Question

The strategic role of a company's reward system is to:

A. Compensate employees for performing their assigned duties in a diligent fashion
B. boost employee morale in ways that create widespread job satisfaction
C. enlist employees commitment to successful strategy execution and operating excellence by rewarding them, both monetarily and non-monetarily, for their valuable contributions.
D. relieve managers of the burden of closely monitoring each employee's performance.
E. boost labor productivity and help lower the firm's overall labor costs

Answer 1

The strategic role of a company's reward system is to align employees' commitment with the company's goals by providing monetary and non-monetary rewards for their contributions, supported by organizational and efficiency wage theories.

Step-by-step explanation:

The strategic role of a company's reward system is best understood in the context of how it aligns employee behavior and motivation with the goals and success of the company. Option C correctly states that a reward system exists to enlist employees' commitment to successful strategy execution and operating excellence. The reward system does this by providing monetary and non-monetary rewards for their valuable contributions. This strategic function is supported by various organizational theories, including effort theory, which suggests that rewards should be tied to the effort put into work activities, and efficiency wage theory, which posits that higher pay can lead to greater productivity as employees are motivated to work harder and remain with the current employer to maintain their higher wage level.