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Dr.Mohammed Khizerulla 2
Assistant Professor & HOD, Department of Commerce, HKBK Degree College
Abstract –
This study investigates the interplay between cultural expectations, demographic factors, and employees'
perceptions of monetary rewards. The objective of this research is to investigate how cultural and
demographic factors influence the effectiveness of reward systems to assess the effectiveness of various
types of employee reward systems such as monetary and non-monetary, recognition in enhancing employee
motivation and job satisfaction. To explore the correlation between employee rewards and job performance,
examining how different types of rewards influence individual and team productivity. The data is collected
from the IT sector and the majority of the respondents are only employees. This research studies only
Monetary and Non-Monetary system, Motivation, Job Satisfaction, Recognition and Performance outcome.
This study is based on empirical study. The sampling size is 100 employees who fill the questionnaire for the
survey. Simple random sampling method will be used for sample selection. Primary data and secondary data
are used as a tool for data collection. Correlation test is used to prove the hypothesis. The study reveals
insights into how cultural attitudes towards time influence employees' perspectives on the sustainability and
stability of reward systems. By acknowledging and adapting to the diverse needs of the workforce,
organizations can tailor reward systems, motivation strategies, and recognition programs, fostering
heightened job satisfaction and improved performance outcomes.
Keywords – Monetary and Non-Monetary system, Motivation, Job Satisfaction, Recognition and
Performance outcome.
In the dynamic factors of modern workplaces, the understanding and management of employee rewards
have become pivotal in fostering a motivated, satisfied, and high-performing workforce. The interplay
between cultural and demographic factors significantly shapes individuals' perceptions, expectations, and
responses to reward systems within organizations. This research aims to conduct a comprehensive analysis
of the intricate relationships between cultural and demographic influences and various employee reward
systems, focusing on monetary and non-monetary approaches, as well as the impact on motivation, job
satisfaction, recognition, and overall job performance.
As organizations strive to create environments that cater to the diverse needs of their workforce, it becomes
imperative to recognize the nuanced ways in which cultural backgrounds and demographic characteristics
contribute to employees' attitudes towards reward systems. By delving into these dynamics, this study seeks
to provide valuable insights that can inform more effective and tailored reward strategies, thereby
contributing to the development of workplace practices that resonate with the unique preferences and
expectations of employees across different cultural and demographic contexts.
Employee rewards play a pivotal role in fostering a positive work environment and promoting employee
engagement. However, the efficacy of these reward systems can vary significantly based on cultural nuances
and demographic diversity within an organization. Cultural values, beliefs, and individual characteristics can
influence how employees perceive and respond to different types of rewards. Similarly, demographic factors
such as age, gender, and tenure may contribute to distinct preferences and expectations regarding the reward
structures.
The motivation behind this research stems from the need to bridge the existing gaps in our understanding of
how cultural and demographic factors interact with employee reward systems. By conducting an in-depth
analysis, we aim to provide insights that can inform the design and implementation of more targeted and
inclusive reward strategies, fostering a work environment that accommodates diverse perspectives and
preferences.
Review literature –
Walters T. Ngwa1, Bamidele S. Adeleke2 (2019) the researcher has analysed that there is a crucial link
between reward systems and employee performance, presenting an opportunity for employers to leverage
these systems as motivational tools for refining employee behavior towards enhanced efficiency and
effectiveness. This connection serves as a gateway for management to elevate employee productivity,
ensuring that the reward system impartially recognizes individuals who contribute significantly. This
recognition fosters a sense of appreciation among employees, affirming that rewards are rightfully attributed
to those who execute their tasks successfully and with excellence. As rewards resonate differently with each
employee, the implementation of a fitting reward system becomes instrumental in cultivating employee
commitment to organizational objectives. Such systems act as potent motivators, fostering heightened
loyalty among employees toward organizational goals and targets.
IJRAR1DKP027 International Journal of Research and Analytical Reviews (IJRAR) 193
© 2024 IJRAR February 2024, Volume 11, Issue 1 www.ijrar.org (E-ISSN 2348-1269, P- ISSN 2349-5138)
Puwanenthiren Pratheepkanth (2011) the researcher has conducted an analysis encompassing millions of
employees and organizations in Sri Lanka. While acknowledging the multitude of factors influencing
motivation, the researcher has specifically elucidated how both monetary and non-monetary aspects play a
significant role in shaping the motivation levels of the staff within this bank.
