Business Feasibility

The analysis of effective incentives and reward system of Barclays Bank Plc

Executive summary

11.4 Employees learn to adjust their behaviours as they experience the response to those

behaviours. If there are no other significant forms of recognition for good

performance, bonuses for achieving financial outcomes will be seen as the major

organisational response employees experience. Financial outcomes then become

what employees believe the organisation values. Incentive pay systems can be

effective in sending signals about what an organisation values.

Introduction

Reward Systems, defined as a structured method of evaluating and compensating employees based on their performance, are important for any company. Reward systems can help to boost company morale, as well as productivity levels which increase overall revenue for the company.

The wealth of new rules and guidelines mean the increasingly delicate task of creating an incentive package that is aligned with shareholder value, while retaining and motivating executives. The frequency, with which companies re-design their executive reward programmes, with long-term incentives posing a particular problem, testifies to the difficulty of getting them right.

The banking industry has been criticised for rewarding excessive risk-taking with its bonus culture. This report focus on challenges of establishing effective incentive and reward system of Barclays, a British multinational banking and financial services company headquartered in London, and the improvement towards these challenges.

Reward system challenges (requirement 1)

Identify the main EXECUTIVE reward system challenges.

Although monetary rewards do not always satisfy the set of evaluation criteria well,

they are in common use because they tend to satisfy the criteria better, on balance, than

do the reward alternatives in a broad range of settings.

Reward is a key tool for attracting, retaining and motivating those individuals...