TABLE OF CONTENTS
CHAPTER ONE
BACKGROUND OF THE STUDY
1.1 Introduction
1.2 Statement of the Problem
1.3 Objectives of the Study
1.4 Significance of the Study
1.5 Research QuestionS
1.6 Scope of the Study
1.7 Limitation of the Study
1.8 Definition of Terms
1.9 brief history of skye bank plc
CHAPTER TWO
LITERATURE REVIEW
2.1 Conceptual Meaning of Compensation
2.2 Compensation System
2.3 Reward Strategy
2.4 Theory Basis of Total Reward Strategy
2.5 Dimensionalities of Total Reward Strategy
2.6 Management Role of Total Reward Strategy
2.4 Job Analysis and Job Evaluation
2.4.1 Methods of Job Evaluation
2.5 Objectives of Compensation System
2.6 The Effect of Rewarding Performance on Productivity in an Organization
2.7 Factors that Influence Employees Productivity
2.8 Factors that Influence Employees Reward System The reward system does
2.9 Problems of Implementing Compensation and Reward Policies
2.10 Suggested
Solutions to Problems of Implementing Reward and Compensation Policies
2.11. Decision
making in compensation management
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Introduction
3.2 Research Design
3.3 Area of the Study
3.4 Population of the Study
3.5 Sample Size and Sampling Technique
3.6 Instrument of Data Collection
3.7 Validation of Instrument
.3.8 Reliability of
Instrument
3.9 Method of Data Collection
3.10 Method of Data Analysis
CHAPTER
FOUR
DATA
PRESENTATION AND ANALYSIS
4.1 Introduction
4.2 Characteristic of
Respondents
4.3 Data Analysis
4.4 Summary of Findings
4.5 Discussion of Findings
CHAPTER
FIVE
SUMMARY
CONCLUSION AND RECOMMENDATIONS
5.0 Introduction
5.1 Summary
5.2 Conclusion
5.3 Recommendations
.REFERENCES
APPENDIX
CHAPTER ONE
BACKGROUND OF THE STUDY
1.1 Introduction
Organizations are established with primary aim of making profit and
a secondary aim of effective utilization of available human and non-human
resources. Among these resources is human, which is commonly seen as the most
valuable asset an organization could use to earn competitive advantage and
achieve its objective, hence the need for human resources management to ensure
optimum productivity and organizational continuous existence.
Human resource has been tagged the most valued asset of any
organization. Its strategic approach emphasized a “tight fit” between
individual needs, rights, ambitions, and goals within the organization which make
compensation system central in the affairs of emerging students, scholars and
HRM practitioners in the world over. The emergence of human resource management
posed great threat to the conventional personnel management and industrial
relation because it evolved from the core approach or organization
relationship. It is an asset that should be invested upon so as to provide
long-term commitment and high performance in an organization. As organizations
strive to achieve one or more objectives through exhaustive utilization of
human capital, so also, the employees aim toward achieving individual purpose
(objective) while working for the organization.
Reward system is the instrument used to increase employees’
productivity. It seeks to attract and retain suitable employees, encourages
good management – employee relationship and commitment and minimizes tension
and conflict as it deals with all forms of final returns, tangible service and
mechanism for good relationship. Furthermore, the major case of industrial
conflict is based on the fact that employees feel their benefit are denied or
about to be denied thus the importance of compensation system is to provide a
good platform for equity and farness. This provides a challenging environment
and increase productivity of employees. The compensation system ensures that
both intrinsic and extrinsic needs of employee at all levels are adequately
provided for compensation develops organizational integrity, policy, procedures
and practices capable of improving organizational productivity. Reward and
compensation is concerned with employees and organization performance
development through which better result can be achieved by understanding and
managing reward and compensation within an agreed framework, planned goals, and
standard and competency requirements.
However, the success of the industry rests so much on its human
resources capability, which is the most valuable asset of any sources
capability, which is the most valuable asset of any organization. The challenging
tasks of every manager at all level are how to build a befitting reward and
compensation system to incorporate both organizational goals and individual
needs, thus, have a motivated workforce and improve productivity. Therefore,
this research work seeks to look into reward and compensation system and its
implication on workers’ efficiency in the financial industry (Skye Bank Plc as
case study). The industry has proved to be one of the most valuable in Nigerian
economy and the productivity of the industry cannot be refrained from as well
as its rewards and compensation structure, directly or indirectly.
This study examines the impact of reward and compensation system on
organizational productivity, the base of good reward and compensation
structure, employees’ expectation at different levels and how the compensation
structure is based on performance of individual(s) or job requirement of
employees. The researcher therefore tends to draw attention of management of
organization to the need for effective and efficient reward and compensation
system capable of improving employees’ performance and enhance organizational
productivity.
1.2 Statement of the Problem
Some organizations over the years see employee as additional cost
as well as liability to their operations, hence do not remunerate them
appropriately, and where it is more appropriate, the compensation is not
commensurate with the efforts and skills that workers put into the
organization’s activities, instead of paying attention on how employees will be
compensated appropriately, some organizations concentrate more on other
resource, such as materials, machines and money. The effort is more on how to
improve the production process with little or no consideration for human
efforts.
This had led to the inability of such organizations to attain their
set objective, organization success relies heavy on how much attention pay to
its employees’ reward policies. It is in view of this that the study seeks to
know how reward and compensation system in organization affect the performance
of employees as well as that of the organization in general.
