Human Resources Management: Compensation Concept


Modern times require advanced practices and initiatives to empower employees. Maslow’s hierarchy of needs is a powerful framework that has been utilized in different companies to compensate and reward workers. Although some firms have recorded positive results, researchers have acknowledged that certain aspects make this model inadequate for empowering employees during the 21st century. The concept of compensation and benefits can, therefore, be redefined in such a way that it captures different practices that can result in employee motivation. This paper uses latest research studies and findings in order to explain why this new definition is necessary for managers and HR practitioners.

Introduction Part

Human resources management (HRM) focuses on various initiatives such as employee motivation, remunerations, and compensations. Over the years, the concept of “compensation and benefits (C&B)” has focused on monetary rewards. This means that many HR managers continue to use specific approaches such as salary increments to empower and make their employees more productive. Some even offer remunerations depending on the effectiveness and performance of the targeted workers. Companies that rely on these traditional practices have been found to take longer before realizing their aims. In the recent past, corporations such as Google have managed to implement and use various initiatives to empower their employees.

The changing global environment is also encouraging entrepreneurs and business leaders to focus on superior models that have the potential to improve business performance. Some of the leading catalysts of this development include modern technologies, the Internet, and globalization. Unfortunately, many organizational leaders have realized that most of the existing models are no longer competitive or applicable in the modern business environment. These issues explain why a new study is needed to analyze the challenges facing many HR managers whenever empowering, guiding, and supporting their employees or followers. Specifically, this paper seeks to come up with a new theoretical argument for implementing the concept of compensation and benefits in different working environments.

Research Questions

This paper seeks to expand the C&B concept to streamline HR operations and improve organizational performance. These questions will be answered in this study:

  1. How can HR managers redefine the C&B concept to maximize employee performance?
  2. How can the redefinition of C&B transform the HR model and organizational culture?

The proposed topic seeks to offer meaningful and evidence-based insights to transform HR practices. Companies that embrace these new concepts will achieve their potential.


The information presented in this document is relevant since it seeks to expand an idea that has been studied shallowly over the past few years. Ukil (2016) indicates that business organizations utilize diverse methods to empower and guide their employees in order to deliver positive results. This practice is informed by various attributes such as a company’s business model, number of workers, anticipated objectives, competition, and the expectations of different customers. However, most of the initiatives employed to hearten individuals appear to converge. This is the case because most of the theoretical arguments applied by HR managers revolve around the use of rewards, salary increments, and better working conditions (Shahrawat & Shawrawat, 2017).

Although the implementation or introduction of these aspects is something that has transformed many workplaces, studies have revealed that the maximum potential of employees is yet to be unearthed or realized. The most appropriate strategy that can empower and make it easier for workers to transform their units and deliver positive organizational results should, therefore, be informed by every change experienced in the world today (Ukil, 2016). This paper uses existing literature to explain why a new definition of compensation and benefits within the working environment can address numerous obstacles and make it easier for more workers to deliver high-quality results. The approach can address the challenges facing HR managers and eventually deliver positive results. The reader will acquire useful information and insights regarding the issue of employee empowerment and how it can be used to improve organizational efficiency and profitability.

Theoretical Foundation

Theoretical Concepts

Since employees complete numerous duties and roles that support an organization’s performance, it is necessary for business owners and entrepreneurs to reward them accordingly. More often than not, workers are entitled to wages or salaries depending on the established employment terms and conditions (Shahrawat & Shawrawat, 2017). These remunerations are available to individuals for the tasks completed are goals achieved. Within the past five decades, employers have been keen to offer nonfinancial rewards or benefits to their workers as a way of appreciating their contributions and efforts (Ukil, 2016). Many HR managers have been focusing on various models and theories in an attempt to support and make their employees more productive or beneficial to the targeted company. Consequently, various models (or theories) have emerged to redefine the way workers can be compensated and empowered (Shahrawat & Shawrawat, 2017). Different companies have been focusing on such attributes and concepts in an attempt to improve performance and remain competitive in their respective industries.

