PP605 BUSINESS RESEARCHFINAL REPORT

TITLEENCOURAGE RETENTION THROUGH REWARDS MANAGEMENT MAXIMIZATION

LECTURERMADAM EMILYA BINTI ZURDA

SUPERVISORMR MOHD FAIZAL BIN MUSLIM

GROUP MEMBERS

MARGARET ANDREW11DPI10F2025CHIN KIEW YEN11DPI10F2045NAJMUDDIN BIN AZIK11DPI10F2003MOHAMAD HAZIQ BIN ISMAIL11DPI10F2009NURUL EMILIYANA BINTI ZAIHAN11DPI10F2027

TABLE OF CONTENTTITLEPAGES

LIST OF CONTENT

ABSTRACT

PROBLEM STATEMENT

RESEARCH OBJECTIVES

LITERATURE REVIEW

METHODOLOGY

RESEARCH FINDINGS

CONCLUSION & RECOMMENDATIONS

REFERENCES

ABSTRACT

The concept of employee turnover intention has become one of the most important topics in organization. Some of the scholars come up with a lot of factors that could give impact on turnover intention; however there are other factors such as organizational culture and organizational commitment organizational person fit also could give impact towards turnover intention. Different companies are providing different working environment, facilities, management and rewards. The purpose of this researchis toexaminehow toencourage retention through rewards management maximization.

In the contemporary world, rewards for better performance and success matter more than the actual achievement itself. Indeed, as the global financial crisis showed, rewards were everything for bankers as they strove for more reckless bets and increasing risk taking. Because of the system of flawed incentives, rewards were seen to the ultimate prize that was greater than the actual process of winning.

Hence, rewards management has to be seen in the context of what are proper and just rewards and what are the reasons for turnovers. The point is here that rewards ought to justify the performance and not exceed them. Apart from that, a proper reward system in organizations would be aligned with the correct strategic fit between internal motivation and external rewards and only when they are in balance can organizations grow in a healthy manner.

The purpose of this research is to know the cause of turnover among employees and what tactics that an organizations do to encourage retention through rewards given by management. In order to conduct this research, we have chosen two different companies which are United Meteoric Group which is in Malacca and PKT Logistic which is in Shah Alam. Both companies have similarities as they are conducting outsourcing marketing.This research aims to help organizations encourage retention through rewards given by the management as well as reducing the rate of turnovers and not satisfy of employees.

Problem Statement

This research are focussing and emphasizing on the reason of turnovers among employees in both organizations as well as to determine how both organizations encourage retention among their employees through rewards management programme. In this research, we want to identify what the cause of turnovers among the employees and to encourage retention towards rewards management system of the organizations.

That is two different companies we take action and did a survey on PKT Logistics Group which in Shah Alam and United Meteoric Group which in Melaka Raya. Determine the different working environment in different field of business between these two companies. Identify how they appreciate and treat their employees and what would they do to retain their employees by using what kind of rewards.

RESEARCH OBJECTIVES

From the research that we had conducted, we are able to determine:

The statistics number of turnovers in both organizations. The qualification that an employee should have in order to be rewarded. The factors that influencing employees turnover in both organizations. Ways on how an organization can avoid turnover among the employees. How does the reward management system acts as a medium in retaining the employees The types of rewards and redemption required by the employees.

LITERATURE REVIEW

RETENTION

According to the Oxford Advance Leaners Dictionary, the word retention is referring to the action of keeping something or someone rather than losing it or stopping it. In this perspective, we are looking at the point of the employees retention, which refers to the ability of an organization to retain its employees. However, many consider employee retention as relating to the efforts by which employers attempt to retain employees in their workforce.

In the business setting, the goal of employers is usually to decrease employee turnover, therefore decreasing training cost, recruitment costs and loss of talent and organizational knowledge. Employers can seek positive turnover whereby they aim to maintain only those employees who they consider to be high performers.

An alternative motivation theory to Maslows hierarchy of Needs is the Motivator-Hygiene (Herzbergs) theory. This theories overlap, but the fundamental nature of each model differs. While Maslow Hierarchy implies the addition or removal of the same need stimuli will enhance or detract from the employees satisfaction, Herzbergs findings indicates that factors garnering job satisfaction are separate from factors leading to poor job satisfaction and employee turnover.

Based on the businessdictionary.com, the key word of employee retention refers to an effort to maintain a working environment which supports current staff in remaining with the company. Many employee retention policies are aimed at addressing the various needs of employees to enhance their job satisfaction and reduce the substantial costs involved in hiring and training new staff.

The main purpose of retention is to minimize the cost of recruitment, training and others. Here are some tips on employee retention:-

Demonstrate leadership commitment and accountability Hire and train the right people Establish special emphasis programs and collaborate with affinity groups Improve advancement opportunities Conduct employee opinion (climate) surveys and 360 degree evaluations.

