I. considered as reward may differ and therefore it

I. Executive Summary

        Title:                  Rewarding performance system in banking sector. 

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!

order now

  Background:            the purpose of the rewarding systems is to motivate the employees and encourage them to deliver sufficient actions .

Problem:            what is considered as reward may differ and therefore it can be a problem for an organization to meets everyone’s needs .

Aim:                   the purpose of this research is to know what reward system blom bank implement to motivate his employees , and to find the challenges and obstacles that the bank may have.

Methodology:             in this research qualitative method was used, different data for various studies regarding rewarding systems are gathered 

 according to Armstrong (1993) you can divide motivation into two types: 

1- Intrinsic motivation: people motivate themselves in a special way or to move to a particular path
2- Extrinsic motivation: this is what is done to motivate the individuals. 

Needs theory: Maslow(1954) states that the human being have five different needs. When the lower need is pleased we aim for the higher need.
The fundamental factors are: physiological, safety, social, esteems, and the highest one is self actualization.

II. Introduction


According to nationalency klopedin (2015): reward is “either money or honor that pays out as a compensation , normally as a sign of appreciation or achievement ”

The purpose of the reward system is to contribute to the increased value of an organization and to motivate employees and encourage actions that are needed for a company’s success.
For the worker, the reward needs to be better than other options, and for the organization the employees action must be better than the reward (nelson & ovle 2013). Since every organization is different the reward system should be adapted to the specific organization (Wilson,2013).

Baron 1983 says that motivation is an important part of rewards and has an impact of  behavior to achieve some goals .There are 2 types of rewards: intrinsic or extrinsic .Extrinsic rewards (tangible rewards) does not include any task related to the work of employees, and may be according to salary, higher payments and benefits. Intrinsic rewards (intangible or psychological rewards) such as motivation, behaviors, and satisfaction. 

According to Luthans (2000), there are two basic types of rewards, Monitary and non- Monitary and both can be used to enhance employees performance behaviors . Financial rewards mean pay for employee performance such as career advancement , performance bonuses, job promotions, commissions, tips and gifts etc.. Non financial rewards are non monetary or morally such as acknowledgement, certificate, and genuine appreciation. 

The employee could leave the company when he feels uncomfortable in the work environment , some factors are : low salary ,lack of advancement, de-motivated  (coff 1997), these problems leads to  decrease in a company’s productivity .The role of management is to keep employees and offer the needs when they feel uncomfortable or underpaid at the work. 

Research questions: 

1- What type of reward system they use at Blom bank?
2- Do reward systems motivate the employees?
3- How can Blom bank make their reward system more sufficient?

III. Company profile:


BLOM BANK started operating in 1951 in Beirut. Its establishment coincided with a booming period in the banking sector in Lebanon. By 1953, BLOM BANK started expanding and opened a branch in Jeddah, KSA. As the Lebanese Civil War broke out, BLOM BANK’s operations abroad increased to cater for the need of the Lebanese diaspora. Today, BLOM BANK is present in 12 countries across the world. On the leadership level, Dr. Naaman Azhari became the General Manager of the Bank in 1962 and Chairman of the Board and General Manager in 1971. In 2008, Dr. Naaman Azhari was appointed Chairman of BLOM BANK GROUP while his son, Mr. Saad Azhari, became Chairman of the Board and General Manager of BLOM BANK5 and also serves as Vice-President of the Association of Banks in Lebanon.6
It changed its name to BLOM Bank in 2000.7 It acquired the Lebanese subsidiary of HSBC Bank Middle East, to be approved by the Banque du Liban.8
As of 2016, it was “Lebanon’s second-largest bank by market capitalisation.”8
Every BLOM bank employee is rewarded for his work with fair compensation ,career advancements , lots of benefits and opportunities for skills and career development. Furthermore, the management monthly chooses the employee of the month who has proved service excellence in his department. 
In addition , all employees are treated with respect in a culture built on fairness, ethics and transparency. BLOM bank prevents any type of discrimination and offers equal opportunities to the employees without considering their religion, age or disability… For example ,the percentage of employees gender is almost equal with 53% males and 47% of females .

