Synopsis on

“A STUDY ON PROMOTION AND REWARD SYSTEM OF AN

ORGANIZATION”
Submitted in partial fulfilment of the requirement for the
Award of the Degree of
“MASTER OF BUSINESS ADMINISTRATIONS”
BANGALORE CENTRAL UNIVERSITY

Submitted by:
SANTOSH S SULIBHAVI
Reg No: MB182877
Under The Guidance Of
Prof. ANITHA B R

VIVEKANAND INSTITUTE OF MANAGEMENT

Dr. Rajkumar road Rajajinagar Bengaluru 560055
2019-2020
“A STUDY ON PROMOTION AND REWARD SYSTEM OF AN
ORGANIZATION”

INTRODUCTION
Employees are motivated by both intrinsic and extrinsic rewards. To be effective, the reward
system must recognize both sources of motivation. All reward systems are based on the
assumptions of attracting, retaining and motivating people. Financial rewards are an important
component of the reward system, but there are other factors that motivate employees and
influence the level of performance. In fact, several studies have found that among employees
surveyed, money was not the most important motivator, and in some instances managers have
found money to have a demotivating or negative effect on employees.

Today's emphasis on quality-improvement teams and commitment-building programs is creating

a renaissance for financial incentive of pay-for-performance plans. Today financial incentives
constitute less than 5% of the U.S. worker's compensation. Organizations adopt alternative
reward systems to increase domestic and international competition. The competitive reasons for
the growing emphasis on performance-based compensation are companies cutting costs,
restructuring, and boosting performance.

To ensure the reward system is effective and motivates the desired behaviors, it is essential to
consider carefully the rewards and strategies utilized and ensure the rewards are linked to or
based on performance. To be effective, any performance measurement system must be tied to
compensation or some sort of reward. Rewarding performance should be an ongoing managerial
activity, not just an annual pay-linked ritual.

Strategies for rewarding employees’ performance and contributions include both non-
financial and financial mechanisms. Some of the primary ones are discussed below. The list is
not exhaustive, and individual units/departments may identify additional mechanisms that are
appropriate for and support their culture and goals.

Praise/recognition from supervisors - 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.

Paid Leave -Supervisors may award employees up to 32 hours of paid leave annually in

recognition of meritorious performance.

 Progression through the salary range -Employees may receive salary increases to recognize

the attainment of new and/or the enhancement of existing skills/competencies or for assuming
increased responsibilities within the scope of the current position. The salary increase represents
a progression through the salary range approved for the  position

 Merit increases - UT-Houston policy allows supervisors to give employees an annual merit

increase to recognize consistently meritorious performance or successful completion of a project
that had a significant impact on a department or the university. The reward may be in any
amount up to 5% of the employee's current base salary, subject to the availability of funds.

REVIEW OF LITERATURE
PROMOTION
Organizations in today‘s environment seek to determine the reasonable balance between
employee commitment and performance of the organization. The reward and promotion
programs serve as the most contingent factor in keeping employees self esteem high and
passionate. Osthuizen (2001) stated that it is among the function of managers to motivate the
employees successfully and influence their behavior to achieve greater organizational efficiency.
La Motta (1995) is of the view that performance at job is the result of ability and motivation.
Ability formulated through education, equipment, training, experience, ease in task and two
types of capacities i.e. mental and physical. The performance evaluation and rewards are the
factors that proved to be the bonding agents of the performance evaluation programs. According
to Wilson (1994), the process of performance management is one among the key elements of
total reward system.
Entwistle (1987) is of the view that if an employee performs successfully, it leads to
organizational rewards and as a result motivational factor of employees lies in their performance.
Majority of the organizations require their employees to work according to the rules and
regulations, as well as, job requirements that comply with full standards. The investigations that
have been conducted to find the relationship between compensation and individuals were
focused to increase the performance of employees (Ciscel, 1974). The highly motivated
employees serve as the competitive advantage for any company because their performance leads
an organization to well accomplishment of its goals. Among financial, economical and human
resources, human resources are more vital that can provide a company competitive edge as
compared to others.

