a period longer than one year. Typical forms include stock options,

restricted stock, performance shares, performance units and cash.

Individual performancerelated pay

In this pay increases in the base pay or cash bonuses are determined by performance assessment and ratings

Bonuses

Rewards for successful performance which are paid as lump sums related to the results obtained by

individuals, teams or the organization.


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Incentives

Payments linked which the achievement of the previously set targets which are designed to motivate people

to achieve higher levels of performance. The targets are usually quantified in such terms as sales or output.

Commission

A special form of incentives in which the sales representatives are paid on the basis of a percentage of the

sales value they generate.

Servicerelated pay

Which increases by fixed increments on a scale or pay spine depending upon the service in the job. There

may sometimes be scope for varying the rate of progress up the scale according to the performance.

Skillbased pay / knowledgebased pay

It varies according to the level of skills the individual achieves.

Competencerelated pay

It varies according to the competence achieved by an individual.

Career development pay

Rewards people for taking on additional responsibilities as their career develops laterally within a broadgrade.

Allowances

Elements of pay in the form of a separate sum of money for such aspects of employment as overtime, shift

working, call outs and living in large cities.


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Administrative salary supplements

Employees who assume new/additional responsibilities on an interim basis may receive administrative salary

supplements that are paid in addition to the base salary. The supplement is discontinued when the employee

is no longer responsible for the additional responsibilities.

Social Insurance

Unemployment Workers' compensation Social Security Disability (occupational)

Group Insurance

Medical Dental Vision Prescription drug Mental health Life insurance AD&D insurance Disability Retirement Savings

Pay for Time Not Worked

These programs are designed to protect the employee's income flow when not actively engaged at work.

At work (breaks, clean-up time, uniform changing time) Away from work (vacation, company holidays, personal days).


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NonMonetary Reward

Praise/recognition from supervisor

Praise and recognition from supervisors is consistently found to be among the most important motivators.

Employees want to be recognized and feel their contributions are noticed and valued. It is important that

supervisors recognize the value and importance of sincerely thanking employees verbally and/or in writing

for their specific contributions

Challenging work assignments

Challenging/new work assignments are another mechanism available to supervisors to reward good

performance. Such assignments can provide employees opportunities to develop new skills, expand their

knowledge, and/or increase their visibility within the organization. They also send an important message that

employees contributions are recognized and valued. In considering such assignments, supervisors should

consult employees about the types of assignments that would be most valued, and they should also assess

whether workloads will need to be redistributed to ensure employees have adequate time to devote to new

tasks

Professional growth and development opportunities

Supervisors may provide employees opportunities to participate in educational programs or other activities

that will expand their skills/knowledge. Employees benefit by developing new skills, and the institution

benefits from the additional expertise individuals bring to the job. Nelson notes a recent survey found that

87% of responding workers viewed special training as a positive incentive, and it appeared most meaningful

to employees with postgraduate education. A plan for an employee to advance their own career goals and

may include advancement into a more responsible position in an organization. The organization supports

career opportunities internally so that talented employees are deployed in positions that enable them to

deliver their greatest value to their organization.


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Development and career opportunities include the following:

Learning Opportunitieso Tuition assistanceo Corporate universitieso New technology trainingo Attendance at outside seminars, conferences, virtual education, etc.o Self-development tools and techniqueso On the job learning; rotational assignments at a progressively higher levelo Sabbaticals with the express purpose of acquiring specific skills, knowledge or experience.

Coaching/Mentoringo

Leadership trainingo Access to experts/information networks -- association memberships, attendance and/or

presentation at conferences outside of one's area of expertise

o Exposure to resident expertso Formal or informal mentoring programs; in or outside one's own organization.

Advancement Opportunitieso Internshipso Apprenticeships with expertso Overseas assignmentso Internal job postingso Job advancement/promotiono Career ladders and pathwayso Succession planningo Providing defined and respectable "on and off ramps" throughout the career life cycle

Paid leave

Supervisors may award employees up to 32 hours of paid leave annually in recognition of meritorious

performance


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Promotion and lateral moves

Promotions and lateral moves may be long term rewards that recognize employees professional growth,

expertise, and capacity to contribute to the institution in new roles. Promotions are typically associated with

an increase in salary, and the increase may be any amount up to 10% of an employees current salary. For

employees with base salaries under $25,000, the increase may be any amount up to $2,500. The new salary

also must be within the salary range approved for the position, and employees are subject to a 90-day

probationary period following a promotion/lateral move to a new department

Informal rewards

When warranted, supervisors may choose to give employees informal rewards for specific

accomplishments/contributions. State law and institutional policy allow expenditures of up to $50 of state

funds and $100 of non-state funds per employee for informal non-cash rewards that demonstrate the

supervisors/institutions appreciation. Supervisors can be creative in identifying informal rewards that will

be appreciated by the particular individual being recognized, but, in selecting and purchasing rewards,

supervisors must be sensitive to the institutions responsibility to be good stewards of public funds.

Others

Dinner certificates, A trophy or plaque, Cash bonus, Pizza party thrown in the recipient's honor, or for an entire group that has done a great job, Bonus miles for airlines, A "top achiever" ribbon, A reserved parking space, An extra paid day off, Movie passes.


