Introduction to Human Resource Management

TextBook: Byars, L. and Rue, L TextBook: Byars, L. and Rue, L., “Human Resource Management”, 9th , McGraw Hill, (2008).

Chapter 12- Learning Objectives Compensating Human Resource Define organisational rewards Distinguish between intrinsic and extrinsic rewards List several desirable preconditions for implementing a pay for performance program Define job satisfaction and list its five major components.

Define organisational rewards It includes all types of rewards, both intrinsic and extrinsic that are received as a result of employment by the organisation

Difference between Intrinsic and extrinsic rewards Intrinsic rewards are rewards internal to the employee and are normally derived from involvement in certain activities or tasks. Extrinsic rewards are directly controlled and distributed by the organisation and are more tangible than intrinsic rewards.

Job Satisfaction and its major components Job satisfaction is and employees general attitude toward the job. The five major components of job satisfaction are: Attitude towards the work group General working conditions. Attitude toward the company Monetary benefits and Attitude toward supervision.

Define- Compensation,pay , incentives and benefits. Compensation refers to all the extrinsic rewards employees receive in exchange for their work. Pay includes only the actual dollars employees receive in exchange for their work. Incentives are rewards offered in addition to the base wage or salary and are directly related to performance. Benefits are rewards employees receive as a result of their employment and position with an organisation.

Define- Equity theory of motivation The theory holds that employees have a strong need to maintain a balance between what they perceive as their inputs to their jobs and what they receive from their jobs in the form of rewards. In this theory, employees who perceive inequities will take action to eliminate or reduce the inequities.

Define- Equity theory of motivation Internal equity concerns what an employee is being paid for doing a given job compared to what other employees in the same organisation are being paid to do their jobs. External equity deals with what employees in other organisations are being paid for performing similar jobs.

Define- Equity theory of motivation Individual equity addresses rewarding individual contributions and is very closely related to the pay for performance question. Organisational equity concerns how profits are divided up within the organisation.

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