Final answer:
When defining the role of compensation in a reward strategy, it is critical to consider the compensation system behavioural objectives, the nature of rewards, and how they influence job satisfaction and effort. Rewards must align with organizational goals, employee values, and the specific context to effectively motivate and satisfy employees. option c.
Step-by-step explanation:
When defining the role compensation will play in your reward strategy, one key factor that needs to be examined is the compensation system behavioural objectives. This involves understanding how different types of rewards (both intrinsic and extrinsic) can motivate employees and align with the goals of the organization. For example, efforts suggest that people should be rewarded according to the effort they put forth in their activities. Moreover, it is essential to consider how compensation and its structure align with the cost individuals incur in their work activity.
Research highlights that intrinsic rewards, such as work content and autonomy, are more strongly predictive of job satisfaction than financial rewards. Recognizing the nature of these rewards, alongside compensation, assists in creating a robust reward strategy that fosters motivation and job satisfaction. When compensation is expected, it can diminish intrinsic motivation; however, when given unexpectedly, it can reinforce intrinsic motivation.
Additionally, considering past experiences, beliefs and values, and the context of the reward structure is crucial in the implementation of a reward strategy, as suggested by reciprocal determinism and observational learning theories. Taken together, these factors help to create a comprehensive and effective compensation and reward system within an organization.