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Total Reward System

Total reward programmes, which integrate both financial and non-financial incentives to reward staff,

can offer an organization the building blocks to help incentivize, recognize and motivate employees to

deliver improved levels of performance.

While achieving competitive advantage in selling products or delivering outstanding customer service is the

crucial element in the success of many businesses, it can be argued that, similarly, competing for, retaining

and incentivizing talented employees is equally as important. And in todays business environment just

maintaining a competitive pay policy is no longer the benchmark as a report by the Professional

Association for Compensation points out, more organizations are now considering leveraging "all of the

tools available to the employer to attract retain and motivate employees".

Improved performance

Total reward theory supports the concept that employees will show higher levels of performance and

productivity if they feel valued by the organization. The relationship between this feelings of value is

reciprocated by the organization through offering relevant financial and non-financial rewards. These should

be in line with employees needs and wishes, the strategic direction of the business and what the business

values from its employees.

It also aims to reinforce an organization as an employer of choice by promoting its reward policies and

practices as a total reward package with the focus on meeting the needs and expectations of employees,

rather than a collection of HR reward and development policies. It builds upon four basic building blocks of

what is seen to be important to employees, and is part of the overall motivational mechanism seen in well-

performing organizations.

Compensation:providing differential compensation to employees based on performance. Informal recognition: day to day recognition of performance, most importantly by the immediate

manager.

Honorifics:recognition elements. Promotion prospects:advancement and development opportunities.

Total reward solutions are presented in many forms, with models that range from reflecting three, four and

even six key elements in their design. For example a simpler model might look at pay, benefits, learning and

development, and the work environment, while a slightly more ambitious program might touch on tangible

rewards, future growth and opportunity, enabling the work environment, the quality of work, work/life

balance, and inspiration and values. The models can potentially utilize a vast array of motivational and

reward factors.


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Whilst this is not an exhaustive list, it is representative of what organizations use. Each factor on its own can

play a part, however, the benefit to employer and employee is in combining relevant factors to offer a

comprehensive package that is linked, integrated and provides a menu to help motivate employees.

Inevitably with options comes the question of what to include, but more important is how the organization

obtains the maximum value from those choices. For each factor the business should consider what it wishes

to receive in return from employees. Many organizations have entered the total reward arena with a small

focused selection of factors representing only financial and non-financial elements. Each element (or

combination of elements) should exist for relevant strategic and operational reasons, as removing or

replacing factors at a later stage could undermine the purpose of the whole model. \

Total reward statement

Often with the type of transactional model, mentioned above, employers provide employees with annual

total reward statement, which details what individuals are entitled to and the financial worth of their

respective elements beyond basic pay. Additionally, they can make employees more engaged with the

organization by helping them to understand how much they are getting from the employer, which may make

them more inclined to stay on and be more motivated.

Determining the mix of total reward factors may be strategic or tactical depending upon the needs of the

business. For example, executive compensation is often more focused on financial values and total reward

may be replaced by total compensation. This is in part due to the fact that executives usually have

sufficient flexibility in their organizational roles to be able to organize their work, influence their

development opportunities, generate interesting and challenging work, and as a result, partly meet their

motivational needs.

Hence total reward tends to focus on ensuring that the compensation elements, namely salary, benefits, short-

and long-term incentives and perquisites are (a) competitive, and (b) suitably structured to influence

performance and behavior. Depending upon the requirement, the elements can be used; however, executive

compensation design must also reflect good governance.

At the tactical level, total reward solutions can be designed to operate across a broader spectrum of

employee groups and incentivize and motivate them accordingly. For example the effective use of voluntary

benefits within Total Reward can provide employers and managers with the opportunity of identifying and

recognizing individual or team performance by providing aspirational non-cash rewards. Work-life

provisions, now common practice in many organizations, provide valued flexibility around employment

hours and work patterns.


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Linking total reward to learning and development, relevant career advancement and succession plans for

individuals or roles, which in turn are reinforced through pay, progression and incentive mechanisms,

present a compelling statement of the employment landscape within the organization.

Arguably, if a total reward model is to contribute to incentivizing and motivating employees, this will not be

accomplished without good line management and effective performance management activities. Effective

business performance centers on the ability and capability of line managers to utilize all the physical and

psychological employment dimensions at their disposal, of which total reward components feature

predominantly.

Primary elements of a total reward system

Base Pay

1. To reflect market competitiveness

2. Specific role of each individual

3. Competencies

4. Values of the organization

Base Pay

VariablePerformance

Total


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Variable Compensation

1. Create opportunities for sharing in results.

2. Tied to economic factors of success

3. Team or individual oriented

4. Relates to results

Performance Management

1. Measure & Goals

2. Feedback

3. Reinforce desired behaviors

Total Rewards journey in terms of philosophy and implementation has been undergoing a constant change

over the years. The desired end result of Total Rewards approach is: a satisfied, engaged and

productive group of employees who, in turn, create the desired business performance and results.

