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The Influence of Rewards on Employees Performance

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The study aims to examine the influence of reward types (extrinsic, intrinsic, social and rewards mix) on employees performance. Subjects for the study consisted of 308 workers which constituted 60% of the total target population of 513 people of unified mining companies located at Al-Shedia Phosphate mines in the southern of Jordan. 308 self-designed questionnaire were distributed to employees on job location, 268 questionnaires were returned and only 250 were suitable for statistical analysis. SPSS version 16 has been used to for data analysis. Both descriptive and inferential statistics were used for data analysis. The statistical tools were aligned with the objective of the research. For this purpose, frequency tables, percentages, means and standard deviations were computed and substantively interpreted. Inferential statistics like Pearson product moment correlation coefficient (r) was used to determine if there is a significant positive relationship existed between the independent variables (rewards types: extrinsic, intrinsic, social and rewards mix) and dependent variable (employees performance). Analysis and interpretation were made at 0.05 level of significance. The findings indicated that there is a statistical significant relationship between rewards types and employees performance. The study has concluded that, management should have deep sense of commitment towards the issue of rewarding employees, if they are to enhance performance levels. Finally, future research can be conducted to cover all types of rewards and determine their affect on performance.
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*Corresponding author: E-mail: mohd_alsalah@yahoo.com;
British Journal of Economics, Management & Trade
13(4): 1-25, 2016, Article no.BJEMT.25822
ISSN: 2278-098X
SCIENCEDOMAIN international
www.sciencedomain.org
The Influence of Rewards on Employees
Performance
Mohammed Raja Abulraheem Salah
1*
1
Department of Administrative and Financial Studies, Maan University College, Al-Balqa Applied
University, Maan, Jordan.
Author’s contribution
The sole author designed, analyzed and interpreted and prepared the manuscript.
Article Information
DOI: 10.9734/BJEMT/2016/25822
Editor(s):
(1)
O. Felix Ayadi, Interim Associate Dean and JP Morgan Chase Professor of Finance, Jesse H. Jones School of Business,
Texas Southern University, TX, USA.
Reviewers:
(1) Sarminah Samad, Universiti Teknologi Mara, Malaysia.
(2)
Anonymous, Riphah International University, Islamabad, Pakistan.
(3)
Borislav Kolaric, Serbia.
Complete Peer review History:
http://sciencedomain.org/review-history/14725
Received 22
nd
March 2016
Accepted 3
rd
May 2016
Published 22
nd
May 2016
ABSTRACT
The study aims to examine the influence of reward types (extrinsic, intrinsic, social and rewards mix)
on employees performance. Subjects for the study consisted of 308 workers which constituted 60%
of the total target population of 513 people working for Unified Mining Companies located in the
southern part of Jordan. Total of 308 self-designed questionnaire were distributed to employees on
their job location, 268 questionnaires were returned and only 250 were suitable for statistical
analysis. SPSS version 16 has been used for data analysis. Both descriptive and inferential
statistics were used for data analysis. The statistical tools were aligned with the objective of the
research. For this purpose, frequency Tables, percentages, means and standard deviations were
computed and substantively interpreted. Inferential statistics like Pearson product moment
correlation coefficient (r) was used to determine if there is a significant relationship exist between
independent variables (rewards types: Extrinsic, intrinsic, social and rewards mix) and dependent
variable (employees performance). Analysis and interpretation were made at 0.05 level of
significance. The findings indicated that there is a statistical significant relationship between rewards
types and employees performance. The study has concluded that, management should have deep
sense of commitment towards the issue of rewarding employees, if performance levels to be
enhanced. Finally, future research can be conducted to cover all types of rewards and to determine
their affect on performance.
Original Research Article
Salah; BJEMT, 13(4): 1-25, 2016; Article no.BJEMT.25822
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Keywords: Extrinsic rewards; intrinsic rewards; social rewards; rewards mix; employees performance;
mining companies.
1. INTRODUCTION
Rewards and their influence are becoming an
issue of concern for all. Therefore effective
reward management deals with setting
processes, policies and strategies. Such
practices are required to ensure that the
contribution of employees to the business is
recognized by those responsible for the running
of the organization. The main theme of reward
management is to reward employees fairly,
equitably and consistently in correlation to the
value of these individuals to the organization.
Reward system exists in order to make
employees work towards achieving strategic
goals through enhancing their productivity and
performance levels. Reward management is not
only concerned with pay and employee benefits.