Aina-Obe Shamsuddin Bolatito1 and Yasin Abdikani Mohamoud2 (2024) the researcher has analysed that
there is a relationship between reward management and employee performance, with a particular focus on
job satisfaction in Somalia. This research can serve as a valuable guide for businesses in Somalia, aiding
them in the development and implementation of effective reward management systems to enhance both
employee performance and job satisfaction. It examine into a comprehensive analysis of the interconnection
among incentive management, job satisfaction, and employee performance within the unique context of
Somalia. It explores the specific challenges faced by businesses in Somalia and investigates how the
adoption of effective reward management strategies could enhance job satisfaction and, in turn, boost
employee performance. The researcher commences by examining the importance of incentive administration
in motivating workers and fostering job contentment. This underscores the relevance of both internal and
external incentives in influencing the behavior and productivity of employees. It examine the necessity for
corporations to tailor their compensation systems to align with the cultural and socio-economic conditions
prevalent in Somalia.
Objectives of the study –
1. To investigate how cultural and demographic factors influence the effectiveness of reward systems.
2. To assess the effectiveness of various types of employee reward systems such as monetary and non-
monetary, recognition in enhancing employee motivation and job satisfaction.
3. To explore the correlation between employee rewards and job performance, examining how different
types of rewards influence individual and team productivity.
Research Methodology –
This research is primarily based on the empirical study, outlining the nature of information and the data
source. This study explains about the type of information and the source of the data collected. Sampling
unit implies respondents are employees and questionnaires were administered by the researcher personally
and respondents were educated on how to fill the questionnaires. Simple random sampling has been used
for the sample section. Statistical tools like correlation test have been used to prove the hypothesis for
analysis and interpretation. The data has been presented through tables and graphs.
Data Collection –
1. Primary data, collected from the IT employees through questionnaires.
2. Secondary data, collected from Journals.
2. This research focuses on cultural and demographic factors influence the effectiveness of reward systems,
effectiveness of various types of employee reward systems such as monetary and non-monetary,
recognition in enhancing employee motivation and job satisfaction and correlation between employee
rewards and job performance, examining how different types of rewards influence individual and team
productivity.
3. The information is often biased because of use of questionnaire.
Testing of Hypothesis
Job performance
Frequenc Valid Cumulative
y Percent Percent Percent
Valid SMART Goals 16 16.0 16.0 16.0
Feedback and 15 15.0 15.0 31.0
performance review
Initative and proactivity 35 35.0 35.0 66.0
Problem solving skill 21 21.0 21.0 87.0
Leadership skill 13 13.0 13.0 100.0
Total 100 100.0 100.0
Employee Performance
Frequenc Valid Cumulative
y Percent Percent Percent
Valid Intrinsic Rewards 27 27.0 27.0 27.0
Extrinsic Rewards 21 21.0 21.0 48.0
Recognition and 24 24.0 24.0 72.0
Appreciation
Team based Rewards 15 15.0 15.0 87.0
Customization Reward 13 13.0 13.0 100.0
Total 100 100.0 100.0
Correlations
Employee
Job Performanc
performance e
Spearman's Job performance Correlation 1.000 .241*
rho Coefficient
Sig. (2-tailed) . .016
N 100 100
Employee Correlation .241* 1.000
Performance Coefficient
Sig. (2-tailed) .016 .
N 100 100
*. Correlation is significant at the 0.05 level (2-tailed).
Spearman’s correlation of Job performance and employee reward was found to be positive correlation and
statistically significant (r = 0.241 < 0.05). Hence H1 was accepted. This shows that an increase in job
performance would leads to increase in employee reward.
From the above analysis of the Table 03, (35%) of the respondents says initiative and proactive positively
influence job performance, (27%) of the respondents says intrinsic rewards positively impact on employee
satisfaction, (24%) of the respondents says Recognition and appreciation play a role in employee
satisfaction, (21%) of the respondent’s attribute job performance to problem solving skill, (21%) of the
respondents says Extrinsic Rewards contribute to employee contentment, (16%) of the respondents says
smart goals should be related to job performance, (15%) of the respondents says Feedback and performance
review, (15%) of the respondents believe team-based rewards are effective in fostering employee happiness,
(13%) of the respondent’s attribute job performance to leadership skill, (13%) of the respondents prefer
customization rewards for employee satisfaction.
