3PRM Assignment Help Examples and Samples

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Purpose of reward within a performance management system

In order to manage the performance of employees, rewarding is a great influential factor. According to Taba (2018), rewarding employees for their contribution to a business firm, performance and talent causes better effect upon the employees and overall organisational performance. In any business firm the key purpose behind providing rewards to employees is to motivate them, retain talented employees within the organisation and to reduce the costing of turnover (Barth and Beer, 2018). In this regard, it can be stated that Taba (2018), that the reward system has been introduced to the organisation of the environment in order to provide recognition and encouragement to the committed staff for their overwhelming performance. Great performance of employees results in a betterment of overall organisational performance and providing rewards to the efficient employees is helpful for the employees to understand what they are expected to do (Barth and Beer, 2018). According to CIPD (2021), along with being an effective tool for the management of employee performance the reward management system also entails for ensuring the legal rights of the employees related to minimum wage. The feature of rewarding being dependent on the talents and performance efficacy of the employees also helps in mitigating the equality in payment systems according to the UK legislation associated to equity in payment according to UK legislation (2021). Hence it can be said that the reward management is effective in managing employee’s performance by providing them with their legal rights

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Components of an effective total reward system

Total reward system is the amalgamation of benefits, compensation and rewards which is received by an employ yee from their business organisation because of their performance (Beck-Krala, 2020). Mainly there are five key pillars of an effective total reward system that includes compensation, benefits, flexibility, and performance recognition and career development.


Compensation is viewed holistically in the framework of the total reward system and it comprises base salary as well as other compensations that is helpful for motivating an employee for their good performance (Gulyani and Sharma, 2020). A short term incentive pay provides greater compensation to the employees for their short-term performance improvements while long term incentives offer rewards that include stock options, cash bonus and so on.


Benefits that go beyond the legally mandated minimum of society security insurance that includes Medicare, unemployment insurance, worker compensation insurance, and so on can be provided to employees in the total reward system (Beck-Krala, 2020). The aim of providing benefits to the employees is to provide employees with a positive perspective that shows that an employee is considered as a flexible benefits program.


The work environment should promote a healthy balance between work and personal life providing greater flexibility to the employees due to which employees are more likely to perform better.

Performance recognition:

Initiating a system of recognizing employee performances and providing them with awards including peer recognition and team recognition always enhances interpersonal trust between the employer and employee (Gulyani and Sharma, 2018). With the sense of being valued employees tend to perform their best

Career development:

Providing professional development, an organisation not only fosters employee loyalty but also improves their skills within the workforce that results in overall greater productivity of the organisation.

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