It is equally concerned with non-financial rewards
such as recognition, training, development and
increased job responsibility.
Human resources are increasingly becoming one
of the most important concerns of business
organizations; therefore, people have to be
effectively managed and highly valued by the
organizations. According to [1], motivation can be
defined as the process of stimulating or inducing
people to take the desired course of action.
Furthermore, it is the act of inspiring employees
to work hard to achieve the goals of the
organization. Workers motivation requires deep
insights on both parties, the management and
the employees. In this regard [2], argued that the
best means of understanding workers attitudes
towards rewards and performance is to consider
the social meaning of work. In this respect, short
and long-term goals of employees and
employers may affect both performance and
production variously. For employees to give the
best of their effort, they have to be rewarded.
Rewards are regarded as the best methods to
achieve this. According to [3], rewards were one
of the important elements used to encourage
employees for contributing their best effort to
generate innovation ideas that lead to better
business functionality and furthermore, improves
companies performance both financially and non
financially. Organizations can also gain more
overall performance benefits from their rewarded
employees. The study carried out [4] stressed
that human resources are the most essential
area among all resources of the organization;
and they added that competent, knowledgeable
and motivated personnel not only essential in
overall performance of an organization but also
can help to make the organization more
competitive, more value added and cost
effective.
The purpose of this study is to investigate the
influence of rewards on employees performance
at Unified Mining Companies located in the
Southern of Jordan, Governate of Maan, Al-
Shedia Phosphate Mines.
1.1 Statement of the Problem
The existence of rewards and its effective
management is one of the various organizational
strategies used to enhance employees and
organizational performance. However, much of
the published research on this subject has shown
a great deal of disagreement on whether reward
systems through the use of various kinds
(extrinsic, intrinsic and social rewards) could
increase employees performance or not. Many
studies have shown a positive relationship
between rewards management and desired
levels of performance, while other studies see
the use of certain types of rewards as
predetermine to expected increase in employees
performance and hence not meeting
organizational goals and objectives.
Disagreement among practitioners, scholars, and
researchers; and the presence of serious gaps
that clearly defines the logical relationship
between independent variables and performance
has created a need for additional evidence on
rewards and performance relationship and
across various sectors and in different contexts.
Based on this background, the study was
conducted to determine the effect of rewards on
employees' performance in the Unified Mining
Companies located in the Southern of Jordan, Al-
Shedia Phosphate Mines, Jordan, Governate of
Maan.
1.2 Objectives of the Study
The objective of this study is to identify the kind
of relationship that exists between rewards and
employees performance in Al-Shedia Unified
Mining firms located in the southern of Jordan.
More specifically, the objectives were named to
find out the following:
1. The effect of extrinsic rewards on
employees performance
Salah; BJEMT, 13(4): 1-25, 2016; Article no.BJEMT.25822
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2. The effect of intrinsic rewards on
employees performance
3. The effect of social rewards on employees
performance
4. The effect of mix rewards (extrinsic,
intrinsic and social rewards) on employees
performance.
1.3 Study Research Questions
The research questions include the following:
1. What is the effect of extrinsic rewards on
employees performance?
2. What is the effect of intrinsic rewards on
employees performance?
3. What is the effect of social rewards on
employees performance?
What is the effect of rewards mix (extrinsic,
intrinsic and social rewards) on employees
performance?
1.4 Hypotheses of the Study
The hypotheses of this study are taken as
follows:
Ho: There is no significant direct relationship
between extrinsic rewards on employees
performance.
H1: There is significant direct relationship
between extrinsic rewards on employees
performance.
Ho: There is no significant direct relationship
between intrinsic rewards on employees
performance.
H2: There is significant direct relationship
between intrinsic rewards on employees
performance.
Ho: There is no significant direct relationship
between social rewards on employees
performance.
H3: There is significant direct relationship
between social rewards on employees
performance.
Ho: There is no significant direct relationship
between rewards mix (extrinsic, intrinsic
and social rewards) on employees
performance.
H4: There is significant direct relationship
between rewards mix (extrinsic, intrinsic
and social rewards) on employees
performance.
1.5 Importance of the Study
As it is known to all, employees have different
needs and place different values to the rewards
they may expect to receive and consequently
they fine-tune their performance and productivity.
