PERFORMANCE &

REWARD
EVOLUTION LTD

Group Assignment

By:

MAUDARBUCCUS Anisha : 160860

YEUNG CHING SING Sandrine : 160872
RAMKURRUN Nomesh : 160866
UJOODHA Yashveer : 160870

MBA-Project Management
MBAPM/16B/PT

08 May, 2017
Table of Contents
1. Introduction ............................................................................................................................................. 2
2. Case Study .............................................................................................................................................. 3
3. Performance Management System ................................................................................................... 4
4. Relation between motivation and performance management ................................................... 4
5. Performance Analysis .......................................................................................................................... 6
6. Reward Management ............................................................................................................................ 7
6.1 Reward System Analysis ................................................................................................................. 8
6.2 The relationship between performance management and reward ....................................... 9
7. Recommendations ................................................................................................................................ 9
8. Observation ........................................................................................................................................... 14
9. Conclusion ............................................................................................................................................ 15
10. Reference ........................................................................................................................................... 16
 1. Introduction
Performance Management System is a means of appraising employees at regular
intervals in view of enhancing productivity as well as conducting an evaluation of the level
of growth and development of employees and the organization. Not only does the system
evaluate the year-end report reflecting the total performance, but also, it brings forward a
measure of implementation oriented towards fostering high productivity and efficiency.
The process sets the platform for rewarding excellence by aligning individual employee
accomplishments with the organizations mission and objectives and making the
employee and the organization understand the importance of a specific job in realizing
outcomes.

At Evolution limited (hereinafter referred as Evolution), the Performance

management system aims to achieve the following target:

Enabling each employee to know what is actually been needed and what should be
his role in achieving those targets.
It helps to maintain an honest relationship between the employees.
Enabling each individual employee to feel motivate at work and make him know
about his valued contribution in the project.
Enabling organization to reward the employees for his exceptional contribution to
the company.
Performance management system is being designed to successfully achieve the set
objective as well as it also focus on helping the employees to understand what is
being needed from them and how they could deliver it to the company.

Reward management on the other hand, is basically the way in which that particular
business forms and implements strategies and policies to reward the employees to a fair
standard and in accordance with how the organization values them. It usually consists of
the business analyzing and controlling the employee's remuneration and all of the other
benefits for the employees.

Assessing the Performance and Reward Management System in place at Evolution will
assist in depicting the strengths and weaknesses of such systems in place in view of
bringing forth some recommendations to enhance its functioning at Evolution.
 2. Case Study
Established in 1997, Evolution is an advertising agency which provides a full range of
services from copywriting, advertising, pre-press, to printing and website designing. Its
vision is to be the leading advertising agency in Mauritius. Evolution currently has 130
employees, divided into 7 different departments, each under the supervision of a Head of
department, who along with the Managing Director and the Assistant Managing Director,
constitute the Senior Management, as reproduced below:

Human
Resource HR Assistant
Officers
Manager

Administrative Administrative
Secretary Receptionists
Head Clerks

Graphic
Designers

Production Senior Video and

Manager Designers Sound Editors
Managing
Director Art Director Web
Chairman Photographers
Assistant Website designers
Managing Creative Project
Director Head Manager Web
Programmers
Chief Editor Copywriters

Finance Accounts
Accountant
Manager clerks

Printing Printing
Head Technicians

Marketing Assistant
Marketing
Manager Managers

IT Manager Programmers IT Technicians

The mission of Evolution is to win and attract the loyalty of their customers; therefore they
follow the trend and innovation in the industry. The company is always evolving because
their ultimate goal is to offer the best, latest and leading edge as their key objective is to
have customer satisfaction.

Evolution Ltd has a centralized structure as decision making is kept firmly at the top of
hierarchy (among the most senior management). Thus, the Managing Director has greater
control over the organization.
The companys management strategy main focus is to achieve positive results such as
speeding up of production process to allow the company to gain higher revenue. On each
computer at the production level, there is time management software which measures time
each employee spent on each project daily. Thereby, a study of each workers performance
is carried out by the management level on an everyday basis. This helps for better control
of production and monitoring performance of each employee.

3. Performance Management System

A major part of performance management involves managing employees and managers,
as their performance will have a major effect on the performance of the organization as a
whole.