1.3 Objectives of the Study
The major objective of this study is to examine and assess the
impact (if any) of reward and compensation system on the productivity of employee
in an organization. The specific objectives therefore, are to;
§ Draw
the attention of management to prompt, timely and adequate compensation of
employee.
§ Analyze
the available reward package and how it affects employees and organizational
performance.
§ Ascertain
the need for management to create conducive working environment by providing
both physical and psychological incentives to make employees more committed to
organizational goals.
§ Encourage
a good reward and compensation policy which should be channeled toward
increasing organizational productivity.
1.4 Significance of the Study
The importance of this study cannot be overemphasized due to the
fact that, it holds a lot benefit to ensure continuous existence and survival
of organizations, the study will be great benefit to manager or human resource
department of organizations regarding the identification of effective reward
and compensation, system, its cost and benefit on organizational operations,
harmonizing employees and organizational interest to avoid sub-optimality etc.
In addition, the study clarifies the argument on weather effective
reward and compensation system adds value to organizational activities, which
will enable organizations take profitable side on whether to compensate
employees or not.
Knowledge they say, is power this research work exposed the
researcher to many practical issues on human resource, reward and compensation
system and the respective relationship that exist between effective reward and
compensation system, productivity customer patronage as well as organization
productivity and profitability.
1.5 Research QuestionS
§ What are the benefits of prompt compensation to
employees in the organization?
§ How can a reward package affect the performance
of an employee in an organization?
§ How does a conductive working environment make
an employee committed in attaining organizational goals?
§ What compensatory benefits can the employers
put in place to encourage employees?
1.6 Scope of the Study
This research work is
undertaken to analyze the impact of reward and compensation system on the
productivity of employees in an organization though employees reward and
compensation system is just one of the various tools used to ensure effective
human resource management, but the study strictly concerns itself with reward
and compensation, its system and its impact in enhancing organizational
productivity and profitability.
In addition, the research
work is carried out to study the impact of reward and compensation system on
the productivity of employees in Skye Bank Plc.
This therefore shows that the study neither cover every organization in
the financial industries nor has it cover every branch of Skye Bank Plc ,but
Skye Bank Head office, 3 Akin Adesola Street, Victoria Island, Lagos.
1.7 Limitation of the Study
A research work of this
nature is however unpleasant with numerous problem that limit the researcher
ability especially in Nigeria where many organizations do not disclose the true
information about their organization to researcher.
The researcher found it
difficult to access meaningful data concerning the organization reward, policy
but has to use the limited information available. Nevertheless, the research
work was adequately covered based on the available information to the
researcher although it is difficult to claim a total perfection. Therefore the
topic is opened for further build up consideration and research.
1.8 Definition of Terms
Compensation: Compensation of all form of financial return,
tangible services and benefit an employee receives as part of an employment
relationship.
Industry: This is the group of firm that engage in the
production of similar product (i.e. goods / services)
Productivity: Productivity is the output unit / per labour
input into the production process given the level of existing technology.
Management: This is the process of planning, organizing, staffing, leading,
directing, coordinating and controlling available resources toward s achieving
a target objective.
Reward: This is the cor-faced of an employment relationship. Reward system
consists of an organization’s integrated policies process and practices for
rewarding its employees in accordance with their contribution skills competence
and their market worth.
Remuneration: This is the financial reward accruing to employee for his or her
performance in the organization.
Motivation: It is the inner drives that arouse direct and maintain an
individual behavior toward accomplishing organization goals.
Research: Is a way of arriving at a dependable solution to business and
management problem through a systematic way of data collection, data analysis
and data interpretation.
Pay Structure: Is a framework for managing base pay progression over time for
employee benefit.
Policy: Is organizational guiding principles that regulate its operation
and activities.
Job Analysis: According to Raymond, et.al (2004) it is the process of getting
detailed information about jobs.
Job Description: Is the setting out of the purpose of job, where it is fit in the
organization structure the content within which the job holder function and the
principal accountability of job older. Main task the employee has to carry out.
Job Enlargement: Is the act of combining previously fragment
task into one job to add greater autonomy and responsibility to a job and is
based on the job characteristic approach and maximizing the interest and
challenges of work.
Job Evaluation:Is a systematic process for establishing the relative worth of job
within an organization.
Reward Strategy: It is a definition of the intention of the organization on how its
reward policies and process should be developed to meet business requirement.
1.9 brief history of skye bank plc
Skye Bank Plc has evolved into one of the top financial
institutions in Nigeria, after its very seamless consolidation exercise in
2006.
It operates as a group that provides facets of financial products
and services powered by a purpose-built technological framework that supports
the service delivery process to customers. With a cumulative wealth of
experience that spans over 50 years, Skye Bank Plc is historically one of the
oldest banks in Nigeria and West Africa. It is quoted on the floors of the
Nigerian Stock Exchange with over 450,000 diverse shareholders with a
shareholding structure that puts no more that 5% in control of any one
individual or company.
With a vision to be a leading and first class commercial bank, it
has been able to distinguish itself in the Nigerian banking industry through
excellent service quality steeped in the use of information and communication
technology.
Skye Bank is also known for its core and ethical value of service
excellence, integrity, continuous learning, partnership and trust.
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