The aim of Total Rewards has remained the same over the years but the levers that are being

identified under Total Rewards and their importance has been shifting year on year. The Total Rewards

journey can be clearly demarcated into 3 stages:

Stage 1: Total Rewards = Total Compensation

Led to debate that transactional components alone cannot achieve the desired end result. Total Compensation is an important and necessary lever of Total Rewards but is not a

sufficient lever for attracting, retaining and motivating employees.


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Stage 2: Integrated Model of Total Rewards

Total Rewards refers to the transactional and relational levers provided to employees in exchange

of their time, talents, efforts and results. The key levers in the integrated model are stated below

Stage 3: Unique Integrated Model of Total Rewards

Total Rewards refers to the unique and propriety way in which organizations use the leversto attract, retain and motivate employees. This model abandons the one size fits all

approach and focuses on providing innovative and customized levers of Total Rewards.

Not a refutation of the earlier models but it is a refinement and elaboration of the earliermodels. The new model seeks to better elaborate all the levers that drive attraction,

retention and motivation in a manner that best fits not only the workforce but customizes it

to individuals within a workforce.

Organizations irrespective of their size are adopting this approach to keep their flock together.Hence some of the steps that organizations are taking towards creating a unique Total Rewards

experience range from broad based organization wide practices to customized individual practices.

Benefits Work Experience Compensation

Compensation

Benefits

Work Life

Performance &

Performance

&

Results

Business

Employees

Satisfaction &

Engagement


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Definition & Levers of Total Rewards

Transactional Levers

Total Compensation Pay provided by the employer to an employee for services rendered

includes both fixed and variable pay tied to levels of performance

Benefits Program used to supplement cash compensation that employees receive.

Provides security for employees and their families

Relational Levers

Work Life A specific set of organizational practices, policies, programs

supporting employees achieve success at work and home

Performance

&

Recognition

Performance: The alignment of organizational,

team and individual efforts towards achieving

goals and organization success

Recognition: Acknowledging employees actions, efforts, behaviour

that meet an intrinsic psychological need for appreciation efforts and

reinforce certain behaviours

Career

Development

Learning experiences designed to enhance employees applied skills and

competencies to Advance their career goals. Aim to engage employees

and deploy of career opportunities internally.


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A Snapshot of Innovative and Unique Total Reward Practices

3G: Providing an ATM centre, gaming arcades, multicuisine restaurants, even fitness and beautycenters for employees to unwind within the office premises, offer higher education

programmers with tie- ups with premier institutions

Eon Technologies:Tele-commuting, flexi-time and retreats focused on team building SAP:Provide everyone with an opportunity to handle an international assignment, offer wide

range of global projects

Tesco: Maternity, paternity leave, also adoption leave. In house learning centre, employees canregister for a retail certification course from Indian Institute of Management

Xansa:Focuses on facilities for women - crche facilities, has a policy of no graveyard shifts (Xansacaters to the UK market), facility for yoga classes, psychological counseling sessions,

regular medical check-ups, benefits around flexi-time, sabbaticals and adoption leave

Infosys:Provide rigorous training programmes which involve several levels of certification,ensure that the campus environment is collegial, and control the ratio of managers to

employees.

Total Rewards Philosophy at Wipro

Total Rewards is fair recognition given to ones contribution to the organization. At Wipro, Total Rewards

are look as an enabler to build a strong Rewards mechanism focusing on:

a. Attracting the right talent.b. Compensation that is positioned competitively.c. Driving higher performance that is recognized and appreciated.

From Compensation to Total Rewards

Today differentiation driven by performance forms the basis of compensation. Wipro has realized that annual

salary increases do not have a significant impact in retaining critical talent. A good mix of offerings including

the right kind of roles, career opportunities, investment in employees development and a good brand is the

global demand. Wipro stayed on course with respect to equity based Long Term Incentives where they use a restricted

stock plan. They have believed in the significance of these instruments and have extended it to significant

contributors and employees with a long term stake in the organization.


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More than just Compensation for future employees

The spectrum of work at Wipro is very appealing to young engineers. While compensation is competitive, a key

highlight of their offer for youth is their education initiatives like tie ups with universities abroad and in India.

Wipro places a high premium on merit and so have stayed away from age based promotions. Growth is in

the hand of an individual. Developmental needs of employees are important and senior leadership including Mr.

Azim Premji conduct training sessions during the year.

Total Rewards in High Performers Management

At Wipro, they begin with a thorough talent review and planning exercise wherein Mr Azim Premji, Business Unit

Heads and HR spend up to 10 working days. Once high performers and critical role holders are identified,

suitable actions taken may include role enhancement, allocation to different leaders for differentiated

compensation. They also have Global leadership alliances in collaboration with global corporations where they

nominate their future leaders. For them, recognizing and rewarding high performers is not by making

poster boys of them, but by investing in their growth.

Total Recognition at Wipro!

To foster a feeling of oneness in the company, the organization has heavy emphasis on group initiatives and

these are captured as team photos. One of their innovative recognition programs is the Dear Boss award. Contrary to

the norm, team members give an award to the boss, through a pre-defined process. To reinforce and

appreciate an employees continued stay, cash awards seem insufficient. In these cases, they have Club 10 and

Club 15 programs where they sponsor holidays for employees and their families for achieving these

milestones.