Managers and employees are expected to work together to plan, monitor and review an
employees work objectives and overall contribution to the organization. The performance
management system of Evolution aims as follows:

Productivity, which involves the specificity of the job;

Setting out the target expected to be reached a certain number of clients per month;
Meeting deadlines;
Monitor and measure results;
Establish clear communication between managers and employees;
Provide training and development opportunities for improving performance;
Establish plans to rectify poor performance;
Open career opportunities

4. Relation between motivation and performance

management
Motivation refers to strengthening of internal activities which drives or boost the
performance of man. There is a direct relationship between performances to motivation; if
an employee is highly motivated then he/she is expected to perform better at job. Theories
suggesting the following implementations are:
Reinforcement theory of motivation - this theory describes the effect of present behaviour
onto its future consequences, focusing on changing the employee behaviour according to
the surrounding situation through four types of operational conditioning:

Positive reinforcement

Motivating employees by the means by increasing wages, giving him bonus or either
promoting him, all this reinforcement is being provided as a reward to the employee to
repeat the desired behavior adapted by the employee at the workforce.

Negative reinforcement

Strengthening the employee behavior and raise it up the baseline attempt like avoidance or
ignorance if the employee is not been working as he/she should be working

Extinction

It is like not providing the employee neither with the positive reinforcement and nor with the
negative reinforcement, if an employee is working then also he is not getting a thanks or a
reward for his work.

Punishment

It is for decreasing the continuity of behaviour which the employee is being following at the
workplace

The reinforcement theory on the management side:

Managers should be informing the employee about the things which they are doing wrong
and shouldn't be repeated while directing them to the way which could help them to receive
positive reinforcement.

Managers should also understand it is important to reward employees for their

performance because if the deserving candidate is not getting the reward then he/she may
not be performing to the level previously used to.

Equity theory of motivation at Evolution- supposing two employees worked equally at office
but an employee A gets 20% percent increment while employee B gets 10 percent
increment. Employee B is pleased with his performance because where other employees
are getting only 6 % increment he got 10% but while comparing to A he will be rather
disappointed therefore people compare their reward to the ratio of the reward what the
other person is getting to the input applied.

Therefore in such a case managers must be very careful while they are rewarding and
provide each employee with a specified target to motivate them and even this removes the
indifference attitude within the employees about others.

5. Performance Analysis
Evolution focuses mainly on the productivity and profitability aspect as each marketing
manager and assistant marketing managers are individually required to meet a target of
certain number of clients per month. When they reached beyond their monthly quota, they
then receive monetary rewards for each additional client they bring to the company. The
idea behind is to encourage the marketing executives to be more productive.

On the other hand, the project managers and the production managers are assigned with
many projects daily and are overwhelmed with works. They have the pressure of providing
superior quality services to the clients as well as keeping companys-client relationship at
high standard. They are usually very busy with day-to-day responsibilities and are always
in a hurry. Most of the times, they do not bother to take time to give clear instructions to
their subordinates. This bad communication causes many problems. The employees at
times have to guess what they are supposed to do which results in poor work performance.
Due to this situation, managers blame their employees for their confusion causing
resentment and anger.

Moreover, poor work performance creates job insecurity as the employee may think their
job is at risk may be more likely to be looking for another job elsewhere. It is inevitable that
some employees may feel underestimated and lose motivation to work efficiently. This is
the reason why Evolution encounters a big problem of retention of employees.

Employees also find it very difficult to have the right balance between their work and
personal life. These have an impact their physical and emotional health and therefore
interfere in the employees productivity and performance.

Managers often neglect the necessary interactions with staff that provide the opportunity to
coach and offer work related feedback. The performance management process forces
managers to discuss performance issues with employees. It is this consistent coaching
and interaction that affects employee development and also promotes good manager-
employee relationship. It is the organizations responsibility to prepare them for increased
responsibility.

Per the policies, managers have to encourage the coaching of poor performer. Evolution
provides the opportunity of training and development to increase skills and competency of
employees. It also helps the employee to be up-to-date with new trend and technology to
be more efficient in their work.

However, in reality, instead of inserting efforts for uplifting of the poor performer, senior
managers would rather terminate the relationship which is unfortunately considered as less
time consuming and cost effective option. Some employees especially those who are in
the operational level, are in the same role for an extended period of time. Therefore, they
do not feel the sense of growth and progress which is essential for high engagement and
high performance.

The Senior Managers are in charge of all major decision of the firm. There are limited
conflicts and clear control of operations since few people is responsible for decision
making. In addition, this eliminates confusion regarding who is accountable for the
outcome of certain decisions.

