Rewards and Incentives Management Harvard Case Solution & Analysis


Eire Corp is a company that manufactures disposal crockery and cups of high quality. However, it was acquired by LIME Company in the year 2014 due to financial issues in the organization. LIME is a well-known low cost leader and has gained rapid growths, which help it to gain a competitive edge as compared to the other rivals in the industry. The number of employees of LIME Company has increased after the acquisition from 30 to 250. Due to this, the company is now facing some organizational issues and it has been noted that the employees are not satisfied with the situation. LIME is earning very well, how ever in the year of the takeover by Eric it faced a loss 5 Million.

The purpose of a reward strategy

The purpose of reward and the most important factor of offering rewards are to motivate the employees. Motivation can be described as a reason that someone has for acting and behaving in a particular manner. This is why motivation is important for an employee because a demotivated employee will not be willing to work or he may not work with the same efficiency as a motivated employee will.

The reward is an element to motivate employees for putting their best effort to generate innovative ideas that lead to successful business functionality and it improves company’s performance financially and non-financially. People may not come to work, continue to work, or work hard for an entity on their own without motivation. A person needs motivation to share and fulfill the organization’s goals.

Reward strategy is the system that makes this happens. Rewards are able to motivate employees and lead to an increase in the company’s financial performance. The reward strategy applied at various companies may differ due to the cultural differences or employees’behavior, and may generate different outputs to the company therefore,it is necessary to understand the reward strategy for the company’s management and its implements.

The objective of developing the reward strategy is to maintain a healthy environment at the business premises. It will then address the contribution of reward strategy in achieving the goals and objectives of a company and provide an informed vision to others companies management on the reward system that can be implied.

Reward strategy is the policy that provides a vision of directions for the company to develop and design goals, which would en sure its rewards and its outcomes supporting the success of its business goals. Reward strategy gives direction that how a company designs its individual reward programs. A reward strategy can be an effective utilization of the pay system as an important integrating mechanism through which the efforts of different units and individuals of a company are directed toward the achievement of a company’s objectives.

Relationship between Reward and Business Environment

The relationship between the reward system and the business environment is directly related to each other. When a company is in a bad phase and the employees are not feeling good about their jobs, it is very important to have a good reward strategy to motivate the employees and improves the company’s environment.

When a reward strategy has been implemented in a company, which is not suitable for the company’s environment, then the employees will get demotivated instead of getting motivated. It is very important for a company’s management to look for a reward system that suits the company’s environment. A bad fit can create too many problems for the company.Rewards and Incentives Management Case Solution

If a reward strategy is a bad fit for the company, then the company will lose its potential and may lose his status in the industry if everyone gets to know that the strategy implemented in the company is a bad fit.

Reward strategy and business environment are closely related to each other and rewards are used to improve the business environment by giving rewards. Rewards improve the business environment and its employees by increasing motivation, increasing company morale, increasing company loyalty, increasing productivity, increasing objective achievements, reducing company costs, reducing absenteeism, increasing team work and decreasing employee turnover(Gilbert, n.d).

Proposed Reward strategy

In this case, it has been acknowledged by the company’s management that the employees are not satisfied with what they have right now. The major problems in the company are demotivated employees, role ambiguity, increased expectations of the company from its employees and vague organization's strategy due to merger.

It can be proposed that a better or suitable reward strategy would be the one who can handle all the above issues or which can resolve all such issues of employees. Reward strategy should always be based on the performance of an individual, a group or a team or on a company level reward.................

This is just a sample partial case solution. Please place the order on the website to order your own originally done case solution.

Share This


Save Up To




Register now and save up to 30%.