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Di Cieri (2005) Says that “Trait based method is all about focusing on the personal characteristics of an individual employee”. Personal characteristics here include assessment of employee behaviour, what a person is. It doesn’t matter what they actually do. In result based method the comparison of employees actual work outcome is done with predetermined targets or objectives . Here objectives are which fixed before starting of any work. This method focus mainly on what employee does and achieve in his work. Behaviour based method is one which focus on the employees competencies, skills and behaviours in performing a job .

Performance measurement is essential here . Advantages of using result based method are, it motivates employees to work hard and to give their best, motivate individuals to achieve specific results that are aligned to the business strategy, motivates those employees to work hard who think what’s a need of doing hard work when my place is safe in company, it helps at the time of giving promotion to the employees because it shows the ability of employees to work, it provides a target to employees which every time tell them that where they have to reach and what there target is, it give birth to the feeling of competition between employees.

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Disadvantages of result based method are; it put an extra pressure on employees or work load,sometime it effect their personal life also, in quest of achieving targets sometime they get into depression stage, the fear of loosing job is always in the mind of employee which make them uneasy every time not only in office but also at home, sometime too much competency feeling between employees take form of personal rivalry which is really bad for a company.

Ashton(1996) argues that result based remuneration strategy if applied in a company has a power to change the performance of company because it brings a lot of commitment in working class people of that company. Poels (1997) argues that competencies an employee demonstrates and the potential he possesses become more and more important and consequently deserve more reward then a person giving no results.

In contrast, Kohn (2000) argues that result based method can be bad for business because firstly it encourage people to focus narrowly on a task, to do it as quickly as possible, and to take few risks, secondly extrinsic rewards can erode intrinsic interest, thirdly people come to see them selves as being controlled by a reward. Remuneration strategy of McDonald’s is different for employees and managers. For managers it is solely based on results but for employees it is behaviour based. The reason behind company performance is this only they pay high packages to management employees so that they can give their best and help company to grow.

The employees at top management are responsible for every result they generate. It is the intention of this paragraph to critically analyse how short term monetary remuneration strategies are used to reward managers and employees in the achievement of pre determined performance targets. McDonalds should apply remuneration strategy linked to performance and it must be only for managerial level not for the lower level. Di cieri (2005) says that “Under short term monetary remuneration strategy the things which comes under it are bonuses, paid holidays and travel, commission, paid time off’s, awards and paid cost”.

These are given to appreciate the efforts of employees at the spot. Advantages of using short term monetary remuneration strategy are like this first it motivates employees to work hard because they know if they will give good results company will instantly give them reward ,no waiting long, give results and take prize of that. Second apart from basic pay bonuses, commission etc. give a chance to employee to earn some extra. Thirdly it eliminates the feeling of some employees who think, why they should work hard when everyone has to get a same pay.

Fourthly it helps management to differentiate between efficient employees and non efficient employees which help at the time of promotion. Fifthly company can judge the calibre and mentality of every employee by seeing the impact of bonuses on employee performance. Disadvantages are, first, some time it makes employees lazy when there are no bonuses or commissions. Secondly, if the rates of bonuses are not fixed then it can be a problem. Thirdly, sometime the actual performance of employees turns into greed of more money. Fourthly; sometime it eliminates the feeling of team sprit because every one works for its bonuses and commissions.

Millard (2006) argues that Merit based bonuses are not gift bonuses which are handed out firm wide, they are purely tied to performance, this may be a reward for client development or simply long hours. White (2006) argues that Bonuses can help employers manage costs and are “very effective around creating focus” on business objectives. In contrast Guggenheim(2006) argues that sometime they create problem when rates are not fixed because you don’t know if what you are getting is comparable or not. Here McDonalds’ provide incentive pay, vacations, holidays and leave of absence to their employees.

Bonuses and commissions to managerial level employees. It is the intention of this paragraph to critically analyse how long term monetary remuneration strategies are used to reward managers and employees in the achievement of pre determined performance targets. McDonalds should apply remuneration strategy linked to performance and it must be for both managerial level and for the lower level. Di cieri(2005) says that long term monetary remuneration strategy cover things like share ownership, profit sharing , long term bonuses ,medical insurance e. tc.

This must be done because this will motivate lower level to work hard and to tell them their importance for the company. Benifits( long term monetary) like credit unions ,retirement plans, financial counselling. Rewards like long term bonuses make employee more loyal to the company . If McDonalds’ will implement it, it will increase the profits of company. Weitzman and Kruse (1990) argues that the aim for adopting broad-based incentive plans such as profit sharing is to induce employees to work toward increasing a firms earnings ,thus indirectly substituting for other employee behaviour mechanisms.

Wagner et al. (1988)argues that a firms long term performance is improved by the use of accounting based incentive plans. Bradley and Estrin(1992) argues that profit sharing may enhance a firms productivity as it encourages information sharing and makes the firm flexible in responding to environmental changes. In contrast, Wadhawani and Wall, (1990) argues that profit sharing adoption does not positively influence a firm’s stock market performance. or its earnings productivity, since gains from profit sharing adoption are cancelled out by increased labour costs.

Qones et al (1997) argues that the available econometric evidence does not clearly identify under what conditions profit-sharing would be expected to offer large productivity gains or the channels through which these gains might arise. McDonald’s give long term monetary rewards and incentives to both of their managers and employee, but some of incentives and rewards are not for employees those are solely for managers like long term bonus and profit sharing . Here company differentiate what benefits are for employees and what for managers. The company is successful in applying this method effectively in use.

It is the intention of this paragraph to critically analyse how short term non monetary remuneration strategies are used to reward managers and employees in the achievement of pre determined performance targets. McDonalds should apply remuneration strategy linked to performance and it must be for both managerial level and for the lower level. Short term non-monetary benefits and rewards are employee of the month, awards and recognition, recognition in the organisational newsletter, dinner for two and mystery flights paid by the organization.

In employee of the month company select one best employee from the whole working class and give him the honour of the best employee. By the use of organisational newsletter company can inform the whole working class about their performance and who is performing well this generates the feeling of competitiveness in employees. Performance gifts like dinner for two can give employee to make a night special with his family enjoying his achievements.

Ballentine et al,(2003)argues that while cash or monetary incentive constitute the primary motivation, which is essential to fulfil the needs and wants of workforce one can’t forget the significance of non monetary rewards to motivate and influence employee performance. Di cieri(2005) says that non-monetary rewards are assuming greater significance in the present tight economic scenario, characterized by limited budgets for performance bonuses and incentives. Short term non-monetary incentives and rewards offer employee autonomy and personal recognition and include pleasant work environment, mementos, trophies etc.

Advantages of this type of strategy are they meet the employees internal needs such as recognition , self esteem and fulfilment, thus influencing employee motivation. Kepner (2001) argues that, the advantages of short term non-monetary rewards are, first one Memory value which last longer in case of non-monetary rewards in comparison with that of cash, which last when cash is spent. Second is Trophy value which can be displayed to co-workers and friends as a trophy given in appreciation of good work. Third is less expensive in comparison to cash.

Disadvantages of this are, if non-monetary rewards are not mixed properly with monetary rewards it can de-motivate employees. Second is an employer some time use them frequently by which it loses their importance so they must be given in some special performance. McDonald’s use matching gift programs, vision supplement programs, dental etc to their employees at lower and management level both . They use this very effectively at both level and they are getting good results in term of employee satisfaction and motivation.

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