6. Reward Management
Reward management deals with the strategies, policies and processes required to ensure
that the contribution of people to the organization is recognized by both extrinsic (financial)
and intrinsic (non-financial) means. The overall objective is to reward people fairly,
equitably and consistently in accordance with their value to the organization in order to
further the achievement of the companys strategic goals. Reward management is not just
about pay and employee benefits. It is equally concerned with non-financial rewards such
as recognition, appreciation and development opportunities.

Rewards can be a vital source of motivation for the employees but only if it is administered
under right conditions. Below is listed a few strategies which improve the effectiveness of
rewards:

Linking rewards with the performance;

Implement team rewards for the interdependent jobs;
Ensuring that the rewards are relevant;
Ensuring that the rewards are valued by the employees;
 Analyze the impact of the absence of reward practice.

All aspects of reward, namely salary, employee benefits and non-financial rewards, which
include essential rewards from the work itself, are linked together and treated as an
integrated and coherent whole.

6.1 Reward System Analysis

There are several ways to classify rewards; the three most common types are as follows:

Intrinsic Rewards Vs Extrinsic Rewards

Intrinsic rewards are the personal satisfaction you get from the job itself e.g. having pride in
your work, having a feeling of accomplishment or being part of a team. If an employee
experiences feelings of achievement or personal growth from the job, this would be
labelled as an intrinsic reward.

Extrinsic rewards would include money, promotions and other benefits. Extrinsic rewards
are external to the job and come from an outside source, usually management. If an
employee receives a salary increase or a promotion, this would be labelled as an extrinsic
reward.

Financial Rewards vs Non-Financial Rewards

Financial rewards are those that will enhance the employees financial well-being directly
eg bonus, increase in wages and profit sharing schemes.

Non-financial rewards do not enhance the employee's financial position directly but make
the job more attractive. Some of the Non-financial rewards that a business organization
offer might include-an attractive pension scheme, access to private medical care, help with
long-term sickness, crche facilities, counselling services, staff restaurant etc.

Performance-Based Rewards vs Membership-Based Rewards

The rewards that a business organization gives to their employees can be based on either
their performance or membership criteria. Performance-based rewards are exemplified by
the use of commissions, piecework pay plans, incentive schemes, group bonuses, merit
pay or other forms of pay for performance plans.
Membership-based rewards would include cost of living increases, benefits and salary
increase, seniority or time in rank, credentials or future potential.

At Evolution, the reward system has unfortunately not been developed. Over the years, the
organization has opted for a very simplified reward system consisting of an increase in
salary once in a year. Productivity is the main focus in determining the salary increase that
is the employees have been able to work produce quality work and show discipline at the
workplace. Evolution has a system of monthly monetary reward for the marketing
executives and promotion for the junior designers who excel in their jobs by exceeding
performance benchmarks.

6.2 The relationship between performance management

and reward
Two purposes of reward within a performance management system

In any organization the main purpose behind rewarding employees is to motivate them,
retaining them to the company and reducing the turnover costing. Employees are the most
important valuable possession of the company and it is very important to continuously
encourage them for their contribution to the organization. These reward systems are
mainly been introduced into the company's environment to give a recognition and
encouragement to the committed employee of the company for his extraordinary
performance in the company by this Staffs understand what they are expected to do.

7. Recommendations

7.1 Employee Retention and Engagement Strategy

One of the solutions to the retention of employee problem at Evolution is to create

employee engagement to the organization. It is the extent to which employees feel
passionate about their jobs, are committed to the organization and put discretionary effort
into their work.

At Evolution Ltd, monetary reward is motivational tools available in the company.

Unfortunately, they alone are not the only factors to bring happiness in a workplace. In all
levels of an organization, the top predictor of workplace satisfaction is not pay: It is the
intrinsic rewards, that is, the psychological rewards that employees get from doing
meaningful work and performing it well.

The organization does not give importance to the human aspects of the workers. This
clearly affects production efficiency and cooperation between management and workers.

Most employees have complicated lives. Given the nature of work within the company, if
managers want people to engage with the company, they have to give them a flexible and
supportive work environment. The managers should implement employee wellness
programs such as an in-house gym or yoga classes as research has shown that open,
flexible workplaces have a major impact on engagement.

Moreover, an inspiring manager creates more engaged teams. According to research by

leadership development experts Dr. Brad Shuck and Maryanne Honeycutt-Elliott, higher
levels of engagement come from employees who work for a compassionate leader; one
who is authentic, present, has a sense of dignity, holds others accountable, leads with
integrity and shows empathy.

