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Reward Management (Rmt)

1. Introduction - Reward Management (Rmt)

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In the modern era of business, employee recognition and reward has become a strategic way to improve the business values and deriving of competitive advantages in the path of business operation. As employees are the backbone of business growth, thereby business organizations are gradually taking into consideration the approach of reward management in their business. The approach of reward management is on-demand with the rise of market competition and changing scenario of business over the past decades. The present report emphasizes the context of reward management in the present-day business with a special reference to Baker’s Department Store of the UK. Current practices of reward management and policies of Baker’s Department Store are going to be evaluated in this aspect. The report further aims to suggest a new approach to managing reward and pay for the selected organization after reviewing the scenario.

2. Strategic analysis

2.1 Analysis of External factors

Political factors

? Powerful country with parliamentary democracy

? Maintain good relations with neighboring countries such as US, Canada and others

? Political debates due to BREXIT movement (Bikakis, 2020)

Economical factors

? 6th largest economy with nominal GDP

? The “GDP rate of the UK is 30705.28 USD in 2021” (Tradingeconomics, 2021).

? The “corporate tax rate in the UK is 19% in 2021” (Gov. uk, 2022).

? FDI inflow in the UK increased by “£288.7 billion in 2020” (Ons, 2021)

Social factors

? High standard of living

? The “population of the UK is 67.1 million in 2020” (Ons, 2021)

? Literacy rate in the UK is “96% in 2020”

Technological factors

? Most advanced country technologically

? The rate of “technological turn over” within UK is around 184bn in 2018” (Information, 2020).

Environmental factors

? Impact of climate change

? Unpredictable country’s season

Legal factors

? Effective regulation of procurement

? “Employment equity act, 2010” (UK.gov, 2021)

Table 1: PESTLE analysis

(Source: Created by the learner)


The country possesses parliamentary democracy along with having a fair as well as stable political infrastructure. Due to having potential foreign policies, the country can able to maintain good relationships with its neighboring ones which indicate that Baker’s Department Store derives benefits from business collaboration. On the other hand, as per the GDP rate, it can be stated that having the business operation in a growing economy the company also benefit from immense opportunities in business that help to meet their strategic objectives. Further, the company also gains various taxable profits in their business with the benefit of the standard rate of corporate tax in the country.

Due to the presence of potential federal claws, it can be stated that Baker’s Department Store also benefits from the avoidance of various kinds of ethical constrain that in turn ensure the smooth operation of their business in this country. In addition, as the country is technologically advanced one thereby the organization also benefits from developed infrastructure in their business. It has been seen that due to the unpredictable climate the operation of Baker’s Department Store is also affected sometimes in the UK market. Thereby, it can be stated that the external environment in which the company currently operates is suitable in terms of upholding a sustainable approach to providing employees remuneration and ensuring a fair standard of ethical practices within the organizational culture.

2.2 Analysis of Internal factors



? Wide presence along with the number of stores across the country (Barkers, 2020).

? Trained employees presence

? Presence of variety of products range

? Highly visible websites

? In house production with close supervision


? Changing trends in fashion industry

? High transportation costs

? Limited flexibility in pricing


? Continued expansion for online sales

? Acquisition of other companies

? Increasing consumer spending on fashion products

? Improvement of brand awareness by proper marketing (Bikakis, 2020)


? Increasing competition

? Price pressure from the peer merchants

? Changing economic condition in local market

Table 2: SWOT analysis

(Source: Created by the learner)


Baker’s Department Store is one of the reputed departmental merchandise in the market of UK that offers an incredible range of products to the consumers. Due to having highly trained workers, the organization enable to offer its consumers personalized shopping every season which enhances its market growth as well. Both offline and online services along with websites help to enhance their consumer's experience that in turn contributes to the branding. Apart from that, the high costs of transportation after the pandemic impact affected the business operation of the company thereby limited flexibility is seen in their product pricing. The lack of flexibility in pricing reduces the consumer's engagement respectively.