These are some tactics to retain employees that is used in an organization.

Offer a competitive benefits package that fits your employees needs.Providing health insurance, life insurance and a retirement-savings plan is essential in retaining employees. But other perks, such as flextime and the option of telecommuting, go a long way to show employees you are willing to accommodate their outside lives.

Provide some small perks.Free bagels on Fridays and dry-cleaning pickup and delivery may seem insignificant to some companies, but if they help employees better manage their lives, theyll appreciate it and may be more likely to stick around.

Use contests and incentives to help keep workers motivated and feeling rewarded.Done right, these kinds of programs can keep employees focused and excited about their jobs.

Conduct stay interviews.In addition to performingexit interviewsto learn why employees are leaving, consider asking longer-tenured employees why they stay. Ask questions such as: Why did you come to work here? Why have you stayed? What would make you leave? And what are your nonnegotiable issues? What about your managers? What would you change or improve? Then use that information to strengthen your employee-retention strategies.

Promote from within whenever possible.And give employees a clear path of advancement. Employees will become frustrated and may stop trying if they see no clear future for themselves at your company.Foster employee development.This could be training to learn a new job skill or tuition reimbursement to help further your employees education.

Create open communication between employees and management.Hold regular meetings in which employees can offer ideas and ask questions. Have an open-door policy that encourages employees to speak frankly with their managers without fear of repercussion.

Get managers involved.Require managers to spend timecoaching employees, helping good performers move to new positions and minimizing poor performance.

Communicate your businesss mission. Feeling connected to the organizations goals is one way to keep employees mentally and emotionally tied to ones company.

Offer financial rewards.Consider offering stock options or other financial awards for employees who meet performance goals and stay for a predetermined time period, say, three or five years. Also, provide meaningful annual raises. Nothing dashes employee enthusiasm more than a paltry raise. If the management can afford it, give more to the top performers. Or, if the management doesnt want to be stuck with large permanent increases, create a bonus structure where employees can earn an annual bonus if they meet prespecified performance goals.

Make sure employees know what you expect of them.It may seem basic, but often in small companies, employees have a wide breadth of responsibilities. If they dont know exactly what their jobs entail and what the management need from them, they cant perform up to standard, and morale can begin to dip.

Hire a human-resources professional.If the company is nearing 100 employees, consider hiring a human-resources director to oversee and streamline the employee structure and processes. Putting one person in charge of managing employee benefits, perks, reviews and related tasks takes a huge load off and makes sure employees are treated fairly. HR managers are also more up to date on employment laws and trends. They can set up various programs and perks that management may not have known existed.

REWARD

According to Oxford Advance Leaners Dictionary, rewards refer to a thing that you are given because you have done something good, worked hard. Apart from that, in the business setting rewards bring motivation. Employee motivation occurs when management takes steps to foster a work environment where employees are self-driven to perform their job tasks at a level that meets or exceeds managements standards. Employers can see a spike in the level of interest among employees with a well planned reward system. If the system continues successfully, even greater performance level and job satisfaction can be achieved.

Rewards, whether in the form of gift cards, cash, or time off, increase performance. Employees often come to work with a new attitude once a reward system is put in place, and executives see a healthier and happier work environment. In fact, employee incentives programs can increase overall reduce turnover, boost morale and loyalty, improve employee wellness, and increase retention. Aside from motivation, many believe that spending more on benefits is worth it, because it attracts, maintains, and retains outstanding employees.

Furthermore, Reward managementis concerned with theformulationandimplementationofstrategiesandpoliciesthat aim to reward people fairly, equitably and consistently in accordance with their value to the organization.

Reward management consists of analyzing and controlling employee remuneration and all of the other benefits for the employees. Reward management aims to create and efficiently operate a reward structure for an organization. Reward structure usually consists of pay policy and practices, salary and payroll administration, total reward, minimum wage, executive pay and team reward.

Rewards serve many purposes in organization, build a better employment deal, hold on good employees and to reduce turnover. The principal goal is to increase people willingness to work in ones company, to enhance their productivity.

Most people assimilate "rewards", with salary raise or bonuses, but this is only one kind of reward, extrinsic reward. Studies proves that salespeople prefer pay raises because they feel frustrated by their inability to obtain other rewards,but this behavior can be modified by applying a complete reward strategy.

There are two kinds of rewards: Extrinsic rewards: concrete rewards that employee receive. Bonuses Salary raise Gifts Promotion Other kinds of tangible rewards Intrinsic rewards: tend to give personal satisfaction to individual[7] Information / feedback Recognition Trust Relationship Empowerment Monogrammed name plaque

Intrinsic rewards makes the employee feel better in the organization, while Extrinsic rewards focus on the performance and activities of the employee in order to attain a certain outcome. The principal difficulty is to find a balance between employees' performance (extrinsic) and happiness (intrinsic).

