An Organization exists within a wider environment that affects its structure and often shapes it. Such Organizations compromise of individuals working for different needs and expectations. The relationship of individuals is often characterized by discord and conflicts between the management and employees which represent the organization and the individual workers. (Sarah and Steve, 2012) The conflict is often left in the hands of Human Resource Management, who have main objective to manage people and their relationships within the organization.
Employee compensation policies often cause such conflicts within the organization. One such example is the employee stock ownership that involves the taking up of company’s shares by employees. Management of an organization use the strategy to promote employee’s loyalty to the company, and that may lead to improved performance. The option also offers employees the potential for significant financial rewards. (Travis and Nathan, 2001) Initially, the Stock options have little or no risk for the employee. However, the employee risks losing money in the case the value of the stock decline in the market. In such a case, the employee might be forced to take up another job or work longer hours to make up for income lost. This creates conflict especially when the employee has no option and the company’s equity structure is unstable. The employees may feel that they have no control over the share price, affecting morale and retention.
Organizations have turned to Human Resource Management to find the best way to organize its workforce. The HRM is placed in a critical position since the people in the posts of HR are employed by the organization, thus they will be expected to develop systems that will improve the organization’s interest by making the best use of the existing manpower to promote the goals of the organization. In such cases, the management should consider issuing performance shares at the beginning of the performance period to motivate the employees while promoting the organization’s objectives. This may be seen in the growing use of high-performance working practices.
References
Sarah Gilmore and Steve Williams (2012) Human Resource Management Oxford University Press.
Travis L. Knapp and Nathan L. Reneau (2001) Understanding Employee Stock Options, Rule 144 & Concentrated Stock Position Strategies iUniverse.
If you need a similar paper you can place your order from custom nursing essay writing services.