Further, as today's consumers prefer to spend on fashion products thereby the organization can grab the opportunity of expanding its business by focusing on its marketing strategy. The adoption of a potential strategy also would help to trigger their brand awareness in their existing marketplace. On the other hand, it can be also added that the rising competition in the market act as a threat to the Baker’s Department Store’s business that in turn affects the various operational practices and reduces the quality of their products. The offering of low product quality can affect the market reputation of the chosen organization. However, after evaluating the internal scenario it can be stated that in order to stay competitive in now and the near future, the organization should give more focus on their employee's motivation as it is pivotal to covering the operational ineffectiveness.

3. Reward intelligence

3.1 Different types of reward intelligence

Various forms of reward intelligence have seen to be used in the modern business for the purpose of deriving benefits from strategic compensation decisions. From the perspective of motivating employees, the performance-related pay is one of the generic used ones which include rewards the workers for the rationale of their hard work and contribution towards the organization's goals. This approach to intelligence help to foster inherent fairness in the organizational culture and in turn fosters the employee's productivity. As opined by Amaeshi (2019), in the area of group performance that intelligence is less effective in comparison to other forms. The other reward intelligence includes knowledge contingent pay that focuses on providing rewards on the basis of knowledge level exams to the employees.

The commission is the other form of reward intelligence that indicates the provision of compensation above basic pay in order to motivate the sales workers. By providing the high commission the business organization can able to achieve increment in their economy of sales through employees motivation. Some disadvantages are also there in this form such as dysfunctional behavior within the organizational culture. Profit related pay is used in group performance in order to remunerate employees on the basis of organizational profits, that in turn helps to boost the workforce performance as well (Anku et al. 2018). Moreover, it can be stated that based on their workplace scenario, Baker’s Department Store can use the above-mentioned forms of various reward intelligence that in turn help the organization to enhance its employee commitment and also facilitate business revenue.

3.2 Different ways of presenting reward intelligence

In various ways the HR personnel of the business firms are generally gathered reward intelligence as well as represent that in operation as well. Traditional ways of gathering reward intelligence include salary surveys, local surveys, and the publishing of the annual list of rewards. It has been seen that salary surveys help to provide qualitative as well as quantitative data that help to do comparisons and document the complementary sources for HR (BRUTU, 2019). The accuracy of the survey helps the organization meet specific needs related to workers.

A local survey of the labor market also is helpful to leverage the data of reward intelligence and its proper presentation in the organizational process of decision making. The publishing of the annual compensation chart also acts as a strategic approach in terms of collecting the reward intelligence (Bwowe and Marongwe, 2018). Gathering insights in terms of intelligence of reward help to make the compensation decision more robust in terms of triggering effective reward and pay. Baker’s Department Store can use all of these approaches in their business operation for the purpose of being more strategic in the area of reward and pay.

3.3 Use of reward intelligence in making decisions about reward

Salary survey, as considered an appropriate way of reward intelligence can be used in the area of building a competitive pay structure for the Baker’s Department Store as it is helpful to identify the gaps in the salary structure. The method is helpful in ensuring the fact that organizational reward plans are internally equitable or not, that in turn broadens the operational efficacy (Emuron, 2020). On the other hand, with the help of such an approach of reward intelligence, the selected company can able to retain its worker's commitment that in turn reflects their decision's effectiveness. Apart from that, the use of this approach also makes the process of reward decision making more convenient in terms of building employees' morale as well. Another benefit of the use of a salary survey in the path of making decisions is to ensure of right data as per requirement and also offer it in a fairway. 

4. Total reward

Baker’s Department Store is focused on moving forward its operation by taking more strategic views in the area of reward and pay. The aligning of the reward principle in the area of decisions and other operational areas in this aspect can help the Baker’s Department Store in gaining a cutting edge in operational investment and also in achieving a great balance between the employee's needs and organizational needs. The principle focused on the development of a benefits system in order to review the strategy as well as growth (Cipd, 2021). Alignment of the preference of the workforce in the reward decisions is another principle that may help the selected organization in the building of their employee morale. It can be stated that reward principles are effective in terms of shaping Baker’s Department Store’s reward strategy and helps to fulfill the benefits and goals of employees in a wider way.

