Reward and Recognition System

This is a presentation developed from a previously submitted proposal to provide a reward and recognition system for AIG's claims processing employees. The system is intended to eliminate late claims-processing fees. Reward and Recognition System to Enable Organizational Change

American International Group (AIG) is suffering economic loss due to late-processed workers compensation claims. Late claims generate repeated, multiple fines. Since claims processed after 30 days are liable to a penalty equal to 10% to 20% of the bill, this adds up to a substantial financial loss that is completely preventable. Furthermore, the delay in payment to medical providers negatively impacts AIGÆs working relationship with them, eroding the quality of that relationship and thus creating additional ôdragö on the bill-paying process.

An integrated reward and recognition system is the key to mitigating the financial penalties AIG is encountering due to late claims processing. The system is designed to provide both rewards (tangible benefits) and recognition (praise) to employees who demonstrate the timeliness and accuracy required to achieve the pay-on-time goal. This strategy will provide a number of peripheral benefits as well; it will raise employee awareness of the problem, improve compliance with the 30-day limit, reduce turnaround time in reviewing and paying bills,

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lly result in negative feelings such as jealousy and resentment. And finally, to be effective, rewards must be given frequently. Few people can sustain motivation all year long for an award they might get at the end of the year, but most people will remain motivated if fresh opportunities for reward are available every month. Internal analysis at AIG revealed that claims adjusters have a heavy workload, long hours, and numerous responsibilities, yet the salary range for WorkerÆs Compensation Claims Adjusters in Georgia starts at only $30,000. It was evident that one of the demotivating factors involved in AIGÆs claims processing problem might be undercompensation. Therefore, AIG was perfectly positioned to demonstrate a positive response to a well-crafted reward and recognition program. Reward System Proposal. The proposed reward system is essentially a merit system. It was designed to attract and motivate a highly qualified workforce by ensuring fair pay and establishing a direct link between pay and performance. It is intended to reinforce behaviors(both at a team level and at an individual level(that reinforce the timely bill payment initiative. Finally, it is designed integrally into the fabric of corporate life at AIG as
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Approximate Word count = 1572
Approximate Pages = 6 (250 words per page)

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