Maslow’s hierarchy of needs stands out as one of the most powerful theories that describe how managers can empower their followers and guide them to achieve their potential (Shahrawat & Shawrawat, 2017). Ukil (2016) argues that empowered workers maximize their efforts, address emerging problems, and implement powerful models to deliver results within the specific period. Additionally, the concept of organizational theory indicates that leaders must address employees’ needs, implement superior models, and use adequate managerial strategies to improve performance (Choi, Goh, Adam, & Tan, 2016).

HR professionals translate this tool into a model for motivating and compensating workers. The first attribute described in Maslow’s theory is physiological needs (Choi et al., 2016). HR managers use this aspect to offer regular wages or salaries, essential facilities and equipment, and desirable working space. Every safety need described in the model is used to support the provision of benefits such as insurance coverage for medical needs and pension schemes (Kuranchie-Mensah & Amponsah-Tawiah, 2016). Social needs are embraced to promote teamwork and guide employee to engage in various activities that have the potential to address their demands. The fourth aspect outlined in Maslow’s hierarchy of needs theory is that of self-esteem (Shahrawat & Shawrawat, 2017). More often than not, managers focus on this attribute to celebrate workers’ performance or achievements. The final concept is that of self-actualization (Choi et al., 2016). Companies with appropriate HR policies implement various initiatives such as mentorship and training to meet this demand. Some firms put in place adequate measures to empower employees to achieve their career goals.

From the above analysis, it is evident that Maslow’s theoretical tool can make a significant difference in every organization’s HR practice. This model also presents adequate procedures and action plans that resonate with various workers’ demands. According to Shahrawat and Shawrawat (2017), the most appropriate thing is for leaders to be aware of every emerging need and address it using evidence-based measures. Unfortunately, the introduction and implementation of this theory in different organizations is something that has not improved the confidence of different scholars and skeptics (Ukil, 2016). This happens to be the case because many firms embracing the power of this model have not recorded positive results. Without such incentives in place, the number of employees who quit and look for new jobs has continued to swell. This problem has attracted the attention of different scholars and researchers in an attempt to revolutionize HR practices and make it easier for more companies to achieve their potential.

In the recent past, many companies and HR managers have embraced the power of the reinforcement and expectancy theory (RET) to compensate their workers for their timeless efforts and dedications (Ukil, 2016). Shahrawat and Shawrawat (2017) indicate that this framework is based on the notion that a desirable behavior that is rewarded has higher chances of being repeated. For instance, an employee who has been acknowledged for achieving a given goal or outcome will be willing to deliver superior results for his or her company. The provision of rewards can make positive behaviors and actions an integral part of a business organization. It is also notable the application of this framework can address most of the issues associated with Maslow’s hierarchy of needs (Zameer, Ali, Nisar, & Amir, 2014). This is the case because employees who deliver positive outcomes in a given organization will be rewarded in order to continue promoting desirable practices.

The integration of these theories can result in a superior model or framework for redefining the idea of employee compensation (Choi et al., 2016). This move has the potential to improve the existing relationship between workers and employees. The development will eventually transform the performance of a given company. The expansion of the C&B concept is, therefore, something that can introduce superior practices, new organizational cultures, and leadership approaches to empower employees (Zameer et al., 2014). Such assumptions will support the paper and guide different HR managers to improve their leadership philosophies.

Review of Sources

Aslam, A., Ghaffar, A., Talha, T., & Mushtaq, H. (2015). Impact of compensation and reward on the performance of an organization: An empirical study on banking sector in Pakistan. European Journal of Business and Social Sciences, 4(8), 319-325.

The authors examine how effective reward systems and compensations can drive organizational performance. Using the case of the banking industry, the authors observed that the provision of competitive rewards and compensations made it easier for different workers to focus on the best results, thereby making their companies successful (Aslam, Ghaffar, Talha, & Mushtaq, 2015). These two concepts can be utilized to expand the C&B concept and implement it in different settings to maximize performance.