The rewards also need to be according to the employees personality. For instance, a sports fan will be really happy to get some tickets for the next big match. However a mother who passes all her time with her children, may not use them and therefore they will be wasted.

When rewarding one, the manager needs to choose if he wants to rewards an Individual, a Team or a whole Organization. One will choose the reward scope in harmony with the work that has been achieved.

Individual Base pay, incentives, benefits Rewards attendance, performance, competence Team: team bonus, rewards group cooperation Organization: profit-sharing, shares, gain-sharing

MAXIMIZATION

Organizations allocate money toward employee rewards because they want to see a return on investment in terms of motivation, retention, performance and ultimately, decreasing number of turnovers among employees. HR is tasked with designing HR levers that will build competence and process knowledge on improving work quality of employees. Compensation and rewards are HR levers organizations use to achieve this.Reward Maximization is ultimately where business value is created in most organizations, which means the employees will get the highest return on rewards based on the roles of their performance.Applying a limited budget to the areas of the organization where rewarding performance can have themaximumimpact on the employees workforce because that's ultimately where job satisfaction and retaining employees can be created.

METHODOLOGY

RESEARCH DESIGN

Research design for this study was descriptive research study aimed at to give a systematic description of the facts and characteristics of the field reviewed and accurate facts. This study reviewed only for groups only. Findings this study reviewed only for groups only and should not be generalized to the population.

RESEARCH SAMPLE

Our research methodology requires gathering relevant data from the specified documents and compiling information from the internet in order to manage the research and complete it successfully with full understanding. Moreover, we used the interviews methods with the questionnaires sample and collecting data from our respondents. The questionnaire that we used in this research has been attached on the next page.

This project will utilize both quantitative and qualitative data collection tools, but is rooted in a qualitative epistemological position that recognizes the importance of locating the research within a particular social, cultural, and historical context. It also takes seriously the social construction of these contexts and the identities participants construct within them.

TITLE : ENCOURAGE RETENTION THROUGH REWARDS MANAGEMENTThis questionnaire is conducted by Polytechnics Malacca students on behalf our majoring course Diploma in International Business for the subject Business Research. Based on this response of this questionnaire, we will able to determine the satisfaction and the retention of the employee by maximization the rewards management.GENDER : MALE FEMALE AGES : ___________ RACES : MALAY CHINESE INDIAN OTHERSNo.ITEMSYESNO

1.Do you have rewards and recognition on your achievements?

2.Does the retention bonus have any impact on the motivation levels and performance of an association?

3.Does fun at work have any have any impact on Motivation levels of employees?

4.Will you go to the new company to get improvement of your skills?

5.Does the organization have a maximum utilization of the potential skills of the potential skills of their resources?

6.What could be the company have done differently that could have caused you to stay with the company?Give a reason

7.Are you been rewarded for the quality of your effect in the company?

8.Are you satisfied with the salary giving based on your job position?

9.Is it important that appreciation for your work by your co-workers & supervisors is necessary?

10.Are you satisfied with the facilities provided by the organization?

Thank you for the co-operations for answering all the questions above. Your co-operation is much appreciated.

RESEARCH INSTRUMENTS

Researchers use questionnaires and interviews as research tools to gather information of background samples and answer items related questions in this study. The rationale researchers used questionnaires are based on the opinion KontingMajid (1993) who argues that questionnaires used to obtain information on the facts, beliefs, feelings, requirements and so on. Tuckman (1985), argues that the questionnaire is an effective way to obtain information from respondents apart from observations of behavior. Isaac and Michael in Ghazali (2002) also highlights the idea that almost whether the questionnaire was used to obtain information about the facts, beliefs, feelings, etc.These interviews will be recorded through respondents verbatim.

DATA COLLECTION

Data collection will consist of surveys and interviews with employees. Initially, a survey instrument to measure employees view and opinion regarding professional roles of company in retain their workers. The surveys may takes about 2 weeks start from 7 September 2013 (distribute) until 20 September 2013 (collect). Subsequently, a purposeful sample will be identified to worker in the second round of data collection. A structured observation protocol will be developed to aid in field note collection and an interview protocol rooted in the literature will be developed to act as a guide for the semi-structured interviews. Multiple interviews are planned with each worker in order to provide more in-depth data collection and opportunities for follow-up. The goal is to interview approximately 15 - 20 workers who embody a range of identity positions that come from different companies.