Total Rewards at Sun Microsystems.

Compensation is an important component of Sun's employee lifecycle engagement strategy. Total rewards plays

an important part in driving execution of business strategy and aims to

Drive performance Attract and retain talent Encourage teamwork


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Through the years

At Sun globally, the key change has been the focus on performance driven pay through the incorporation of

variable component even at lower levels in the organization. They have a higher variable component; sometimes

as much as 50% for senior levels and functions where performance is directly measurable, while it is lower for

the others. In India, compensation is heavily cash focused; they follow a la carte approach, which gives

employees adequate choice. They are shifting their focus gradually away from benefits (as was traditionally defined)

with the objective of greater transparency in their compensation structure.

Managing High Performers

Suns performance management system identifies High Performers at the global level in the organization. They

adopt a differentiated compensation strategy; top performers could get up to twice the increments of average

performers. Managers are encouraged to reward innovation and teamwork and they too are rewarded for

developing leaders in their teams. For High Performers they also focus on their accelerated development. They have a

worldwide mentoring program, SEED, where employees are mentored by the best thought leaders in the organization.

Every year, there are 2530 employees from India who benefit from this initiative.

Recognition at Sun

They recognize their talent through both monetary and non-monetary initiatives. They have spot bonuses

where managers reward subordinates for their contributions to specific initiatives. These could range from Rs.

5000 to Rs. 1 Lakh. They have monthly and annual awards for contributions, which are more long term. At their

R&D center, nomination for these awards can also be through peers. Other interesting developmental and

recognition programme recognizes young thought leaders by nominating them to represent Sun at

external forums like technical conferences. Apart from this they have several recognition programmes for

employees on a global level. They also have a patent bonus award, which provides monetary recognition each time an

idea is accepted by the Sun patent office. This reinforces their belief in encouraging innovation.

Total Rewards and Retention?

Total Rewards is only an enabler to retain talent, and not the decisive factors in promoting change. Attrition is afunction of a multitude of factors, and at Sun less than 10% of exiting employees have cited compensation

as the reason for quitting.

The results

In summary, a well-designed and effectively communicated Total Reward offering should result in:

Improved recruitment of better-quality staff. Reduction in wastage from staff turnover and employment costs. Improvements in business performance.


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Establishment as an employer of choice. Reinforcing appropriate behaviors.

Providing a channel to aid the communication of the employers offering to its employees. Reinforced commitment through allowing employees choice over what they want from their employer. The organization maintaining overall control of the options available to individuals. A more motivated and committed workforce.

GUIDELINES UNDER REWARD SYSTEM

How to Provide Effective Employee Recognition

Prioritize employee recognition and you can ensure a positive, productive, innovative organizational climate.

Provide employee recognition to say thank you and to encourage more of the actions and thinking you

believe will make your organization successful. People who feel appreciated are more positive about

themselves and their ability to contribute. People with positive self-esteem are potentially your best

employees. These beliefs about employee recognition are common among employers even if not commonly

carried out. Why then is employee recognition so closely guarded in many organizations?

Time is an often-stated reason and admittedly, employee recognition does take time. Employers also start out

with all of the best intentions when they seek to recognize employee performance.

They often find their efforts turn into an opportunity for employee complaining, jealousy, and

dissatisfaction. With these experiences, many employers are hesitant to provide employee recognition.

Employee recognition is scarce because of a combination of several factors. Peop le dont know how to

provide it effectively, so they have bad experiences when they do. They assume one size fits all when they

provide employee recognition. Finally, employers think too narrowly about what people will find rewardingand recognizing. These guidelines and ideas will help you effectively walk the slippery path of employee

recognition and avoid potential problems when you recognize people in your work place.


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Guidelines for Effective Employee Recognition

Decide what you want to achieve through your employee recognition efforts. Many organizations use a

scatter approach to employee recognition. They put a lot of employee recognition out there and hope that

some efforts will stick and create the results they want. Or, they recognize so infrequently that employee

recognition becomes a downer for the many when the infrequent few are recognized.

Instead, create goals and action plans that recognize the actions, behaviors, approaches, and

accomplishments you want to foster and reward in your organization. Establish employee recognition

opportunities that emphasize and reinforce these sought-after qualities and behaviors. If you need to increase

attendance in your organization, hand out a three-part form, during your Monday morning staff meeting. The

written note thanks employees who have perfect attendance that week. The employee keeps one part; save

the second in the personnel file; place the third in a monthly drawing for gift certificates.

Fairness, clarity, and consistency are important.People need to see that each person who makes the same

or a similar contribution has an equal likelihood of receiving recognition for her efforts. I recommend that

for regularly provided employee recognition, organizations establish criteria for what makes a person

eligible for the employee recognition. Anyone who meets the criteria is then recognized.

As an example, if people are recognized for exceeding a production or sales expectation, anyone who goes

over the goal gets the glory. Recognizing only the highest performer will defeat or dissatisfy all of your other

contributors, especially if the criteria are unclear or based on opinion.

