Strategic reward management is about planning and giving rewards in a way that supports a company’s main goals. These rewards can include things like cash bonuses, recognition programs, or other benefits. The key is to make sure the rewards match the company’s values and help achieve its objectives.
This kind of reward management is very important for any business. If employees don’t feel properly rewarded for their work, they may become unhappy and look for jobs elsewhere. But when rewards are given in a smart and fair way, employees feel valued and are more likely to work hard and stay committed.
Table of Contents
Learning Outcome 1 Understand effective reward strategies and policy frameworks.
Question 1
AC 1.4 Critically evaluate the effectiveness of the organisation’s reward strategy recommending how this might be revised to more effectively attract and retain employees.
Introduction
Apple Inc. is a leading, innovative and very valuable technology company in the world that is known for its innovative products and special corporate culture (Podolny and Hansen, 2020). To effectively keep its competitive edge, Apple distinctly implements a comprehensive rewarded plan geared to ensure attraction and retention of top talent. This strategy encompasses financial incentives, stock options, career development opportunities, and an inclusive workplace culture (Accelingo, 2024). However, while its current reward system works well to achieve employee satisfaction, there are challenges with aligning satisfaction with retention. The report takes a critical view at Apple’s reward strategy, evaluating its strengths and weaknesses, and the recommendations to improve its capability to attract as well as retain employees.
Critical Analysis of Apple’s Reward Strategy
Apple’s reward strategy depends mainly on combinations of both direct financial incentives, long-term compensation, and nonmonetary benefits (RORG, 2025). Under the company’s compensation model, competitive salaries, performance based bonuses as well as stock options through Apple Stock Purchase Plan (ASPP) are offered to employees to ensure their interests align with the success of the company (The Human Capital Hub, 2024). In addition, Apple gives additional benefits such as health insurance, wellness programs, tuition reimbursement, and employee discounts, which enhance job satisfaction and engagement.
A major strength of Apple’s reward strategy is that it relies on stock options and restricted stock units (RSUs) to retain employees (Bruce Brumberg, 2022). One of the positive aspects of this is that it helps employees feel a sense of ownership and commitment toward the products as well as long term financial security. In addition, Apple’s brand prestige and its culture of innovation stimulate intrinsic motivation of employees and hence tend to emotionally connect with the company’s mission and vision (Podolny and Hansen, 2020b). In addition, Apple has created a brand of offering learning and development opportunities that allows employees to excel professionally in the organisation and the industry.
Nevertheless, Apple’s reward strategy has some limitations. A major criticism is that corporate and retail employees are not treated equally (Nho Quyet Tran and Dan, 2022). Corporate employees, meanwhile, have high compensation and benefits including stock but retail store workers often enjoy salary and promotions that are slim, together with great levels of work stress. Not only are there concerns surrounding the demanding nature of the work environment, the limited work–life balance and that there is no upward mobility within the organization, but many retail employees have voiced their concerns (Ayesha Madhumali Dassanayake and Sanoon Fathima Fasana, 2019). As a result, Apple’s retention strategy can easily lose out to these high turnover rates among retail employees.
Within Apple’s corporate divisions, the high-pressure work culture is also another area of concern (Ganesh, 2024). While the company gets the best of top talent, the gruelling workdays can result in burnout and employee dissatisfaction. Long working hours and a staff burden are often reported by employees, which may kill morale and enthusiasm with time. In addition, performance based incentives used by Apple can be too competitive, where there is no inhibition on collaboration or teamwork (Shu, 2023). While fostering secrecy and internal competition would help the agency achieve innovation, they could have a negative impact on employee satisfaction and well-being in the long term.
Additionally, Apple’s reward strategy has been questioned for its success in attracting and retaining the diverse talent that it needs (Nho Quyet Tran and Dan, 2022). Despite these advances, some employees, external observers argue, DEI efforts at Apple have not gone far enough to ensure equitable compensation. According to reports, there are also pay and gender gaps within Apple, suggesting that Apple’s reward strategy may need to be refined for fairness and inclusivity (Li and Qiao, 2023).
Recommendations for Improvement
In order to be successful in attracting and keeping its employees, Apple should think about balancing and including its reward strategy so as to narrow down existing gaps. One important recommendation is to enhance retail employees’ compensation and career development opportunities (Half, 2023). To make retail employees perceive themselves as valued and motivated to stay within the company, Apple can offer its employees higher base salaries, performance based pay incentives and clear promotion pathways.
Apple should also address employees’ concerns of wellness in their work as that entails addressing the issue of healthy work-life balance (Apple, 2022). Option for remote work and additional paid leave would allow employers to give their employees and thus their job satisfaction and burnout would decrease dramatically. And by offering wellness programs specific to corporate and retail employees via mental health counselling and stress management, retention of employees can be improved even more.
On the other hand Apple could improve its approach with regards to the performance based rewards. Stock options and bonuses are effective ways to reward high performance but not team work and collaboration and therefore Apple should also consider alternative reward systems (Podolny and Hansen, 2020b). Introducing group based incentives and peer recognition program may create more supportive work environment and make employees want to work towards collective goals instead of just focusing on their own performance.
In addition, Apple should be proactive in guaranteeing equity for compensation between all employee demographics. Conducting pay audits on a routine basis and having open policies of remuneration would eradicate any disparity in gender and racial wages (Johnson, 2023). If Apple has a more inclusive approach to rewards, it can bolster its employer brand and hire more diverse talent pool.
Lastly, Apple should further take into consideration DEI in its reward strategy. Mentorship and leadership development programs focusing on diverse workers would improve the inclusion of a wider range of employees and prevent them from leaving (Tiao, 2024). Furthermore, if all the employees are made to have equal access to the career growth opportunities irrespective of the department they are working in or their background, it would help create a fairer and a more motivating working environment.
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