IV. Problem Identification:

In this problem analysis, several of the problems that arise in the use of reward systems will be addressed .it is important to keep in mind that reward system are somewhat subjective and what is conceived as a reward may differ from one person to another. A person might think that a pat on the back or a little bit of acknowledgement is sufficient while another person may only want reward in the form of financial compensation. Another problem is that those who don’t get reward get indirectly punished these can lead employees to perform worse, and rewards not linked into an employee’s performance or a rewards not linked to the job to be performed

V. Subject-relevance and Added-value:

All BLOM bank employees and are medically covered via NSSF and AROPE insurace that covers sickness ,maternity and end of service indemnity Insurance and many more services free of charge. 
There are lots of other benefits listed by BLOM bank website ,and we will cover part of them :

1- Dental plan : all employees are eligible to benefit from dental plan that covers dental expenses of an advance loan with 0 % interest.
2- Conversion privilege option:  this allow employees to convert their term insurance policy to a permanent policy after retirement ,and that will allow them and their spouse (if applicable) insurance for the rest of their lives .This option is intended to protect the employees from being declined insurance based on a change in health status.
3- Profit sharing: employees can be entitled to profit sharing and marketing bonuses depending on their participation in marketing activities and the volume(quantity) of sales achieved. Profits are distributed quarterly (every 3 months).
4- Salary increase and annual bonus: employees can benefit from salary increases and bonuses depending on their annual performance evaluation . 

SOCIAL ACTIVITIES ENGAGEMENT: being a large company and having over 2,000 employees in Lebanon alone and focusing on the well-being of its employees, encourages them to participate in a variety of social activities such as: BLOM Basketball Team (Males-females) , BLOM Football Team,  the bank’s musical talents unite to create oriental and acoustic melodies. These activities leads to create a better teamwork spirit at work.

         SAFETY AND SECURITY FIRST: Being a big company and having many branches locally and internationally ,the company should stick to its values about bringing safety and security to stakeholders, at both external and internal levels, the management department has developed a  program which aims to reinforce the fraud policy and the code of conduct. The main purpose of the program is to ensure that every employee can be able to report his concerns (violations, fraud, abuse, discrimination, harassment…) to an independent authority from his supervisor. The main objectives of the program are: Demonstrate management’s non-tolerance attitude,  identify and resolve issues early to have the time to fix them  ,provide a risk-free way to voice concerns. Furthermore, it is the company duty to keep raising its employees awareness on security threats. So as a big company ,the Bank organizes Information Security Awareness Campaigns to address and prevent security threats .
-Events: The HR department  is always actively participating and hosting many recruitment events, in coordination with BLOM shabeb (such as job fairs, career fairs, workshops, orientation programs, etc…), the department also participates in many extracurricular activities such as marathons and sports championship.

VI. Proposed Solution(s):

When deciding what forms of rewards to use, an organization has to consider the company specific situation. Whether motivation needs to be improved, if there is tough competition for employees, whether competencies are being retained within the company and the form of ownership are questions that will have to be answered prior to the design (Arvidsson 2008).

  MEASUREMENTS In the creation of reward systems a fundamental challenge is to determine what to base rewards on and how to measure it. Simply stated If you want corn, plant corn. (Knight, webpage, 2013-03-30) Different organizations, depending on their specific industry, strategic focus and characteristics, will need to use different ratios and metrics. Every organization must work actively with trying to identify the specific metrics and ratios that reflect the factors of vital importance for their organization’s success, commonly referred to as KPIs. If an organization whose organizational culture encourages results, metrics and ratios will play a vital role in terms of basis for rewards. The ratios should, according to Catasús et al. (2008), be a tool in order to control, learn, mobilize or reward an organization, team or individual. Further, it is important that the ratios used are limited in numbers, easily understandable and possible to measure (Catasús et al. 2008).

 we think that the bank has a better opportunity to make their reward system more effective by investigate more in which individual motivates by which factor because rewards can differ from one person to another, surveys and interviews can be a solution. If most of the employees selected non-financial reward then it is an advantage to use because non-financial rewards are more profitable for the bank.


VII. Conclusion, Summary, and Recommendations:

In order to ensure effectiveness of an organization it is required that workers are motivated and this can be facilitated by the help of reward system. Rewards can help individuals to perform better and it also promotes motivation and satisfaction. It may also be a good way to retain important workers in the organization and the reward can also get the employee to feel important and needed.
If good performances in the organization is rewarded it is will most likely happen again(Nilsson& ovle2013).

Companies that choose to reward employees perform better than companies that do not use any reward system.

Here are a few things to keep in mind as you design your reward system: 

1- Get employees involved with designing your reward system
2- Tie rewards to company goals
3- Be specific and consistent 
4- Reward behaviors
5- Reward teams

According to Rahman& hoque(2014)there are five job dimensions that are very important for an employee to feel motivated and satisfied in their work place. These are the work itself, pay, promotion, opportunities, supervision and co-employees.

We have come to the Conclusion that Blom bank uses several different types of reward system to motivate their employees, the main and most effective ones are the financial, in the form of bonuses and increased salary, if the bank want their employees to be more effective, maybe shares can be part of the financial rewards.