Human resource management practice I also available by michael armstrong

Chapter 

26

  Reward Management – Strategy and Systems

361

Formulating reward strategy

The research conducted by Trevor (2011) in seven 

companies  established  that  in  all  cases  senior 

management decided on the strategy. They:

 

●

agreed guiding principles;

 

●

provided broad guidelines in the form  

of expected outcomes;

 

●

reviewed options for action;

 

●

settled the course of action.

This was the basis for the design stage, which was 

determined  largely  by  benchmarking  best  practice 

and internal concerns over relativity, equity (fairness), 

governance and performance.

A well-designed reward strategy should be based 

on the answers to the following questions:

 

●

How will it add value?

 

●

How is it going to be put into effect?

 

●

What supporting processes will be needed 

and can they be made available?

 

●

Who is going to be involved in 

implementation?

 

●

How are we going to make sure that those 

involved know what they have to do, know 

why they are expected to do it, believe that it 

is worthwhile and have the skills to do it?

 

●

Are people likely to react negatively to the 

proposed strategy and, if so, how do we deal 

with their concerns?

 

●

How much time will be needed; how much 

time have we got?

 

●

Will any additional resources be required 

and can they be made available?

 

●

Are there any likely implementation 

problems and how will they be dealt with?

Particular attention should be paid to issues arising 

from process factors (how the strategy will work) 

involving  people  and  communicating  with  them, 

and the part played by line managers.