For day-to-day employee recognition, youll want to set guidelines so leaders acknowledge equivalent and

similar contributions. Each employee who stays after work to contribute ideas in a departmental

improvement brainstorming session gets to have lunch with the department head.

This guideline is why an employee of the month-type program is most often unsuccessful. The criteria for

results and the fairness of these criteria are not clear to people. So, people complain about brown-nosing

points and the bosss pet. These programs cause discontent and dissention when the organizations

intentions were positive.

As an additional example, it is important to recognize all people who contributed to a success equally. A

CEO I know perpetually announced employee recognition for major projects at the company holiday

celebration. Without fail, he missed the names of several people who contributed to the success of the

project. With the opportunity for public recognition past, people invariably felt slighted by the post-banquet

thanks.


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Patni Computer Systems, Ltd

Patni Computer Systems Ltd. (Patni) (BSE: PATNI COMPUT, NSE: PATNI, NYSE: PTI) is one of the

leading global providers of Information Technology services and business solutions. Over 15,000

professionals service clients across diverse industries, from 22 sales offices across the Americas, Europe and

Asia-Pacific, and 20 Global Delivery Centers in strategic locations across the world. They have serviced

more than 400 FORTUNE 1000 companies, for over two decades.

Their vision is to achieve global IT services leadership in providing value-added high quality IT solutions to

their clients in selected horizontal and vertical segments, by combining technology skills, domain expertise,

process focus and a commitment to long-term client relationships.

Patni delivers high quality, reliable and cost-effective IT services to customers globally. They provide

world-class technology services by constantly exploring and implementing innovative solutions that drive

long-term value to their customers.

Asindustry leaders,they introduced offshore development centers, pioneered "follow the sun" development

and support frameworks, ensuring compressed delivery timeframes.

Today, their solutions provide strategic advantage to several most-admired organizations in the world. Patni

have long-standing and vibrant partnerships with over 300 companies across the globe.

Employee Recognition Program

Objective:

To recognize and appreciate the special contribution and excellent performance of the employees inthe organization

To encourage and motivate the employees to achieve higher level of effectiveness and excellence
http://www.patni.com/services/it-services/it-services-overview.htmlhttp://www.patni.com/global-sourcing/global-sourcing.htmlhttp://www.patni.com/global-sourcing/global-sourcing.htmlhttp://www.patni.com/services/it-services/it-services-overview.html


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1. General Eligibility Criteria for Awards: The scheme is applicable for all the employees at SC level (level 6) and below in software and

equivalent levels in other functions

Criteria for each award category are given below. In order to qualify for the award the employee isexpected to satisfy majority of the criteria, though not all of them.

The citation, which is given, should be supported wherever possible with quantifiable data,appreciation letters from customers/ seniors and peers.

For Team awards factors such as teamwork, updating each other, chipping in for other person,boosting morale of the team, taking ownership responsibility and coordination amongst each other

should be considered.

Factors such as commitment to company objective and policies, good interpersonal relations,commitment to the project or the task assigned should also be weighed along with the specific

criteria mentioned below

In the event of nomination not meeting the criteria, no award should be granted.

2. Types of Awards:2.1 Annual Awards

2.1.1 Business Development Award (BDA):

Eligibility: An employee could be nominated for BDA if:

The person creates significant potential for new business with the existing customer The person creates new opportunities for new business generation/ helped in establishing

relationship with new customer.

The person develops a pilot project, which helped in new business generation with the existingcustomers/new customers.

2.1.2 Superlative Performance Award. (SPA):

Eligibility:An employee may be considered as an eligible nominee for the SPA if

Performance has been outstanding and Sustained over the entire period under consideration forwhatever responsibility he/she is assigned.

Performance has been the key factor in the success of the significant and strategically importantproject or assignment.

Performance has been influential enough to create potential for new business from the customerassignments/responsibilities.


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The Persons performance can be considered as exemplary in the organization and he/ she couldbe the role model in the organization.

2.1.3 Excellent Performance Award (EPA):

Eligibility: An employee may be considered as a nominee for EPA if:

Performance has been outstanding over most of the period under consideration in each and everytask assigned.

Performance has been important factor for the success and strategically important for the givenproject / assignment.

Output has exceeded expectation on the assignments consistently. The person has surpassed his/her peers engaged in similar kind of assignment or responsibilities

2.1.4 Presidents Quality Contribution Award (PQCA):Eligibility: An employee could be nominated for PQCA if:

In Quality role

The person has contributed in capturing of all the defect data associated with testing The person has uncovered significant defects in Work Product before delivery to the customer

In Producer Role

The person has produced code, which meets all defined standards. The person has done appropriate test planning consistently. No defect has been found in the code produced or impacted in his/her work within the given task.

Additional Criteria

The person has to be the recipient of the Monthly Quality Contribution Award (MQCA)

Sustained contribution during the entire period under consideration

2.1.5 Team Awards (TA):

This is a Non monetary award in the category of the Annual awards.

