Types of Rewards vs Employee Engagement

 Unlocking Employee Engagement Through Strategic Rewards: Modern HRM Insights

1.  Types of Rewards vs Employee Engagement

When we talk about strategic rewards in HRM, one must understand that not all rewards are equal in their own standing. Nevertheless, broadly speaking, rewards can be classified into two types: Monetary and Non-monetary. These two types each serve distinct and meaningful functions in motivating employees and creating engagement.

Monetary Rewards

Let’s face it; anyone expects to get paid for work. But monetary rewards go far beyond just that. Bonuses, profit sharing, commissions, stock options, and other monetary incentives show employees that the company acknowledges and values their effort. These rewards are much more direct, measurable, and results-oriented than some other ways of appreciating and rewarding their staff. They speak a clear language: "We see what you're doing, and we appreciate it."

To take another case, Salesforce has devised a reward system that not only pays well but also motivates. Employees earn bonuses and grants of equity linked to their performance with the growing value when the Company does well. The employees get to feel possessive, while the Company gains from their commitment.

Nonetheless, money isn’t everything. As indicated by recent research carried out by the Harvard Business Review, these financial rewards can be useful in attaining short-range aims but can’t be relied on to keep people engaged in the long term, especially in jobs requiring creativity or deep thinking. Here, an overemphasis on money can even become counterproductive, distracting an intelligent worker from doing meaningful work.

So sure, money does matter, but it is only a part of the entire when it comes to keeping people truly motivated and engaged.

Non-Monetary Rewards 

While money is more important, what truly drives employee to stay, grow, and do their best work often come down to something far deeper how they feel. And that is the place of non-monetary rewards. These moments and gestures are ones that demonstrate to employees that they are genuinely valued not only as workers but as human beings.

Something as simply said "thank you" during a meeting, public acknowledgement for a job "well done good job" or even a handwritten note from a higher officials. Such recognition may not cost a time, but it will goes miles in employees to feel seen and appreciated. Opportunity for growth and development fits here as well. When employers offer training, mentoring, or stretch assignments that help employees to build their skills, they're increasing a level of trust and investment in the future of those employees. That encouragement is worth more than anything. 

Support for wellness and work life balance is another form of a non-financial reward, which is a top priority for many organizations today. As reported by Microsoft 2022, Microsoft offers flexible work schedules, wellness programs, mental health resources and programs like Mental Health Days and Microsoft Viva to support employee wellness in hybrid work models.

When an organization truly supports its employees in these ways, beyond paying their salaries employees are more likely to be emotionally engaged in their jobs. In fact, two research studies, Gallup  and Deloitte found that non-monetary recognition and personal growth opportunities are key drivers of long-term levels of engagement and retention.

Conclusion

Most rewarding systems strike the sweet spot between monetary reward and interpersonal appreciation. A good salary and bonuses will most certainly matter, they show your team that their hard work is appreciated in a tangible manner. But when you combine that with genuine recognition and real opportunities for growth, that’s when the magic happens. That’s when people feel truly valued.

An example would be Cisco, which offers gainful pay and stock options along with fostering an appreciation culture. Via the “Connected Recognition” platform, employees can send praises to each other for actions that reinforce the company’s values. Quite a good case demonstrating how financial rewards with personal recognition may join hands to converge upon making employees feel appreciated, supported, and, therefore, truly motivated.

References

·       Gallup. (2023). State of the Global Workplace: 2023 Report.
Retrieved from: https://www.gallup.com/workplace/349484/state-of-the-global-workplace.aspx

·       Deloitte. (2023). 2023 Global Human Capital Trends: The social enterprise and the reinvention of rewards.
Retrieved from: https://www2.deloitte.com/global/en/pages/human-capital/articles/introduction-human-capital-trends.html

·       Harvard Business Review. (2022). What Great Managers Do to Engage Employees.
Retrieved from: https://hbr.org/2015/03/what-great-managers-do-to-engage-employees

·       WorldatWork. (2021). The Role of Rewards in Employee Engagement.
Retrieved from: https://www.worldatwork.org/\

·       Microsoft. (2022). Hybrid Work and Wellbeing Report.
Retrieved from: https://blogs.microsoft.com/

·       Google / Schmidt, E., & Rosenberg, J. (2014). How Google Works. Grand Central Publishing.

·        Hsieh, T. (2010). Delivering Happiness: A Path to Profits, Passion, and Purpose. Business Plus.

·       Salesforce. (2023). Working at Salesforce: Compensation and Benefits Overview.
Retrieved from: https://www.salesforce.com/company/careers/

·       Cisco. (2021). Connected Recognition Program at Cisco.
Retrieved from: https://www.cisco.com/