DATA ANALYSIS

Data will be collected over two weeks period. Face to face and in depth interview will be conducted by the researcher. The length of face to face interviews will be a maximum of 12 minutes. Dates of appointment will be fixed for in depth interviews with the relevant members of the management in order to avoid any last moments cancellation. All in depth interviews will be audio-recorded which according to Saunders et al (1997) will ensure that data is not lost. By taking this dual approach the moderator will be able to assess various non-verbal reactions of the respondent.

RESEARCH FINDING

United Meteoric Group

Strategy Used to retain the employeeThere are about 500 employees in this company .The organization is playing an important role in employees welfare to satisfy and motivate the employee by providing the most comfortable ,fun, and stress free working environment for the employees. In additional, they are also provided the employee training, seminar as well as IQ test to be answered at the end of each task given for motivation to work hard and get rewards and in return to increase they knowledge on the job they are doing.

This company retains their employees by offering variety of rewards. For example, based on our interview with the HR Manager, Mr. Suren, he said that the they do not want their employees to stress up themselves when a task given, therefore they will always give exceptional if they have done well in the task given by allowing them to take paid leave or by going home early. This can be seen clearly in the sales department, where the employees need to do field work all the time since this company is an outsourcing company. Therefore whenever any of their employees reached the targeted sales for a day, the manager will allow them to return home early and as a reward allowing them to go on a paid leave for a day. This retaining technique that caught our eyes as not many company is willing to like this company. Overall, we find that the management systems are very good and very fair in treating all the employees. Their relationships among the worker in the organizations are like family

Types of Rewards UsedThere are 2 types of categories which are monetary and non-monetary rewards systems.

Non-Monetarya.) Company tripThere are a annual or semi-annual company trip for all the staffs to have fun together with their managers and leaders to a overseas trip for them employees to release stress of working hard in the office. These benefits are very good strategy to retain the employees because they feels appreciated and the trip actually can improve the relationship of among lower and higher management.

b.) Monthly RewardInstead of just giving salary and bonuses to the employees, they create some special activities which never done by others company before, this challenge however has two different categories.Category 1: if any of the employees have succeed by achieving the target of having 50 customer in a month, they will be rewarded a mobile hand phone of any well-known brand that the company will offer.Category 2 : if any of the employees succeed in having 100 customers in a month, they on the other hand will be rewarded an Acer laptop by the company.

c) Outstation trips representing the companyif the employee had done all the given tasks well, achieved the targeted goals, have a good and high discipline level and also pass excellent in the IQ test all the time, these kind of employee will be given the opportunity by the company to represent them in seminars or meetings .This method is not only rewarding them but eventually it is also to increase the knowledge of the employee and allowing them to have all the leadership quality in them.

d) Offering an outsourcing marketing trip to overseas.This technique is used to encourage the employees to work hard and strive the goals of the company and to create a competition atmosphere among employees to achieve this reward. This reward will be given to employees that deserve and had work hard throughout the year and that management is able to see the progress of the employee itself, then only they will be able to accompany the managers, team leaders to do outsourcing marketing in countries such as Bangkok, Australia, Singapore, Korea and soon to come is in Indonesia.

Monetary Reward

PKT Logistic Group

Strategy Used to retain the employee

There are about 380 employees in theThey playing an important role in employees welfare to satisfy and motivate the employee by providing the most comfortable working environment for the employees. In additional, they are also provided a lot of facilities to the employee for motivation to work hard and get rewards.

The special facilities provided such as their gym room and a rest hall that giving fully relaxing. They are making sure that the facilities provided are fully utilize by the employee. They hired a fitness trainer to lead the employee to play gym in a correct way to prevent them misuse and cause of injury.

The management systems are very good and very fair in treating all the employees. Their relationships among the worker in the organizations are

Rewards

There are categories to 2 types, that is monetary and non-monetary rewards systems.

Monetarya.) Company tripthere are a annual or semi-annual company trip for all the permanent staff have fun together with the owner of PKT logistics, Dato Michael to a overseas trip for them employees to release stress working hard in the office. These benefits are very good strategy to retain the employees because they feel appreciated and the trip actually can improve the relationship of among employee b.)Weight loss challengesInstead of just giving salary and bonuses to the employees, they create some special activities which never done by others company before, that is some extra activities, for example like weight lost challenges, the person who entertain us that is Ms Ng from HR department, she is the one of the winner that in this weight loss challenges, she loss 8kg in 2 months and she get to go for a Bangkok trip with her families member for free.

Non monetarya.) Best Employee performance

b.) Best Employee innovation

Turnover Rate in PKT Logistics

Reasons are due to personality as the exit interview they have done, the example reason is that the employee are turn to be a housewife or further studies.

DISCUSSION

CONCLUSION & RECOMMENDATIONS

REFERENCES