REWARD POLICY
According to Andrew (2004), commitment of all employees is based on rewards and promotion.
Lawler (2003) argued that prosperity and survival of the organizations is determined through the
human resources how they are treated. Most of organizations have gained the immense progress
by fully complying with their business strategy through a well balanced reward and promotion
programs for employee.
Deeprose (1994) argued that the motivation of employees and their productivity can be
enhanced through providing them effective promotion which ultimately results in improved
performance 21 of organizations. The entire success of an organization is based on how an
organization keeps its employees motivated and in what way they evaluate the performance of
employees for job compensation. Managing the performance of employees forms an integral part
of any organizational strategy and how they deal with their human capital (Drucker as cited in
Meyer & Kirsten, 2005).
Today where every organization has to meet its obligations; the performance of employees has a
very crucial impact on overall organizational achievement. In a demotivated environment, low or
courage less employees can not practice their skills, abilities, innovation and full commitment to
the extent an organization needs. Freedman (1978) is of the view that when effective rewards and
promotion are implemented within an organization, favourable working environment is produced
which motivates employees to excel in their performance. Employees take promotion as their
feelings of value and appreciation and as a result it boosts up morale of employee which
ultimately increases productivity of organizations. C sikszentmihalyi (1990) posits a view that
the state of satisfaction and happiness is achieved by the employees only when they maximally
put their abilities in performing the activities and functions at work.
The rewards include the financial rewards, pay and benefits, promotions and incentives that
satisfy employees to some extent but for committed employees, recognition must be given to
keep them motivated, appreciated and committed. Baron (1983) argued that when we recognize
and acknowledge the employees in terms of their identification, their working capacity and
performance is very high. Recognition today is highest need according to most of the experts
whereas a reward which includes all the monetary and compensative benefits cannot be the sole
motivator for employees‘ motivation program. Employees are motivated fully when their needs
are met. The level of motivation of employees increases when employees get an unexpected
increase in promotion, praise and pay (La Motta, 1995). In today‘s dynamic environment the
highly motivated employees serve as a synergy for accomplishment of company‘s goals,
business plans, high efficiency, growth and performance. Motivation is also required when the
organizational workforce has not a good relationship pattern.
Employees‘ relation with employees and with supervisor is a key ingredient of the inner strength
of the organization. The ability of supervisors to provide strong leadership has an effect on job
satisfaction of employees (Morris, 2004). The study relates how the impact of incentives,
promotion and rewards programs drives employee motivation.
Steve Williams and Fred Luthans (1992) stated that, "the choice of reward interacting with
feed back had a positive impact on task performance".
Simon (1992) after thorough study suggested that employees should be given cash bonuses and
prizes for meeting sales targets, customer services and cleanest store. For special yearly
competition when only few people gain prizes should be precious and can range from holiday
voucher, a set of 2 tickets for an all expense paid trip to Hollywood

STATEMENT OF THE PROBLEM

An attitude has a potential to make employees behave in a positive or negative way. If the
employees attitude negatively affected by any of their organisations internal business process,
she/he will develop a negative attitudes concerning their work and express this behaviours
through overgeneralization and labelling, personalization and blame, jumping to conclusions and
the negative side of every aspects of their work environment which in turn directly affects the
performance of employees.
The statement of the problem is:
 
 How to determine the association between rewards and employee retention?

 How can we assess the influence of job satisfaction on employees’

 Intention to stay with the organization?

 What is the association between human resource policies and employee retention?
OBJECTIVES OF THE STUDY
The objective of the study is
 
 Determine the association between rewards and employee retention.
 
 Assess the influence of job satisfaction on employees intension to stay with the
organization.

 Investigate the association between human resource policies and employee retention.

 To identify aspects of work interfaces with personal life.

HYPOTHESIS
There are three main hypotheses to be tested in order to gain adequate understanding of the
research.

 There exists a significant relationship between intrinsic rewards and

workers performance.

 There is a significant relationship between employees and employers.

 There is a significant relationship between emotional intelligence and work life of

employees.
RESEARCH METHODOLOGY
The study was based on survey method. The aim of the study is to find out the performance
and motivational level of employees through promotion and reward policy system.

TYPE OF STUDY
The above mentioned respondent topic is qualitative and quantitative in nature. The survey has
been conducted among the 20 to 30 respondents using questionnaires which helps in gathering
the data. The descriptive research design is used to conduct and analyze the research and
development.

Method of data collection

Sources of data: the data is the fact of an event. The data is mainly classified into two groups,
there are as fallows.
Primary data: primary data was collected through personal interview by using questionnaires,
and also through observation.
Secondary data; secondary data has been collected through following sources.
 Books
 Journals
 Articles
 Magazines
 Websites
 Published and unpublished records

Method of sampling
Sampling technique
Convenience sampling technique is used in this research.
Sample size
The sample size of this study is 50 to 60 respondents

DATA ANALYSIS PROPOSED

The data analysis made by the survey has been conducted by using questionnaires method among
50 employees in the organization. The opinion has been derived. In order to give best outcome
and result through the research study the various statistical tools and techniques has been used to
find out the result.
LIMITATIONS OF THE STUDY
 The period of study was too short. So it was not possible to collect the relevant
information within the period
 The information provided by respondents may not be fully accurate due to unavoidable
biases.
 The technique for collecting the data is convenience sampling due to monitory and
manpower constraints.
 The research was carried out in a span of time, where in the research could not widen the
study.

CONCLUSION
The concern of this study relates with, promotion and reward policy system implemented by the
firm will focus on opening up decision making processes to enable employees to develop their
professional skills in the long term. As a result, this will allow employees to contribute to the
long term success of the organisation by proposing valuable ideas which will improve the quality
of results attained. Appraisal system which the organisation will use will enable it to be fair to all
its employees to encourage them to attain good results in their respective workstations.
This study confirms both promotion and reward policy system among employees together create
organizational success and develop competitive advantage for an organization. The study can be
carried out on large sample size. It can also be done across industries and across different time
period. After a detailed study within the industry it can be compared with other industries.

STUDENT SIGNATURE GUIDE SIGNATURE

(SANTOSH S SULIBHAVI) ( Prof. ANITHA. B R)