The intended study results will enable
management to plan, set and implement effective
and efficient rewards strategies that may lead to
improved performance of the organization which
in turn will lead to economic growth and stability
of mining industry and hence growth and stability
of the country. Therefore, the importance of the
study stems from the importance of the subject in
hand, where rewards play an important role in
influencing employees behavior, motivation, and
satisfaction and consequently affect their
performance and productivity.
1.6 Scope of the Study
The research is conducted talking into account
the following limits: The research is limited to the
selection of employees of the biggest three
miming companies (Unified Companies) located
in southern part of Jordan, Al-Shedia Phosphate
Mines. Time is another constraint which affected
the conduction of the study and because of that,
the research is unable to cover other companies
working in the same location or other companies
working in other mines in other geographical
locations in the kingdom. The research has
focused on the respondents from all
management levels within these firms; hence,
the numbers of respondents involved in this
study are 250 persons who were selected
randomly.
1.7 Literature Review
1.7.1 General literature review
Most business organizations use one type or
another of rewards to enhance workers
performance. Unfortunately, it is not yet clear as
to which type of rewards in particular has the
most effective impact on people reactions and
performance. The work of [5] defines rewards as
positive outcomes that are earned as a result of
an employee's performance and these rewards
are aligned with organizational goals. When an
employee helps an organization in the
Salah; BJEMT, 13(4): 1-25, 2016; Article no.BJEMT.25822
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achievement of one of its goals, a reward often
follows. There is a great of agreement in
literature regarding the types of rewards used in
real life situations. According to [6], rewards are
categorized into two groups, financial and non-
financial rewards. The financial rewards are also
called extrinsic rewards and the non-financial
rewards are called intrinsic rewards. Other
researchers like [7] argued that, three types of
rewards existed and to which individuals are
normally attracted to and seek from their
organization; these are extrinsic, intrinsic and
social rewards. The study of [8] best illustrates
the differences between extrinsic and intrinsic
rewards. Extrinsic rewards refer to physical
benefits provided by the organization such as
pay, salaries, bonus, fringe benefits, and career
development opportunities.
Intrinsic rewards on the other hand, refer to the
rewards that come from the content of the job
itself and encompass motivational characteristics
of the job such as autonomy role clarity and
training. The list of differences between extrinsic
and intrinsic rewards goes on to include further
additions for extrinsic rewards as suggested by
[9] for example, extrinsic rewards may include
tangible or external rewards like incentives,
promotions, job security, contract of service,
allowances and insurance. While intrinsic
rewards, or intangible psychological rewards may
include further elements for instance,
appreciation, meeting the new challenges,
positive and caring attitude from employers, job
rotation, sense of achievement, professional
growth and individual recognition.
On the contrary, social rewards as named by [10]
arise from the interaction with other people on
the job and may include, having supportive
relationships with managers, supervisors and co-
workers. This view is supported by [11], in which
he defined social rewards as non-related factors
such as the interpersonal relationships with
colleagues and supervisors support. In line with
extrinsic and intrinsic rewards, social rewards
can also be classified into tangible and intangible
rewards [12]. Tangible social rewards evoke
positive senses of well-being when one receives
an object that fosters a positive sense of well-
being, like a treasured toy, piece of jewelry,
monetary incentive, etc. In contrast, intangible
social rewards are not physical objects but are
elicited during social interactions. Social
interactions generate a positive sense of well-
being when one feels that one belongs, is
accepted by others during social interactions,
and is able to experience mastery during tasks or
during social interactions. Both tangible and
intangible sensory and intangible social rewards
are capable of instilling rewarding outcomes of
positive senses of well-being and positive
emotions like happiness and contentedness.
Human beings and animals a like hope,
anticipate, and expect to obtain rewards and
associated positively rewarding outcomes.
The existence of rewards and their management
is becoming an increasing issue of importance
not only to practitioners and scholars but also to
the concerned parties associated with the
organization, (that is the employer and the
employees). Understanding this critical point will
make all concerned parties aware of the fact that
rewards systems do have influence over the way
employees perform their tasks and in return
achieve organizational strategic goals and
objectives. So one can say a proper alignment or
the use of reward systems with set organizational
strategies will associate organizational
effectiveness. The question that would raise is
that, which kind of reward practice should the
organization and the employees target for, that is
what mix of extrinsic, intrinsic and social rewards
should be used to achieve goals of parties
involved. To do that, the following classification
can be considered as seen in Fig. 1.
