Reward, Recognition, and Performance Business Brief

Introduction

Reward, recognition, and performance management involve measuring employee performance and recognizing the high-performing employees with rewards. Organizations seeking to attain their goals must implement a performance measurement system, recognition, and rewards. Measuring individual employee performance is essential in tracking their progress and productivity to identify their strengths and weaknesses. The performance management system informs managers’ decision-making by terminating poorly performing employees and promoting highly performing ones. Therefore, a performance measurement and reward system tells the management to draw conclusions and assess how the entire organization competes with its rivals. Additionally, it serves to lay a foundation for employee motivation. My recommendations for such a system should be needs-based, allow goal setting, encompass instant feedback, and have a performance-based reward system.

Current Methods

The current methods used in the ABC healthcare organization involve quantitative, efficiency, qualitative, and organizational metrics. Quantitative metrics use numerical data to evaluate an employee’s performance, resulting in data-driven decisions (Wylie & Newton, 2018). Quantitative metrics used to measure employee performance include resources and time used to complete a process or a task. Resource-based assessment closely relates to measuring the efficiency of an employee because a high-performing and efficient employee uses less resources and less time to complete a task compared to employees with low efficiency. Therefore, highly productive and efficient employees use fewer resources and thus cause minimal costs to the organization. The other quantitative metric is the financial return of an employee. For example, the company uses return on investment, which measures the profit an employee brings to the organization after spending. It also focuses on cash flow, which assesses the amount of money coming in and going out.

The healthcare organization also uses qualitative metrics such as customer satisfaction and retention to measure an employee’s performance. Customer satisfaction measures how happy the clients are with an employee’s service. In contrast, client retention measures the number of customers who return to the organization for a product or a service and continue their subscription (Wylie & Newton, 2018). The number of customers who make repeat visits to the organization helps evaluate the customers’ satisfaction and, thus, retention. Sources of information for qualitative metrics include peer and customer feedback that can be collected through surveys, polls, and company reviews.

Organizational metrics include assessing an employee’s flexibility, effectiveness, and safety. Flexibility is measured by collecting feedback from supervisors and peers to evaluate how flexible an employee is by assessing the extent to which an employee is willing and enthusiastic to help when needed and to complete tasks that need spontaneous actions (Taouab & Issor, 2019). An employee’s effectiveness is measured by assessing how the individual enhances safety. Information for this assessment is the number of accidents an employee causes. The fewer accidents, the more effective an employee is.

Effectiveness of the Methods

The current methods of measuring employee performance are effective because they provide valuable insights into how the organization performs and competes with its competitors. The effectiveness of the methods is measured by assessing how they inform critical management and organization decisions and thus positively impact the business (Metz et al., 2018). The performance measurement result using the current quantitative, qualitative, and organizational metrics has been essential for management’s wise decisions. These decisions include making the right marketing strategies and introducing new features to products and services (Shet et al., 2019). Performance measurement using these methods has enabled management to understand the role of customer engagement and retention in taking the business in the right direction and putting the organization in a competitive advantage over its rivals. Knowing an organization’s stand in the competitive industry is crucial to provide a clear picture of the organization’s performance and identify areas of improvement and innovation.

Additionally, the effectiveness of these methods is also measured through how they enhance the capacity to unlock revenue drivers. This results from understanding what drives the organization. Knowing revenue drivers helps the company optimize the identified revenue drivers, thus unclicking the business’s full potential.

Key Results

The key results of the qualitative and quantitative metrics are high product and service adoption rates, enhanced client satisfaction, and thus high customer retention rates. Other results are high-profit margins and increasing monthly recurring revenue. Additionally, the company aims to reduce costs, accidents, and absence rates and improve and enhance employee motivation. Therefore, all the key results are geared towards boosting employee morale, development, and high productivity. High employee productivity translates to enhanced financial performance of the organization and thus its competitive edge over its rivals. The following table shows an employee’s performance using key indicators (KPI).

Performance Measurement Metrics

Recommendations

The employee performance measurement system should include goal setting and timely feedback. Goal setting will enable the employees to align their efforts to the organizational goals. Goals will provide a roadmap and framework for employees to pursue positive outcomes and enhance productivity. The primary purpose of setting goals in performance measurement is to boost the employees’ morale to comply with the industry standards of behaviors and practices to produce the results desired by the organization (López-Cabarcos et al., 2022). Goal setting causes employee motivation because meeting set goals provides a sense of fulfillment. This sense of fulfillment makes the employees’ work seem more meaningful and thus promotes their job satisfaction and retention rates.

Moreover, feedback is critical in helping employees identify and focus on their strengths. Also, it allows the identification of weaknesses and working towards improving these areas. This motivates employees to perform better and align their efforts to attain goals.

The recognition and reward system should be performance-based. A performance-based recognition and reward system allows the management to recognize and reward employees based on their performance. This makes the workforce work harder to attain their goals for recognition and rewards. Moreover, the rewards system should be transparent so that every employee can predict who qualifies for recognition and rewards.

Conclusion

Employee performance measurement should revolve around assessing workers’ performance and productivity. This is measured by assessing their progress towards attaining their set goals. Methods used to measure employee performance include qualitative, quantitative, and organizational metrics. The measurement should encompass goal setting and feedback to enhance employee motivation. Moreover, highly performing employees should be recognized and rewarded.

References

López-Cabarcos, M. Á., Vázquez-Rodríguez, P., & QuinoA-Pineiro, L. M. (2022). An approach to employees’ job performance through work environmental variables and leadership behaviors. Journal of Business Research, 140, 361-369. https://doi.org/10.1016/j.jbusres.2021.11.006

Metz, D., Ilies, L., & Hörmann, B. O. (2018). The impact of human resources management system effectiveness on performance. Annals of Faculty of Economics, University of Oradea, 1(1), 471-478. https://www.researchgate.net/profile/Daniela-Cialfi/publication/333419923_Social_capital_formation_Do_ICT_matter_for_Europe/links/5cecdac5299bf109da7513f8/Social-capital-formation-Do-ICT-matter-for-Europe.pdf#page=471

Shet, S. V., Patil, S. V., & Chandawarkar, M. R. (2019). Competency-based superior performance and organizational effectiveness. International Journal of Productivity and Performance Management, 68(4), 753-773. https://doi.org/10.1108/IJPPM-03-2018-0128

Taouab, O., & Issor, Z. (2019). Firm performance: Definition and measurement models. European Scientific Journal, 15(1), 93-106. http://dx.doi.org/10.19044/esj.2019.v15n1p93

Wylie, C. E., & Newton, J. R. (2018). A systematic literature search to identify performance measure outcomes used in clinical studies of racehorses. Equine Veterinary Journal, 50(3), 304–311. https://doi.org/10.1111/evj.12757