Reward means a thing given to any one because of his contribution to organization. Rewards and incentives contribute to strategy implementation by shaping individual behavior in the organization. A well design reward system is consistent with organizational goals, visions, missions and job performance. The most obvious reward that individual gets from the job is in the form of pay.
In managerial term, reward is defined as the total return given by an employer to an employee for rendering his/her services towards the organizational objectives. This is the overall return from the work. Every person asks for return from the organization before involving in any type of activities,which is termed as the reward. It attracts a worker's attention and inspires him/her to perform the task. Moreover, a reward is a pay-off for performance which is directly concerned with the level of motivation and job satisfaction.
Therefore, management of reward in an organization helps to motivated and retain employees at work. It is a vital aspect of HRM because a well-designed reward system will lead towards organizational productivity and employees satisfaction. Moreover, reward management is the process of creating, implementing and controlling an effective reward system in the organization that helps to maintain and improve organizational performance. It senses the strategic purposes of attracting, motivating and retaining employees. Reward management basically focuses on how the employees can be retained or motivated at work.
Hence, reward management is a crucial aspect of HRM that revolves around designing and implementation of appropriate pay system. This system helps improve organizational performance and get people motivated at work.
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