Fig. 1. The structure of different types of intrinsic, extrinsic and social rewards that can be
offered and as reviewed in this study
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Many researchers found that people are divided
on this issue. Some argue that the best way to
boost employees' performance is by
concentrating on extrinsic rewards. This view is
supported by [13] through on line study of 1913
full-time employees. These employees were
asked to rank order 14 potential performance
incentives in order of preference. These
performance incentives included common
extrinsic rewards such as cash bonuses, gift
cards, award points and travel awards, as well as
intrinsic rewards, such as having more freedom
and autonomy at work, choosing interesting
projects and monitoring other employees. He
concluded that cash bonuses were listed as the
most preferred incentive by three out of four
people (74%) surveyed and nine out of ten (89%)
listed cash bonuses within their top three
preference. In agreement with other research
[14] believed that, money is influential for fulfilling
employees' non-monetary needs such as
authority, rank and belongingness with preferred
groups. It's believed that people who have more
money are more powerful in society as compared
to those who have lesser money. That is why
money is often viewed as assign of personal
triumphs and accomplishment.
Deep examination of literature on extrinsic
monetary rewards reveals that it might be true
that extrinsic monetary rewards could lead to
improvement in performance and productivity but
on the contrary, most research findings
confirmed less relationship between extrinsic
rewards and performance. [15] in his series of
studies concluded that, extrinsic rewards-
concrete tangible rewards such as bonuses, pay
increase and awards are detrimental to
innovation. A similar finding was cited in the work
of [16] in which he concluded that, financial
rewards are not the most motivating factors and
financial results have a de-motivating effect
among employees.
According to [17], although cash rewards are
generally welcomed by employees; managers
should never use this as a tool to motivate their
employees to improve performance levels.
Should this happen, there is a chance that the
essence of reward would be forgotten. A great
deal of literature findings also showed variations
in the way people perceive rewards and the
value they attach to them. According to [18], and
based on Herzberg's two factor theory of
motivation; higher occupational levels tend to put
more value on "motivators" or intrinsic job
factors, while at lower occupational levels
"hygiene factors" or extrinsic job factors were
more valued. Hence, an organization that
satisfies both extrinsic and intrinsic rewards get
the best of their employees. Although value
theme is important, other criteria like type of
business, size of business, the market in which
the organization operates in, operation period
and the type of technologies used have a
significant impact regarding the choice of
extrinsic and intrinsic rewards mixture. According
to [19], originators of technology in large firms
are likely to be different from that of small firms
entrepreneur .Technical personal within large
firms seem more likely motivated by non
monetary rewards that affect intrinsic value than
by monetary rewards. Entrepreneurs in smaller,
newly – emerging firms are more likely to be
motivated by extrinsic rewards that encourage a
stake in the venture. This knowledge triggers a
signal to the fact that extrinsic and intrinsic
rewards practices in firms applying TQM may
differ according to size. On the other hand, a
research application of extrinsic and intrinsic
rewards may depend on the market in which they
operate in and as mentioned before the
operation period of the firm.
On the other extreme, other researchers
supported with valid empirical findings argue
that, intrinsic rewards are just as important as
extrinsic rewards and May for some employees
see them as stronger motivator and
consequently tend to increase their productivity
and strive for more professional development. In
addition to this view, literature has cited that
people have different perceptions of rewards. For
instance, some people consider recognition by
managers or supervisors more rewarding than
financial incentives because this brings to them
more inner feelings of happiness that money may
not afford to bring. The study of [20], stressed
that, employees who are able to experience and
receive recognition for their work are also able to
have a better perception of their work, their
workplace and the people they work for and
hence positive contributions towards the
organization and its overall objectives. [21]
argued that, intrinsic non-financial incentives in
organizations are most closely associated with,
recognition and performance feedback and non-
financial incentives of recognition do not have
extensive theoretical foundation as that of
money. To achieve that they identified
conceptual differentiation between the concept of
recognition and social recognition. According to
them, recognition refers to formal programs such
as employees of the month or top sales award.
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Where, as social recognition refers to informal
acknowledgment attention, praise, approval of
genuine appreciation for work well done from one
individual or group to another. As with extrinsic
rewards, careless use of intrinsic rewards may
lead to negative consequences. [22] claimed
that, employees who see the incentive scheme
as opportunity to wrest control of their personal
activities that provide little intrinsic satisfaction.
These days many companies have designed
reward systems that target for an employee's
skills development. However, this reward system
may not always bring positive effects in an
organization. For example, when some
employees pursue only their own interests, the
organizations objectives would be a low priority
to them.