Eligibility:Team can qualify for this award if:

The work Schedule has always been met during the period under consideration. The output of the team as a whole has surpassed the expected volumes and quality requirement: The members of the team have displayed high level of mutual cooperation and team spirit Innovative approaches were successfully adopted resulting in substantial gains to the company


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For a Team award to be given to a team the size of the team should be more that 7 and it shouldhave worked together for more than 4 months

2.1.6 Nomination criteria:

The nominations for all the award are solicited by the HRD in and around mid November eachyear

The nominations or recommendations for the awards are received through Peer, GL/PL, Projectmanager, and senior managers.

For CQA nominations should be selected from MQCA awards winner only.2.1.7 Evaluation Criteria:

Group HR/SBU HR initiates the process by soliciting the nominations for the respective awards. The committee headed by the SBU head does the first level scrutiny at SBU level. These

nominations are then sent to the Corporate HR for further processing.

Corporate HR shall constitute a committee to scrutinize received nominations from all SBUs. The committee is constituted of senior representative (C/SC/Mgrs) from each SBU and functions. A person not below SC level shall head the committee. The number of members should not exceed more than nine people. The final selection of Award winners shall be by the process of comparative evaluation of merits

in relation to the set norms.

The MG COM will approve the final list and Head- Human Resources shall make theannouncement of Awards.

2.1.8 Distribution of Awards:

The Resident Director shall present SPA/EPA/BDA to the winners on the annual day and theSBU/ Department head shall present the Team awards.

The CHR shall send the certificates for those who are onsite or transferred to different locationthrough courier.

Those absent at the award ceremony but are in India, get their certificates and citation through theCHR at their respective locations.

The photographs of the award winners are displayed on the notice board, Intranet and ispublished in Bit n PCS

The nominations of the missed out employees are filed in their respective personal files.


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2.1.9 Disbursement of the Award Amount:

Each award has a citation and a certificate. For BDA, SPA, EPA winners cheques for the valuewill be issued after the normal accounting procedure.

The Cash award winner could also exchange their cash award against the appropriate gift theycould select from the gift catalogue made available to them.

Numbers and Value of the Annual Awards

Award Cash Value (Rs) No of Awards Per annum

BDA 3500 1 for all Software group together

SPA 6500 Maximum 4 per thousand employees

covering all functions of the Company.

This would not depend on no. of employees

in SBU or Department. This award is for

Individuals achievement

EPA 3500 Max. 2 per SBU/Dept employees covering

all functions of the company

AQCA 6500 Max 1 in all software group together

TA T shirts (no cash) Max 12 teams covering all functions of the

company


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The size of the team should be more than 7 and the as a group the should have worked for morethan 4 month or in the given quarter

2.2.4 Nomination

As the quarterly awards are given throughout the year for each quarter, there is a separate nomination

procedure.

The nomination for the quarterly awards could be received from Peer, GL/PL, and Projectmanagers.

The nominations should be solicited nearing the end of the quarter. Any employee or team can propose a person including him/herself in a prescribed format. The PL and PM add their comments and the filled forms are submitted to the SBU HR of the

respective SBU

2.2.5 Evaluation Criteria:

A committee is constituted in the SBU who reviews the received nominations and finalize the listof the winners

The three-member committee consists of the SBU/function head and two senior employees(C/SClevel).

The SBU HR forwards the final award winner list to the CHR who arrange for the award andcitation.

2.2.6 Distribution of Awards:

Since each SBUs have their respective nominations, most of the quarterly awards are given away as below:

The Quarterly awards are handed to the employees by the SBU head in the Group meetings The Announcement of the awards is made in the first week of the consecutive quarter. In case the employee is absent for the meeting he/she collects the award and its citation later from

the SBU HR

2.2.7 Disbursement of the Award:

All quarterly awards carry a citation and a certificate. For VCA winners the cash award could be reimbursed

as against receipt for books or Dinner.


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2.3 Ongoing Appreciation Awards (non monetary)

Recognitions made throughout the year and rewarded instantly

2.3.1 Letter of Appreciation

Eligibility: The letter of appreciation will be given when a person does a good job with efficiency and

proper efforts.

The respective reporting officer will give this letter to the subordinate.

2.3.2 Nomination

For letter of appreciation, Peers, GL/PL and the project manager could nominate the employee. The list is sent to SBU HR who prepares the letters and sends them to reporting officer. For Bravo Cards since it is given on the spot a stock of cards is made available to the reporting

officers

2.3.3 Distribution of award:

In the Letter of the Appreciation, SBU HR after getting the nominees list prepares the letters andhand them to the respective reporting officer.

The Reporting officer hand over the letter to the employee personally along with a memento. Corporate Administration department maintains a stock of mementos and the bravo cards on

requisition of the SBU HR and hands it during the respective SBU/ group presentation.

Award Value No of Awards to be nominated

VCA 1000

Max 3 percent of software group

employee strength and up to 2

percent of the employee strength of

function in case of non software

QCA Revolving Plaque Max 1 for each software group

QTA T shirts Max 1 team for each SBU


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GLAXO-SMITH KLINE

Established in the year 1924 in India GlaxoSmithKline Pharmaceuticals Ltd. (GSK Rx India) is one of the

oldest pharmaceuticals company.