Major Findings -
1. The researcher has analysed that 23% of respondents perceive a significant influence of cultural factors
on reward system effectiveness.
2. The researcher has analysed that 21% specifically link long-term versus short-term orientation as a
cultural factor impacting reward systems.
3. The researcher has analysed that 20% identify communication style and beliefs as cultural elements
shaping perceptions of reward system fairness.
IJRAR1DKP027 International Journal of Research and Analytical Reviews (IJRAR) 199
© 2024 IJRAR February 2024, Volume 11, Issue 1 www.ijrar.org (E-ISSN 2348-1269, P- ISSN 2349-5138)
4. The researcher has analysed that 18% emphasize the impact of base salaries and bonuses on employee
motivation.
5. The researcher has analysed that 16% stress the effectiveness of incentive programs in driving
employee performance.
6. The researcher has analysed that 12% highlight the importance of verbal recognition for enhancing
motivation and job satisfaction.
7. The researcher has analysed that 35% believe that initiative and proactive behavior positively influence
job performance.
8. The researcher has analysed that 27% recognize the positive impact of intrinsic rewards on employee
satisfaction.
9. The researcher has analysed that 24% attribute job performance to effective problem-solving skills.
10. The researcher has analysed that 13% prefer customized rewards for employee satisfaction.
Recommendations -
1. Encourage cultural awareness programs to foster understanding among employees about the influence
of cultural factors on reward systems.
2. Implement training initiatives to address diverse communication styles, ensuring effective and fair
communication within the organization.
3. Develop a comprehensive recognition program that includes both monetary and non-monetary
elements, aligning with the preferences expressed by employees.
4. Periodically review and update recognition initiatives to ensure relevance and effectiveness in boosting
motivation and job satisfaction.
5. Provide leadership training to enhance leaders' awareness of their impact on employee perceptions of
reward systems. Foster a leadership style that aligns with employee expectations, emphasizing
transparency and fairness in decision-making related to rewards.
6. Establish clear and measurable performance metrics tied to incentives to reinforce the connection
between individual and team efforts and rewards.
7. Regularly evaluate the effectiveness of incentive programs, seeking feedback from employees to make
necessary adjustments.
8. Implement regular feedback mechanisms, including performance reviews and constructive criticism, to
address the importance placed by employees on ongoing communication and acknowledgment.
9. Ensure feedback is constructive, specific, and supports employee development.
10. Offer a range of opportunities for skill development, training programs, and career advancement to
address the identified importance of these factors in motivating employees.
11. Communicate the availability of these opportunities clearly to employees.
12. Explore and implement flexible work schedules, remote work options, and non-monetary benefits to
enhance work-life balance and job satisfaction.
13. Conduct regular assessments of the impact of these initiatives on employee well-being.
Discussion –
1. Organizations can aim to create reward systems that are not only culturally sensitive but also align
with the time orientation preferences of their workforce. Recognizing the impact of long-term versus
short-term cultural factors is essential for designing effective and sustainable reward strategies.
2. By addressing communication style and values and beliefs, organizations can create reward systems
that are not only culturally sensitive but also resonate with the diverse perspectives and expectations
within the workforce. These suggestions aim to enhance the effectiveness and fairness of reward
systems in a culturally diverse environment.
3. By addressing leadership styles in the context of cultural factors, organizations can enhance the
alignment between leadership practices and the design and implementation of effective reward
systems. This can contribute to a more positive and inclusive organizational culture that recognizes and
values the diversity of its workforce.
4. Organizations can optimize their compensation structures and reward systems to align with employee
expectations, enhance motivation, and contribute to overall job satisfaction. Recognizing the impact of
both monetary and non-monetary rewards allows for a comprehensive and tailored approach to
employee motivation.
5. By focusing on the effectiveness of incentive programs and incorporating both monetary and non-
monetary forms of recognition, organizations can create a comprehensive approach to driving
employee performance and satisfaction. This approach aligns with the diverse preferences and
motivations of a workforce, contributing to a positive and motivating workplace culture.