Choi, S. L., Goh, C. F., Adam, M. B., & Tan, O. K. (2016). Transformational leadership, empowerment, and job satisfaction: The mediating role of employee empowerment. Human Resources for Health, 14(73), 1-14. Web.

According to this article, any form of compensation is founded on effective leadership. HR managers can use adequate competencies and initiatives to guide and empower their followers. The use of appropriate incentives can make a significant difference and make a given organization successful or profitable. In this article, the authors acknowledge that transformational managerial practices are useful whenever empowering and supporting employees (Choi et al., 2016). Such insights can be utilized to develop the most appropriate C&B concept that has the potential to revolutionize organizational efficiency.

Hanaysha, H. (2016). Examining the effects of employee empowerment, teamwork, and employee training on organizational commitment. Procedia – Social and Behavioral Sciences, 229, 298-306. Web.

The information presented in this article explains how employee empowerment can be realized using training opportunities, commitment, leadership, and teamwork. These initiatives appear to resonate with the attributes described in Maslow’s theory. Training and empowerment can meet an employee’s self-actualization demands. Efficient leadership supports or addresses the social needs of an individual. Leaders who focus on these attributes can transform the way HR procedures are pursued and eventually improve organizational effectiveness (Hanaysha, 2016). This article, therefore, presents meaningful ideas and arguments that can make a difference in every unit or department. Such concepts will be borrowed to expand the definition of the term “compensation”.

Kumar, P. J., & Kumar, A. A. (2017). Employee empowerment – An empirical study. Global Journal of Management and Business Research: A Administration and Management, 17(4), 1-7.

This article focuses on the use of incentives, rewards, resources, and favorable working environments (Kumar & Kumar, 2017). Emerging changes in the world of business are influencing new practices that can meet the diverse needs of different employees. With many people becoming aware of their rights and expectations, HR managers will be required to focus on the best measures to create attractive working environments and offer benefits that can result in improved performance (Kumar & Kumar, 2017). This strategy will result in higher satisfaction levels in every organization and improve business performance. Such ideas will ensure that the targeted research paper contains adequate ideas for improving compensation practices.

Kuranchie-Mensah, E. B., & Amponsah-Tawiah, K. (2016). Employee motivation and work performance: A comparative study of mining companies in Ghana. Journal of Industrial Engineering and Management, 9(2), 255-309. Web.

Focusing on the significance of employee motivation in the Ghanaian mining industry, the authors revealed that effective practices led to positive outcomes. For instance, the provision of adequate resources and training programs made it possible for many workers to achieve their goals. The scholars also observed that the level of performance declined in companies whereby the concept of motivation was taken lightly. Entrepreneurs and business people should embrace these attributes in an attempt to empower their followers and eventually improve profitability (Kuranchie-Mensah & Amponsah-Tawiah, 2016). This article offers meaningful concepts and frameworks for implementing adequate strategies to motivate employees. Firms that make these aspects part of their HR models will be in a position to achieve positive results.

Liu, Y. (2015). The review of empowerment leadership. Open Journal of Business Management, 3, 476-482. Web.

The idea of leadership is something that has revolved around the provision of direction and resources in an attempt to support (and sustain) the productivity of different workers. This article goes further to expand the concept of management by introducing the notion of empowerment (Liu, 2015). The author indicates that empowerment leadership is a powerful model whereby managers use resources, ideas, training programs, and rewards to empower their employees. This concept focuses on a wide range of action plans that are aimed at addressing emerging challenges, motivating individuals, providing resources and tools, and offering incentives that can result in positive outcomes. These ideas can be used to support and expand the suggested argument in this research paper.

Roozitalab, A., & Majidi, M. (2017). Factors affecting on improvement employee empowerment (case study: Saipa Corporation). International Review, 1(1-2), 9-17.

