Evaluating Reward Systems

Introduction

"Rue" comes from the French word for "street," while "21" represents the age that everyone wants to be! (rue21, 2011) Formerly known as Pennsylvania Fashions Inc., rue21 has been a leading specialty retailer establishment offering the newest fashion for girls and guys. Rue 21 Inc., is headquartered in Warrendale, Pennsylvania, they specialize in offering discounted casual apparel and accessories for young men and women. In February 2002, Pennsylvania Fashions filed for chapter 11 bankruptcy protection, which they eventually revamped themselves closing nearly 80 out of the 250 stores during that time. In May of 2003 the company exited chapter 11 bankruptcy and changed the name of the company in efforts to help revamp the outdated image. Rue 21, Inc. is now a leading multi-billion dollar retail establishment, who just in the past 5 years has decided to venture into the fragrance aspect of the business. Rue's mission now is to introduce two new fragrances every year, the company receives 7% for every bottle sold, so the company view the fragrance portion of the business as a huge investment.

Being an Assistant Manager my job is to make sure that the associates carry out their assign duties for that particular day. Maintaining exceptional customer service, while providing good floor supervision is a job in itself. Mainly, the job requires that store performance is up on the sales plan, outperforming last year's sales, making sure great customer service is front and forward every business day, and lastly that the store's fragrance goal is met every day. Rue 21 knew that they were entering into a huge competitive market, especially, trying to sell fragrance that would be appealing to young and older adults. More and more it has become extremely hard to sell fragrances to the customers, because majority of the shoppers are repeat shoppers and has increasingly grown annoyed with being ask to purchase a fragrance.

Associates have started to complain about how they view the company as being unappreciative of the way they try to exceed the company's goal on selling fragrance. The company doesn't really offer any types of incentives that will motivate managers and staff to promote selling fragrances in the store.

Problem Statement

Rue 21 doesn't have a system that reward associates and managers that sell a lot of fragrances in the stores. How can Rue 21 develop a reward system that would appease their fellow workers? Associates eagerness to sell fragrance has dwindled tremendously since the company has put more emphasis on promoting and maintaining a high percentage. Recently, the company has started to host conference calls trying to give stores with low percentages tips on how to sell fragrances.

Rue 21 requires that at least 3% of daily sales be contribute to fragrances being sold. The managers are required to set a tentative fragrance goal at the start of each business day; the goal is set according to what the sales plan is for any particular day. The key to the whole equation is to maintain the percentage for the entire day, you may have an awesome day when it comes to meeting the fragrances goal for that day, but if you are extremely busy sales will driven up which causes the fragrance percentage to drop.

Increasingly, associates have voice their opinion about how much rewarding it would be to have some type of incentive when you a huge amount of fragrances on a given day. Many companies have come up with some type of reward system to motivate their workers to outperform each, which in terms drive their business sales.

Recently, our store has had to join several of critical conference calls, for producing low fragrance percentages. Being reminded of how poorly you are performing on producing fragrance sales would put a damper in any hard working associates' mood. Over the past seven weeks in this course, we've learned that job satisfaction is a high priority when expected to produce great job performances. The company looks at the lack of fragrance sold as the managers and associates not living up to their job duties. Ultimately, not performing all of your require job duties could affect your chances at any advancement or raises in the near future.

Everyone once and a while employees like to feel like they are appreciated at their workplace, so the lack of incentives offered at Rue only makes the associates perform to the bare minimum in concerns with suggesting fragrance to every single customer that walks into the establishment.

Literature Review

The Field Report

"Happy Campers"

Job satisfaction, is it the most important aspect in a employee's decision to stay employed at a job? Well, apparently to U.S. workers survey in 2007, 47% say they are very satisfied with their jobs, and that's the most important factor for them. An annual survey is conducted by Design News, which for this particular survey focus on Design Engineers. Design News wanted to know why they like their job so much despite the rising unemployment, how unrealistic raises are, and the fact that corporate are downsizing. What Design News found out, which in my opinion, was most relevant to my research, was that problem solving, technical challenges, plus the opportunity to be creative was the driven factor as to why they would stay willingly and whole heartily at their chosen professions.

General happiness and job satisfaction positively go hand and hand. The thing to consider is that most workers spend a significant amount of time at work, which most people is an investment, so in turn for the investment they want to be satisfied with their work environment.

Management Forum

"Unique Incentives Foster Teamwork"

Now more than anything organizations and companies are enlisting teams to accomplish their goals of boosting productivity improving quality, and reducing to the customers waits. With that being said, many of the management concepts are to approach projects with teams. In recent years the team concepts have become increasingly popular, so the evaluation of didn't types of reward systems. There are intrinsic rewards related to teamwork, including: the satisfaction that comes from working with others to achieve a common goal, a greater sense of responsibility, increased organizational exposure, and freedom from bureaucratic restrictions. When properly designed and administered, the evaluation and reward system in a team environment can have a positive influence on employee performance. Ultimately, the performance-reward