GSK worldwide

Our mission is to improve the quality of human life by enabling people to do more, feel better andlive longer

We are a research-based pharmaceutical company We are the only pharmaceutical company to tackle the three "priority" diseases identified by the

World Health Organization: HIV/AIDS, tuberculosis and malaria

Our business employs over 100,000 people in 117 countries We make almost four billion packs of medicines and healthcare products every year Over 15,000 people work in our research teams to discover new medicines We screen about 65 million compounds every year in our search for new medicines We supply one quarter of the world's vaccines and by the end of February 2007 we had 23 vaccines

in clinical development

In 2006 we donated 155 million albendazole tablets to help eliminate lymphatic filariasis(elephantiasis), making almost 600 million treatments in total

In 2006 our global community investment was 302 million, 3.9% of profit before tax

GSK India

In India, GSK is one of the market leaders with a turnover of Rs. 1500 crore and a share of 6.2 percent [source: IMS Indian Purchase Audit (IIPA), August 2007]

GSK leads in several therapeutic segments - dermatology, anti-parasitics, hormones, and anti-infectives (source: IIPA, August 2007)

GSK has six products in the top 50 brands, and the top five GSK products are Augmentin, Zinetac,Calpol, Phexin, and Betnesol (source: IIPA, August 2007)


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GSKs vaccines division is ranked first in a fast-growing vaccines market. Some leading productsin India are Havrix, Varilrix, Hiberix, Engerix B and Tritanrix (source: IIPA, August 2007)

GSK Indias R&D centresat Thane and Nashik have been granted recognition by the Departmentof Scientific and Industrial Research, Government of India

The number of clinical studies conducted in India is rapidly growing across a range of therapy areas GSK Indias social responsibility programmes focus on development of under developed villages,

women and children , specifically in the areas of healthcare and education

Product Portfolio

The GSK India product portfolio includes:-

Prescription medicines: Therapeutic areas such as anti-infectives, Dermatology, Gynecology, Diabetes, Cardiovascular disease

Respiratory diseases.

Vaccines: Hepatitis A, Hepatitis B, Invasive disease caused by H, Influenza, Chickenpox, Diphtheria, Pertussis, Tetanus and others.


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Score card of GSK

What is recognition?

It is the visible acknowledgement and appreciation of contributions made by teams and individuals

This recognition program is:

Complementary to GSK employee compensation schemes. Aligned to the GSK recognition framework


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Wherever possible they expect projects to reflect the key principles of Lean Sigma:

Make value flow at the pull of the customer. Continuously improve knowledge in pursuit of perception. Specify value in the eyes of the customer. Identify the value stream and eliminate waste / variation. Involve, align and empower employees.

Lean Sigma methodology will help to provide them with the route to world class performance. Integrating

the approach into their daily work is a key requirement to enable them to reach their challenging goals.

These categories provide a flexible format allowing nominators to select and recognize a range of projects,

activities or behaviors which help GMS achieve its mission.

Goals of the GMS Excellence Recognition

Thank employees for outstanding performance. Provide a consistent approach to timely recognition that can be applied across the whole GMS

organization at team, supply division and business levels

Recognize desired behaviors of teams and individuals, in line with the GSK Spirit ways of workinghelp GMS achieve world class performance

Help to formalize consistent good management practice and build a shared culture of excellence Recognize and encourage the sharing of knowledge and good practice across the organization.


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The structure of GMS Excellence Recognition

Informal Recognition

Everyone is encouraged to recognize their colleagues achievements spontaneously, through the use of

Bravo! Cards, to acknowledge support from a colleague, or a job exceptionally well done.

Formal Recognition

Formal recognition enables the company to recognize exceptional performance by means of a congratulatory

letter, a GMS certificate and token financial reward. The level of recognition for formal awards depends

primarily on the scale of impact on their organization.

Work Area Awardfor excellent activities which impact on immediate work area. Site Awardfor excellent activities with site / function area impact. Supply Division / Functional Award for excellent activities with multi-site / function-wide area

impact

GMS Presidents Roll of Honourfor exceptional activities, typically with GMS wide or GSK-wideimpact.

The process of recognizing GMS excellence

Informal recognition

Anyone can instantly recognize an individual or a team for a job exceptionally well done, by sending them

Bravo! card. The cards will be held by HR department. There is no need of any authorization to send

someone Bravo! card.

Formal Recognition

Nominating people for excellence awards

Anyone can nominate an employee or team for an award at any level. To do this the nominator required the

approval of his or her manager and, for budget purposes, the approval of nominees manager.


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How GMS Excellence is recognized

For all awards, a formal award approval process should be followed as shown in table below. It is recommended that

the existing management teams carry out this task, although special award panels may be established if preferred. All

award panels should include both HR and OE representation.

Functional activities will normally be included within site and supply division reviews. Where a functional

achievement is not related specifically to a site or supply division, it will be assessed within the functional structure.

