Reflective Essay: Using one organization with which you are familiar as an example, describe how existing compensation affects organizational culture. After describing the compensation and reward system of the company (or part of the company) you chose, analyze whether the system acts to the advantage or disadvantage of organizational strategy. Please feel free to include additional types of compensation and reward that help explain and enrich your response. Your assessment should also include a section detailing where you obtained the information sources, as well as the methodology used to perform any analysis. This project should follow a structured approach and should be prepared and presented as a professional essay approximately 2,000 words long. Third person applied. Please be sure that the final submission adheres to APA formatting standards.
Compensation refers to the system of providing both monetary and non-monetary value to the employees in exchange for their services. The employees who develop their abilities to levels of achieving or exceeding their job requirement are compensated. Compensation helps in increasing the workers motivation and drive them to work harder for better performance of the organization. It can also assist in the recruitment and job satisfaction purposes. Various groups use it as a tool for maintaining their existence (West et al, 2002).
Compensation has very many advantages to the organizations and is used to employ and retain highly qualified applicants. It is difficult for employers to hire the workers with high skills due to their high demands by the competitors. The workers tend to go for the organization that rewards them the best (Cooper & Cartwright, 1994). As a result, employees use the various methods of compensation to ensure they do not lose such workers. Also, compensation is used increase and maintain the workers’ morale in their jobs. For instance, the employer can raise the workers’ salaries or wages to reduce the rates of turnover. Compensation acts as a reward particularly for exceptional work performance in terms of bonuses, gain sharing, and commissions. It also facilitates achieving the internal and external equity of the organization. The organization’s loyalty is encouraged when the workers get high compensation.
For the organizations to establish and maintain an equitable reward system, they need to have a good compensation management. It involves developing an equitable wage and salary structure, equitable cost structure. A survey must be carried out to determine the needs of the employees. Workers do what they do to satisfy some needs, and before they do it, they will always ask themselves what reward they will get at the end. Analyzing and interpreting workers’ needs help the employees in establishing a long-term compensation structure (Edwards & Peccei, 2015). An efficient compensation must adhere to the following principles. The requirements of the job determine the amount of reward to Van De Voorde, K., Paauwe, J., & Van Veldhoven, M. (2012). The level of wages and salaries for the organization should be in line with those existing in the job market…..