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paid to each employee and what form should that payment take?

There is nevertheless a large choice of payment systems and methods available for management to choose from and many methods of determining pay levels available for manages to choose from. However, Taylor (2000) as cited in Thorpe and Homan (2000, p: 12) states 'the principal determining factor when deciding on rewards for employees of the organization are the objectives the organization has for their HR policies and reward systems in particular'.

In the context of the studies Armstrong and Lybrand (1992, p. 41) states that reward strategy is concerned with: - developing a positive, performance orientated culture; underpinning the organisation's values, especially those relating to excellence, innovation, performance, teamwork and quality; conveying a message to prospective high-calibre employees that the organisation will satisfy their reward expectations; ensuring that the right mix and level of reward are provided inline with the employees and the environment in which the business operates; linking reward policies, systems and procedures to the key business and human resources strategies for innovations, growth development and the pursuit of excellence; also developing a strong orientation toward levels of performance throughout the organisation by recognising successful performance and increase in levels of competence, thus contributing to the processes of empowering, enabling and energising all employees; and indicating to existing employees what types of behaviour will be rewarded and how this will be place, thus increasing motivation and commitment and improving performance.

In the same vein, Armstrong (2001) also states in order for organisations to achieve their strategic objectives it must have a skilled, competent, committed and well motivated workforce which is supported by a reward strategy that: - flows from and fit's the business strategy; links reward to performance; aligns individual and organisational competencies; integrates with other human resources management and development strategies; and evolves from consultation with key stakeholders.

A useful way of conceptualizing different reward philosophies is provided by Rajan (1997: 75). Figure 2.2 shows how reward can be categorized along two dimensions, identifying rewards that are money-related and non money-related; and rewards that are group-related (available to all or most staff) or individual-related. Thus Rajan (1997) argues that there are four types of approach to reward.

1) Types of reward

Group-related

2) Security -driven Tradition-driven

Lifetime jobs
Cost of living increases
Corporate prestige a€￠Perks
Non-money-related Money-related
3) Employability-driven: Contribution-driven

Training and development
Performance-related pay
Personal career plans
Merit bonus
Individual-related
Source: Rajan (1997: 75). Reproduced with the permission of Eclipse Group Limited cited in Beardwell, and Holden, (2001), Human Resources Management, A Contemporary Approach, Third Edition, Pearson Educational Limited p. 511

Types of reward are important in terms of motivation where by different types of reward may motivate an individual; the diagram above illustrates this by highlighting different elements. Motivat