In all instances nomination can either:

Progress upwards from the initial category, on recommendation of the review team, or Be entered directly into a higher category if selected by the nominator.Awards can be granted as follows:

Scale of impact Nominated by Approved by

Minimum

recommended

award review

frequency

Immediate work

area

Colleague/ Manager

Nominates person(s) to a

manager for a work area

award

Work Area Manager

Puts forward any

nominations to the site

award panel

Site management /

Award panel

Reviews nominations

and where supported

Sends recognitionletter

Arrangesrecognition &

knowledge sharing

event where site

award & GMS

certificate is given

Event should also

Monthly

Site / equivalent

functional area

Work Area Manager

Puts forward any

nominations to the site

Award Panel or

Monthly


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Functional Award Panel include recognition

of activities at work

area level which

received awards in

that quarter

Where nominationis not supported,

inform nominator

Supply Division/

equivalent

functional area

Site Mgt / Award team

Puts forward any

nominations for the

supply division /

functional award panel

Supply Division/

Functional Award

Panel

Reviews nominations

& where supported

Sends recognitionletter

Arrangesrecognition &

knowledge event

where awards &

GMS certificates

are given

Where nominationis not supported,

inform nominator

Quarterly or half-

yearly

GMSwide

Supply Division /

Functional Award Panel

or Leadership Team

GMS Executive Team

Supply Divisions &

Functions recommend

projects for PROH.

These are reviewed by

the GMS Executive

team. Where

nominations are

Annually


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supported:

Successfulnominations

receive email from

the president & a

certificate

Projects aredisplayed on the

GMS Community

Panel (website)


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Sandoz

Sandoz is a global generics leader. They save and improve lives by developing, producing and distributing

high-quality, affordable pharmaceuticals. Sandoz medicines are now available to 90% of people worldwide.

In addition to direct cost savings to patients, they contribute to the stability of healthcare systems worldwide

and free up resources for new and innovative medicines.

Sandoz isa Novartis company with a reputation for quality going back toits roots in the 19th century(foundation of Sandoz by Edouard Sandoz in 1886).

The Sandoz Vision is to be the main provider of high quality, affordable medicines helping securelong-term access to healthcare for people around the world.

Sandoz, a global generics leader, develops, produces and markets medicines that are no longerprotected by patents, along with pharmaceutical and biotechnological active substances.

Sandoz offers patients more than 950 molecules in over 5000 forms worldwide. Sandoz medicines are available to about 90% of the worlds population. Sandoz produces far more than just traditional off-patent products. We differentiate ourselves from

other companies by developing and producing difficult-to-make generics that require an

exceptionally high degree of expertise and knowledge and often involve complex high-tech delivery

systems. These range from oral solids and inhalers through patch technologies to state-of-the-art

biosimilarsapproved versions of biopharmaceutical medicines. Sandoz has eight major global development centers and a worldwide network of production sites and

technology centers of excellence.

Sandoz reported generic pharmaceutical sales of USD 7.2 billion in 2007 and employs more than23,000 associates in 130 countries.

Recognition at Sandoz

ObjectiveBring in achievement orientation amongst employees and thus creating an organisation nurturing

performance and innovation.

Reward & Recognition to high performers

Recognize every staff employee being a valuable asset of the organisation, by participating in &

celebrating his/her special moments.
http://www.novartis.com/http://www.sandoz.com/assets/content/en/Sandoz_Virtual_History/index.htmlhttp://www.sandoz.com/site/en/about_sandoz/what_we_stand_for/index.shtmlhttp://www.sandoz.com/site/en/product_range/difficult-to-make/index.shtmlhttp://www.sandoz.com/site/en/product_range/difficult-to-make/index.shtmlhttp://www.sandoz.com/site/en/about_sandoz/what_we_stand_for/index.shtmlhttp://www.sandoz.com/assets/content/en/Sandoz_Virtual_History/index.htmlhttp://www.novartis.com/


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C) Team Award

As and when any cross-functional team working on an assignment exceeds the requirements laid down for

the work or achieves a milestone, the team may be sent out for a dinner or an outing subject to financial

ceiling of Rs.2500/- for each such occasion.

Procedure for Team Award

The contributions shall be highlighted by the team leader to the HR Department on the prescribed format

(Annexure-II) enclosed for the purpose. The HR Department, on receiving the complete form, shall obtain

the approval of the management Committee on the same and process for the award.

D)Annual Award

Objective

The purpose of this award is to recognize the Best Performer of the year. The annual award would have

two categories.

Procedure

1. There would be one award in this category. The nominations would be from amongst thequarterly award winners.

2. HR Head would make the presentation of the nominated persons for the PIIL Annual Award tothe PL forum to discuss the nominations before announcing the final award.

3.This award would consist of a certificate signed by the MD along with a cheque of Rs. 10,000/- ora three-day holiday package to any holiday resort, subject to an expenditure ceiling of Rs.

10,000/-.

4. A copy of the certificate would be placed in the personal file along with an insertion inPIILvani & the name shall be displayed on the notice board.

5. The award would be given on 1stMay every year.


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2. Recognition

Objective

The purpose of recognition is to contribute to the happiness of the employees by participating and celebrating in their

special moments.

Birthday: The employee would be greeted by a Birthday Card & bouquet on the day of his/her birthday by the HOD.

A cake cutting function shall be held on the last birthday of every month.

Wedding: On the occasion of the wedding of the employees or their children, a gift cheque of Rs. 1100/- would

Documents

Reward Main