Reduced employee morale, lack of resources, poor reward systems are some of the issues making it impossible for workers to perform optimally. In this article, the authors offer meaningful and applicable incentives that can be taken seriously by HR managers to empower their workers. Some of these practices include the use of adequate resources, remunerations, and proper leadership. The insights presented in this article will form the basis of the research paper by outlining the major issues surrounding ineffective employee empowerment (Roozitalab & Majidi, 2017). The application of such attributes and arguments can ensure that a new model for compensation is introduced in different working environments.

Shahrawat, A., & Shawrawat, R. (2017). Application of Maslow’s Hierarchy of needs in a historical context: Case studies of four prominent figures. Psychology, 8, 939-954. Web.

This article analyzes Maslow’s theory and offers meaningful insights for applying the model in different settings to empower employees. With the theory being adopted successfully in different organizations, chances are high that it can be expanded to improve productivity (Shahrawat & Shawrawat, 2017). When the model is applied efficiently by a HR leader, it will be possible for the targeted company to address the issues affecting its employees. The authors acknowledge that the workers will find it easier to deliver positive results and improve organizational performance. The arguments will be used to inform evidence-based employee empowerment and compensation practices.

Ukil, M. I. (2016). The impact of employee empowerment on employee satisfaction and service quality: Empirical evidence from financial enterprises in Bangladesh. Business: Theory and Practice, 17(2), 178-189. Web.

This article examines how employee empowerment influences service delivery. In companies providing services to different customers, it is appropriate to empower and meet the needs of every employee. This practice is crucial because it ensures that different individuals are willing to pursue the goals or objectives of the targeted company. According to this article, unmotivated workers are usually unable to pursue their goals (Ukil, 2016). This article offers meaningful insights for developing the research paper. Such insights can be used or applied in different working environments to improve performance and increase profitability.

Zameer, H., Ali, S., Nisar, W., & Amir, M. (2014). The impact of the motivation on the employee’s performance in beverage industry of Pakistan. International Journal of Academic Research in Accounting, Finance and Management Sciences, 4(1), 293-298. Web.

The outstanding argument in this article is that employee motivation is a powerful strategy for maximizing performance. Businesses that implement adequate measures to satisfy their workers will have increased chances of recording positive results. In this article, the concept of motivation revolves around the utilization of incentives, rewards, compensation packages, and cultural practices that can maximize performance (Zameer et al., 2014). The information will therefore be resourceful for developing the intended literature review and discussion sections for the research paper.


Maslow’s hierarchy of needs describes how managers should fulfill their employees’ desires. According to the theory, empowered workers acquire and expand their competencies in order to deliver positive organizational goals (Roozitalab & Majidi, 2017). The theory also encourages leaders to use benefits and compensations to empower their followers. This understanding has informed numerous concepts used to address employees’ needs and maximize performance.

In accordance with Maslow’s theory, HR managers who satisfy most of their followers’ demands will find it easier to record positive outcomes (Choi et al., 2016). Similarly, workers’ whose demands are taken into consideration will make superior decisions and engage in appropriate practices that can result in improved business performance (Roozitalab & Majidi, 2017). Ukil (2016) goes further to assert that HR professionals should focus on every desire or need outlined in Maslow’s theory. This practice is capable of creating a favorable environment for implementing new changes and ideas that can eventually result in increased productivity.

Roozitalab and Majidi (2017) indicate that new needs in a given organization or workplace can emerge. This is possible due to the transformations and changes experienced in the world today. HR managers should, therefore, be aware of this fact in order to develop a superior model for compensating and empowering their employees (Choi et al., 2016). For example, the emergence of challenges such as disagreements and violence in the workplace is something that must be addressed using this theory (Liu, 2015). This arguments show clearly that Maslow’s framework can be implemented in different settings to revolutionize organizational performance and address the needs of many workers.