Another key engagement driver is the need for continuous and ongoing recognition. Hard-
working professionals want to feel they are valued by the organization. They appreciate
being recognized for a job well done. Saying thank you is an extraordinary tool to building
an engaged team. The company should build a culture of recognition and appreciation.
Sincere praise for good work can make an enormous difference for staff retention efforts.
The key to success is to create a social environment where recognition can flow from peer
to peer, freeing managers from being the judge and jury of the employee recognition.

At Evolution Ltd, employees feel uncomfortable to speak up their minds which is a

disadvantage for the company as sometimes employees may hold back valuable ideas
and solutions that could help to push the organization forward. Managers must make it
clear that employees can speak up their minds without the fear of criticism and judgment.

Moreover, managers should never assume that workers will contact them to ask for advice
or alert them of a problem. Managers should not feel confident that every message that
they send electronically will be clearly understood by the recipient. Therefore, managers
should encourage an open-door policy to enhance workplace communication.

The work-life balance is an important factor when employees are deciding whether or not
to stay with the firm. In effort to create a positive work environment that makes employees
want to stay, the company should have the ability to be more creative with policies that
address work-life balance, including flexible work arrangements. A type of flexible
arrangement which can be used is the compressed workweek. Under this arrangement,
employees work the normal number of hours but complete those hours in fewer than five
days. The most common variation of the compressed workweek is the so-called 4/10, in
which employees work four 10-hour days instead of five eight-hour days. This type of
arrangement provides an extra day at home, thus improving work-life balance.

A flexible work arrangement approach helps to build employee loyalty and job satisfaction
and to promote a happier work environment.

Furthermore, the feeling of job insecurity can have a significant impact on employee
engagement. This can cause a negative impact on employee health, that is, symptoms of
stress which will negatively influence engagement and performance. So, managers need
to work to ensure that they are behaving and managing in a way that provides reassurance
to their employees during periods of uncertainty.

7.2 Motivation strategy or how to unleash Evolution LTD employees existing

motivation.
Evolution is so much focus on the productivity and profitability that it demotivates and
decreases its employees performance. Low performance being intolerable in the
company, everyone works like they have a Damocles sword on their head and therefore,
this affects the productivity. Then how can managers motivate employees?
Not because somebody is qualified to do a job, doesnt mean that will do the job.
Managers should ask themselves, what is the job offered and if this is the right motivation
fit for the candidate. In which type of motivation does the candidate fall?
There are two types of motivated employees, the one who seek pleasure and the one who
wants to avoid pain.
The employees who seek pleasure have ambition and accountability. These employees
are motivated by challenges and will search for innovations in the projects they are working
on.
The employees who avoid pain are the one who see threats everywhere. They are
motivated by threats and all the wrongs things that can happen to a project.
Set up meeting with the employees, talking about how they are motivated will help to know
how to communicate with them in their motivation style and bring them on projects that
match their motivations. An employee with motivation for threat wont be able to work on
project that demand research for more opportunities and new projects to bring in.
Instead of putting more pressure on low performed employee and threaten them, the
managers should ask for feedback, and understand what motivates them and whether their
motivation fit in or not. This will make the employee feel valued and make the managers
appear more concerned about the person and why it is that there is a downfall in their
performance. Employers wishing to attract and retain high-quality staff have at least one
new weapon in their arsenal flexible benefits which allow employees to tailor a package
to their own needs. Flexible benefits include such things as private medical insurance,
holidays, pension schemes, childcare vouchers, leisure club memberships and company
cars. Such benefits are not necessarily expensive options for employers, since the
perceived advantage of things like medical insurance, employee discounts and childcare
vouchers is often as much about convenience as it is about monetary value.
75% of employees stay in a company if they know that they have a career ahead instead
of just a job. The future is a great motivator when it is imagined in the actual moment.
Employees are motivated with the feeling and rewards that they will get at the end of their
project or in the near future. This keeps them motivated until their expectations are
reached.
The manager must recall to the employee their personal and professional objectives and
link them with those of the company for finally implementing them in a daily action plan.
This will help the employee to find their core competency which will encourage them to
develop their career path in a positive way.
The manager must encourage the employee to consider the positive aspect in his personal
life, professional and in the environmental in general. He must be a model to his team by
leading them on how to see positivity in everything and every situation instead of focusing
only on what is not working.
In evaluation meeting, invite the employee to start by highlighting all positive events before
talking of negative ones that needs improvement. In other words, instead of seeing the
glass half empty, make the employee see it half full.