Figure 1: A total reward strategy

(Source: Norma, 2018)

A total reward strategy is basically a coordinated organizational effort in order to boost the employee’s motivation toward growth and excellence through an inclusive package of rewards. The use of Maslow’s approach can help the chosen firms in terms of fulfilling their top priorities including attracting new talents, competitiveness, reduction of the ratio of employee’s retention and employee’s satisfaction respectively. The strategy states that the fulfillment of five categories of the need of human as indicated in the above figure help to dictate the essence of motivation for individuals. Implementation should also consider the effective alienation of all its components such as development, compensation, wellbeing’s and others with the reward strategy (Lakshmi, 2018). By implementing an effective approach of total reward, Baker’s Department Store can able to witness immense business progress and able to offer quality services or products in their existing marketplace.

5. Equity and fairness of reward policies and practices

In the way of rewarding, it has been seen that consistency, equity, fairness and transparency play an effective role by founding pillars of reward policy and practices. The presence of a fair and equitable approach in the context of reward management not only helps to hinder employees' motivation through fair representation but also endorses the building of organizational behaviors respectively (Martono et al. 2018). All of the components reinforce the organizational values and foster integrity among employees. The practice of reward in ethical way downsides the threats of employee de-motivation and also ensure good practices within the organizational culture. Thereby Baker’s Department Store can put this practical means of integrity in their way of rewarding to be more strategic.

6. Line managers and their contribution to reward

Managers are considered a focal point when it comes to effectively managing the performance of the employees as well as organizations. Various roles are performed by the line managers in the way of reward management including encouraging the employees, fostering communication in the decision-making process, taking the lead in setting goals and others (Nigusie and Getachew, 2019). It has been seen that in order to bring the plan into action, the HR managers are working with the line managers for the provision of support. For example, in an organizational reward program, line managers are guided by the HR department for making the giving of intangible rewards more accurate (Okeke et al. 2020). Additionally, in order to identify as well as mitigate various risks such as financial, implementation faults and other behavioural ones, HR helps the line managers in the establishment of a best practice approach. Thereby HR of Baker’s Department Store needs to vest their interest in working collaboratively with line managers in order to fulfill their strategic target of reward management.

7. Organizational performance and the link to reward

Both intrinsic and extrinsic rewards are beneficial for improving the worker's contribution as well as sustaining the company’s performance. Extrinsic rewards include tangible rewards such as bonuses, pay raises and others that are financially concerned whereas, intrinsic rewards include psychological fulfillment that helps to foster greater performance (Okoli et al. 2020). It has been seen that the giving of employees more autonomy and healthy working hours help Tesco to empower the employees and at the same time make the strategy purpose-driven. Recognition of the worker's performance through awarding helps to increase the employees' morale and motivation. Besides, allowing the employees in the process of decision making, putting their own ideas and others help to generate a positive emotional reaction respectively that is effective in motivating the employees to give their best. Baker’s Department Store can incorporate both ways after accessing scenarios for providing potential motivation to their employees respectively. 

8. Recommendations

Based on the above discussion it can be stated that Baker’s Department Store needs to give focus on making their practice of reward management more robust in order to stay more competitive in their business operation. The manager of Baker’s Department Store can follow the above-mentioned ways as follows:

  • It is recommended to the manager of Baker’s Department Store to prioritize the incorporation of a reward management system in order to access the performance of their employees. It also may help to take accurate decisions to meet the employee's needs (Sara and Umma, 2019)
  • Another recommendation includes the engagement of employees in the path of designing the reward strategy that may help Baker’s Department Store in fostering effective management of rewards. That, in turn, helps the company to build a good reputation with the help of enhanced employees' productivity.

9. Conclusion

On the whole it can be stated that from the above discussion, the strategic approach of reward management can help Baker’s Department Store in terms of gaining consumer satisfaction and market growth in business. It can also be added that with the help of reward management the business firm is not only able to foster their commitment to employees but also ensure the employees well beings with the provision of cultural support. Furthermore, the use of a total reward approach as the form of Maslow's model can prove beneficial for Baker’s Department Store in their way of moving forward their business competency through managing reward and pay effectively.

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