From the above analysis, it is evident that the application of Maslow’s theory in a specific company can present various cons and pros. The first benefit is that the use of theory in organizations can transform the nature of organizational processes since different employees are empowered and guided to deliver positive results (Liu, 2015). When workers are empowered and compensated, they identify new practices and initiatives that can add value to their companies. Secondly, the model can be redesigned and applied in different working environments. HR managers can identify and analyze the issues existing in their firms and examine the unique attributes of this theory that can result in better performance (Ukil, 2016). Additionally, specific units or departments in a company can be supported differently using this model. The most important thing is for every HR leader to be aware of the diverse expectations and needs of different employees.

Thirdly, the theory can inform appropriate organizational leadership, decision-making, and problem-solving practices. Managers who rely on this theoretical framework can come up with superior philosophies to lead and empower their followers (Liu, 2015). The model offers powerful incentives for making superior decisions and addressing conflicts that can affect the overall effectiveness of teams or groups. With these attributes in place, organizational leaders can come up with the best frameworks to mentor, compensate, and motivate their employees (Choi et al., 2016). They can also go further to introduce new aspects such as cultural and structural changes in an attempt to maximize performance and profitability.

On the other hand, this model has various drawbacks that should be taken seriously by HR managers who plan to use it to compensate and reward their employees. The first disadvantage is that it is complex. This means that it might not result in self-actualization. It is also evident that some motivational and empowerment strategies outlined in the model cannot deliver meaningful results (Hanaysha, 2016). The second weakness is that this theory focuses on different levels of employees’ needs while the C&S concept mainly focuses on a wide range of approaches to empower workers.

From this discussion, it is noticeable that there are some unresolved issues regarding the application of Maslow’s model in different working environments. The first one is that the framework is rigid and focuses on specific aspects that can empower employees to function optimally in their departments. This means that it fails to support additional practices and attributes that have the potential to transform the nature of compensations and rewards (Liu, 2015). The second unresolved issue is that the theory treats organizations as hierarchical systems that should always be governed by policies and rules. Consequently, employees should accept every reward or compensation available to them (Kuranchie-Mensah & Amponsah-Tawiah, 2016). These unanswered concerns explain why the theory might not be applied efficiently in the field of HR to expand the C&B concept.

With this kind of information, it would be appropriate for HR managers to consider the importance of evidence-based initiatives and practices whenever focusing on the emerging needs of different workers. As more people continue to pursue diverse goals in life, chances are high that many firms will record increased employee turnover rates in the future. This is something catalyzed by emerging technologies and changes in the global business environment. Some employees have been observed to quit their jobs when their employers fail to provide adequate medical cover (Liu, 2015). The presence of a safe and healthy working environment is something that has been considered to capture the needs of persons with disabilities. Hanaysha (2016) asserts that many firms have been on the frontline to provide natural support to different employees with deformities. Additionally, emerging technologies are making the idea of teleworking a reality. This means that many employees are becoming aware of these developments and have considered them as critical aspects that have the potential to undermine or improve their efficiencies.

The issues described above have never been captured in earlier studies or findings. Towards the future, successful companies will be the ones that consider such events and changes and make them part of their HR goals (Kuranchie-Mensah & Amponsah-Tawiah, 2016). Firms that ignore them will have increased chances of becoming obsolete and loosing most of their productive workers. Ukil (2016) goes further to explain why aspects such as work-life balance, telecommuting, provision of adequate resources, introduction of modern technologies, leaves, and training programs should be considered and used as powerful tools for empowering employees.


The above discussion has supported the utilization of Maslow’s theory whenever planning to compensate and empower employees. This is something practical since the ultimate objective of every profit organization is to maximize shareholders’ value. This objective cannot be achieved using appropriate leadership and HR practices. However, the drawbacks associated with this framework explain why monetary compensations tend to disorient a wide range of employee empowerment strategies. This paper, therefore, proposes that new attributes and initiatives (such as work life balances, modern technologies, and training opportunities) should be considered to expand the C&B concept. The presented framework will empower many HR managers and make it easier for their followers to focus on the outlined goals. Emerging conflicts and challenges in the working environment will be addressed much faster and eventually maximize organizational performance.