(Solution) 7HR03 Strategic Reward Management

7HR03 Strategic Reward Management

  1. Examine the key factors influencing the design of reward strategy and policy frameworks.


From the reviewed literature, it is evident that there are different factors which influence designing of reward strategy and policy frameworks. Adopting the definition of Awaga et al. (2020), a reward strategy is applied in encouraging employees loyalty and behaviours through detailed package of motivating benefits and bonuses. Further, CIPD (2022) argued that this is established by the employers and the people practice departments for the purpose of rewarding employees who achieve particular goals. For the purpose of identifying the impact of the strategic approaches to reward on attracting, motivating and retaining talent Tijani et al. (2022) argued on the need for adopting the PESTEL analysis tool. This is since the reward strategy is impacted by economy, legal, social, political, technological and environment. The authors highlighted that initially, compensation and benefits were significantly simple and straightforward. Nevertheless, owing to the emergence of the identified factors directly influencing the organisations, companies offer strategic rewards which align with culture, values and goals. Further, Agbenyegah (2019) argue on the need for affordability of the offered rewards and their capacity for leveraging on an increased competitive advantage.

Further, in the identified literature, as aforementioned, the reward strategy is significantly impacted by external factors which equally impact on the policy implementation. These factors entail;


In Sese and Oluleye (2018) research, it argued that the aspects including the inflation or deflation influencing or affecting organisation financial and non-financial reward system for employees since the organisation would encounter financial issues when economic crisis is evidently in place. Further, Croner (2022) had argued that issues with unemployment and skills shortages have a direct impact on harnessing the scope of employees reward approach and their facilitation as they are executing their roles.

Further, as evidenced in Dube (2019) while quoting the National Living Wage as an obligatory minimum wage which is payable to employees in UK of age 23 and above. The impact of this is noted by Frontier economics (2022) to has elicited an increased minimum wage which impact on the organisation minimum wages. This is for a successful operations for an organisation success in their organisations and areas of appropriate rewards and operations in the organisation operations. Further, the equal pay legislation Bennedsen et al. (2022) argued the need for embracing the Equality Act 2010 which inform on the need for integrating issues with the gaps existing in their pay strategies.


Further, from the reviewed literature, it is evident that through an embrace of total rewards, the work-life balance need to be integrated. According to Turnea and Prodan (2020) the reward programs would assist the staff in the organisation enjoying quality of life in and out of office. This is an evidence that spend of time on meaningful work in their implementation process and spend of undistracted on meaningful experiences. This is similarly informed by Gartner (2022) survey which had noted the best practice of managing the prevalent skills gap is to ensure that organisations are positioned to appreciate the reward strategy. It is in this regard that the authors recommended o the need for innovative based rewards which prioritise on the employees wellbeing.


In SHRM (2022) research which had focused on evaluating the best practice of use of technologies in the reward strategy adopted, the best practice in the organisations was established. This entailed allowing the management and HR avoiding instinctive decisions which could be cost-intensive to such an organisation. Through the application of survey from different sources of organisations, it was noted that information in compensation management system promptly compare with staff salary to the rest of teams and colleagues.


Word count: 599 words


Agbenyegah, G., 2019. Effect of financial and non-financial rewards on employee motivation in financial institution in Ghana. International Journal of Innovative Research and Development8(8), pp.121-130

Awaga, A.L., Xu, W., Liu, L. and Zhang, Y., 2020. Evolutionary game of green manufacturing mode of enterprises under the influence of government reward and punishment. Advances in Production Engineering & Management15(4), pp.416-430.

Bennedsen, M., Simintzi, E., Tsoutsoura, M. and Wolfenzon, D., 2022. Do firms respond to gender pay gap transparency?. The Journal of Finance77(4), pp.2051-2091.

CIPD 2022. Reward Strategy. Available [Online] https://www.cipd.co.uk/knowledge/strategy/reward [Accessed on 12th December 2022]

Croner 2022. Rethinking rewards; pay and benefits driving results in tough times. Available [Online] https://www.thehrdirector.com/wp-content/uploads/2016/10/Rethinking-rewards-pay-benefits-driving-results-in-tough-times.pdf [Accessed on 12th December 2022]

Dube, A., 2019. Impacts of minimum wages: review of the international evidence. Independent Report. UK Government Publication, pp.268-304.

Frontier economics 2022. Impact of national living wage on businesses. Available [Online] https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/942448/Frontier_-_Impact_of_NLW_on_Businesses_final_8_December_2020.pdf [Accessed on 12th December 2022]

Gartner 2022. Strategies to address skill gaps. Available [Online] https://www.gartner.com/en/human-resources/insights/skills-gap [Accessed on 12th December 2022]

Sese, D.B. and Oluleye, F.A., 2018. Journal of Business School.

SHRM 2022. Today trends and forecasting rewards. Available [Online] https://www.shrm.org/hr-today/trends-and-forecasting/special-reports-and-expert-views/documents/implementing-total-rewards-strategies.pdf [Accessed on 12th December 2022]

Tijani, B., Jin, X.H. and Osei-Kyei, R., 2022. PESTEL analysis of mental health management of project management practitioners (PMPs) in architecture, engineering and construction (AEC) project organization. Smart and Sustainable Built Environment, (ahead-of-print)

Turnea, E.S. and Prodan, A., 2020. The Relative Influence of Total Reward on Retention of Human Resources. Revista de Cercetare si Interventie Sociala69.

1.2 Discuss the importance of aligning the reward framework to the wider organisational context and strategy.

In the available literature, it hypothesise that reward strategies ought to be attracting and retaining the required talents. For instance, Leike et al. (2018) argue that it ought to be viewed by all employees as equitable, competitive and appropriate. Further, Mirković et al. (2019) argued that there is similarly a necessity for ensuring that the rewards programs are motivating the employees in extending their optimum efforts and prioritising on these efforts to meet the organisation objectives. It is in this regard that Han et al. (2019) research introduced on the concept of vertical fit of the reward strategy and organisational strategy. The research found out that a critical factor of organisations where they majorly overlook is aligning the rewards with the business strategy. The findings in the research work hypothesised that rewards could only be effective if they are holistically aligned with organisations short and long-term business objectives and the employees expectations in their job roles. In a different context form the research provided, Ali and Anwar (2021) argued that the employees ought to view the link of their individual work and overall organisation goals. The findings noted the need to identify measurable business goals, driving alignment in the entire organisation levels and equity in target setting. Additionally, being a people practice strategy,………

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