6. By prioritizing verbal recognition and integrating it into the broader framework of employee reward
systems, organizations can create a positive and appreciative workplace culture. Verbal recognition,
when done effectively, not only enhances motivation and job satisfaction but also contributes to a sense
of belonging and engagement among employees.
7. Organizations can optimize the effectiveness of awards in their employee reward systems. Well-
designed and meaningful award programs can significantly contribute to enhancing employee
motivation, job satisfaction, and overall engagement within the workplace. Offer a variety of award
categories to recognize different types of achievements, such as performance excellence, innovation,
teamwork, and leadership. This ensures inclusivity and caters to diverse contributions.
Conclusion –
The researchers has analysed that cultural and demographic influences on employee rewards reveals a
complex and dynamic landscape where various factors play a significant role in shaping employees'
experiences, motivation, job satisfaction, recognition, and performance outcomes. The study explores both
monetary and non-monetary reward systems to provide a comprehensive understanding of how cultural and
demographic factors impact these critical aspects of the workplace.
The study highlights that cultural and demographic factors significantly influence employees' perceptions of
monetary rewards. Different cultures may have distinct attitudes toward financial compensation, with some
placing greater emphasis on financial security and others valuing additional perks and benefits. Furthermore,
demographic factors such as age, education level, and job role can influence employees' expectations
regarding fair compensation. Organizations should consider these nuances to tailor their monetary reward
systems effectively.
The research underscores the importance of non-monetary rewards in contributing to employee motivation
and satisfaction. Cultural preferences and demographic characteristics, such as generational differences,
impact the effectiveness of non-financial incentives. Organizations must recognize the diverse needs and
preferences within their workforce to design non-monetary reward systems that resonate with different
cultural and demographic groups.
Cultural and demographic influences play a crucial role in shaping employee motivation. The study reveals
that certain cultural values, such as collectivism or individualism, can impact the types of motivational
factors that resonate with employees. Additionally, generational differences may influence the importance
placed on intrinsic versus extrinsic motivation. Organizations should tailor motivational strategies to align
with the cultural and demographic dynamics of their workforce.
The analysis indicates a strong link between cultural and demographic factors and employee job satisfaction.
Cultural expectations around work-life balance, job security, and recognition significantly contribute to
overall job satisfaction. Demographic characteristics, such as age and tenure, also influence how individuals
perceive their job satisfaction. Organizations should consider these factors when designing workplace
policies and practices to enhance employee satisfaction.
The research suggests that cultural and demographic influences have a substantial impact on performance
outcomes. Employee performance is not solely determined by monetary incentives but is also shaped by the
alignment of organizational practices with cultural values and demographic expectations. Understanding
these influences is crucial for organizations seeking to optimize performance outcomes and drive overall
success.
In conclusion, a holistic understanding of cultural and demographic influences on employee rewards is vital
for organizations aiming to create an inclusive and motivating workplace. By recognizing and adapting to
the diverse needs and expectations of their workforce, organizations can develop reward systems, motivation
strategies, and recognition programs that resonate with employees, ultimately leading to improved job
satisfaction and enhanced performance outcomes.
Reference –
1. Walters T. Ngwa1, Bamidele S. Adeleke2 (2019) “effect of reward system on employee performance
among selected manufacturing firms in the litoral region of cameroon” Volume 18, Issue 3, 2019 pg: 1
– 16 1939-6104-18-3-382
2. Puwanenthiren Pratheepkanth (2011) “Reward System and Its Impact On Employee Motivation In
Commercial Bank Of Sri Lanka Plc, In Jaffna District” Global Journal of Management and Business
Research Volume 11 Issue 4 Version 1.0 March 2011 Pg: 85 – 95 Double Blind Peer Reviewed
International Research Journal Publisher: Global Journals Inc. (USA) ISSN: 0975-5853
3. Aina-Obe Shamsuddin Bolatito1 and Yasin Abdikani Mohamoud2 “Reward Management and
Employee Performance: A Review of Job Satisfaction in Somalia”
TWIST, 2024, Vol. 19, Issue 1, pp. 128-137.