During meetings with employee, the manager should ask the right questions that will allow
to find solution and to take action plan in order to help the employee to get closer to their
dream. Listen actively to their answers by nodding meaning that the manager is attentive
and shows interest in the formulated arguments.
It makes sense that Evolution Ltd should invest in tools to measure and act on employee
engagement data in a timely manner. It would be a survey in a daily or weekly manner to
collect views, opinions or feelings of employees anonymously regarding their work
environment and company priorities for improvement in order to give satisfaction to
employees instead of always making clients a priority to their detriment. Evaluation can as
well be a formal weekly meeting between employee and their managers. By analyzing the
data collected, the company can then address certain failures almost immediately.
Employees in the Evolution Ltd are constantly under stress and pressure. They are
expected to give 120% all the time in order avoid being scolded and humiliated in case of
errors or event get fired. The objective of the company is to make a maximum of
production to obtain a maximum of profitability and so in detriment of the welfare of the
employee. The employee are force to work long working hours and do overtime as they
feel stress and fear to lose their jobs.
Why employees at Google office and Facebook office are loyal and happy to work in those
companies? The environment there has been designed for the employees to be productive
at all time as they take into consideration that everyone works differently in their
environment.

Figure 1: Facebook office Figure 2: Google office

The Evolution ltd, if not giving an entertainment and relax work place like these huge
companies, at least reserve an entertainment room for their employees to relax and
evacuate all the stress so they can focus and work better. For example, install a WII game
station. Playing Wii will force the employee to move from their chair and be active. Studies
have shown that people who work a lot in front of a computer have back pain issues
because they are too sedentary and lack physical activities. Moreover, playing video
games force players to think in strategic way and enhance their creativity. What is more
important than creativity for designers in a graphic agency?
Employees should also be free to walk when they feel the need. They should be allowed to
take fresh air as maybe this can boost their creative or consider it a better way to find
inspiration instead of ruminated in a close office.

8. Observation
Performance appraisals should be a celebration of all the wonderful things an employee
does over the course of a year and should be an encouragement to staff. There should be
no surprises if issues are addressed as they arise and not held until the yearly appraisal.
The idea is to focus as much on what the employee is doing well while gently correcting
undesired behaviors. When pay increases and/or bonuses are tied to the performance
appraisal process, the employee can observe a direct correlation between performance
and financial rewards. This motivates and encourages employees to perform at higher
levels.
Productivity is the main focus in determining the salary increase that is whether the
employee has been able to achieve his /her target and the income generated by the staff.
However, no emphasis has been laid upon recovering the fees charged to clients. As such,
whilst the budgeted targets have been successfully met, there is no effectiveness in
collecting the debtors balances which inevitably distort the figures.
Another aspect of the reward system is the quality of work, the customer care skills and the
communication with clients. Clients tend to acknowledge the good work undertaken and
usually show no resistance in settling invoices promptly, which demonstrates a certain
degree of satisfaction.
High or excessive emphasis is laid on discipline, such as punctuality, strict compliance with
prevailing Departmental Rules or Policies, and a zero tolerance policy for violating the
code of conduct.
 9. Conclusion
Performance management processes are a powerful means of providing relational
rewards. They can be the basis for developing a positive psychological contract by
clarifying the mutual expectations of managers and their staff. Motivation can be provided
by feedback. Performance reviews can inform personal development planning, thus
encouraging self-managed learning with the support as required of the manager and the
organization.

The performance management approach has become an indispensable tool in the hands
of the corporates as it ensures that the people uphold the corporate values and tread in the
path of accomplishment of the ultimate corporate vision and mission. It is a forward looking
process as it involves both the supervisor and also the employee in a process of joint
planning and goal setting in the beginning of the year.
10. Reference
Employee Engagement - https://dupress.deloitte.com/dup-us-en/deloitte-review/issue-
16/employee-engagement-strategies.html
Employee Retention - https://hbr.org/topic/employee-retention
https://www.agent.media/lead/employee-motivation-strategy/

http://www.standard.net/Success-Strategies/2014/09/24/10-strategies-to-help-retain-and-
motivate-employees

https://www.inc.com/ilya-pozin/14-highly-effective-ways-to-motivate-employees.html

https://www.forbes.com/forbes/welcome/?toURL=https://www.forbes.com/sites/lisaquast/20
12/01/10/5-tips-for-motivating
employees/&refURL=https://www.google.mu/&referrer=https://www.google.mu/

http://www.jpma.org.pk/full_article_text.php?article_id=6475