Rewards can be defined as things that motivate employees to work harder. Rewards and recognition are some of the ways that can be used to motivate employees into achieving the objectives of an organization. There are many types of rewards and most of them are associated with direct costs. However, there are two main types of rewards, monetary and non-monetary. Monetary rewards include cash bonuses, holiday allowance, car allowance, salary increase, and many more. Nonmonetary rewards are intangible but are as effective as the monetary rewards, they include promotion, formal acknowledgment, opportunities for career development, and the list is endless.
Singling out and rewarding workers inspires them to look for ways of undertaking their tasks effectively and lack of it can completely dishearten them. A reward system has to be effective and be able to instill the desired behavior for efficient performance. The main goal of rewards is to improve individual performance as well as that of an organization. They are also used to retain top-performing employees. To achieve these goals, the reward system should be in line with the organizational goals and strategies. The best rewards systems for Allstate should be those that help it to achieve its diversity goals. Research has found that more than 50% of employees are motivated by the recognition they get from the people they work for. This includes recognition by managers or supervisors. People need to be encouraged and appreciated in order to achieve their mission and that of others. Another reward system would be to base reward on an individual’s performance. These rewards should be able to offset the work done by the employees. It is only through this considerate rewarding that employees are motivated to work even harder because they expect the rewards to rise as their performance rises.