Practically, human resources managers use
various strategies to achieve the set goals and
objectives of organizations. One of such
strategies is that reward management. Reward
management strategies is normally concerned
with attracting and retaining of suitable
employees and then providing them with all
conditions that enable them to improve their
performance through proper motivational tools
and techniques According to [23], the purpose of
reward system is to a systematic way to deliver
positive consequences and fundamentally, the
purpose is to provide positive consequences for
contributions to get the desired performance
levels. This view is parallel to the view of [24] in
which he said that, the only way employees fulfill
the employers dream is to share in their dreams
through the mechanism of rewards that normally
include, systems and practices of awards,
recognition, promotions, reassignment, non-
monetary bonuses like, vacations or a simple
thank you. A clear-cut aims of reward
management according to [25], can be divided
into two distinctive parts; the first one is
"participation in organization" and the second is
"performance in organization". Firstly The notion
of participation means to make employees
getting a sense of belonging and becoming a
member of organization by feeling of part of
community, they can not only develop a desire to
stay for a long time as a member of an
organization but also devote great effort to their
work. Thus, rewards can attract people to join an
organization and encourage behavior that
contributes to the achievement of an organization
objectives. Therefore, one of aims of reward
management is to give employees a sense of
belonging and motivate their attendance.
Secondly, the notion of "performance in
organization" means that reward systems are
generally designed to fit for an employee's
performance. To be specific, employees seek to
use rewards to dominate an employee's behavior
and to increase productivity. In this sense,
employers have minimal expectations for each
employee. Thus, when employees reach an
expected level of job performance, an
organization will pay attention to them and give
them proper reward. Furthermore, if a reward,
system is set up fairly and equitably; most
individuals in the organization will make greater
efforts for companies. For these aims to be met
reward systems should bosses certain qualities.
Firstly, good or convenient reward system should
encourage employees to give their best.
According to [26], the payment package is one of
the most obvious and visible expressions of the
employment relationship. This means that
rewards are the most efficient way to encourage
an employee's best behavior and this can be
linked to the achievement of organizational goals
and objectives. Secondly, since markets that
business organizations operate in are
changeable in nature; rewards should also be
adoptable to change and able to deal with market
flexibility. In his research, [27] found that, the
higher the level of adoptability of a firm, the
higher the level of environmental complexity that
can be handled by that firm and the better the
chances of its long-term survival, and an integral
part of that adoptability was "a flexible reward
structure". Thirdly, any reward or incentive
systems should be fair and non-discriminatory.
The notion of fairness and non discrimination is
mandatory by legislation and go in line with the
difficult concept of" equal pay for equal work".
According to [28], in practice reward systems or
strategies come in all shapes and sizes, and
there is no single reward package that offers "a
best practice approach". Legislation requires
reward systems to be fair and non-discriminatory.
Although the concept of" equal pay for equal
work" can be difficult to work in practice, these
are requirement under Legislation for basic
component (up to the statutory minimum) for
elements such as maternity pay; sick pay;
access to pension schemes; paid holiday; and for
payments up to at least equal to national
minimum wage. A decision may well be
necessary in many organizations as to whether
exceed the statutory minimum or not. According
to [29], for reward systems to be effective they
have to be seen as fair. This means that there
has to be openness with respect to information
about how the reward system operates and how
employees will be rewarded. Employees should
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be involved in designing the reward system and
its administration. Fourthly, reward systems
should be effective and efficient. According to
[30], reward systems should be effective and
efficient so that such actions are realized in the
corporation and this system should be designed
in a way that creates maximum returns for both,
the corporation and the individuals. [31] pointed
that an effective reward systems requires an
experimental attitude; continual fine-tuning of the
system; inputs from people within the system and
ongoing evaluation of effectiveness of the
system. [32] concluded that, effective reward
systems leads increased satisfaction for
employees, recognition of accomplishment; a
desire to attain high standards a means to
achieve personal and social goals; high
productivity and feeling of competence and
freedom. Fifthly, since employees are different in
their perception, attitude, mentality and
orientation, then a contingent reward system is
needed. According to [33], an important task of
management is to know how to integrate
extrinsic, intrinsic and social rewards
successfully. Employees are different for the kind
of rewards that they want, under different
organizational conditions. These conditions
implies that what is needed is a contingency
approach to rewards that considers needs of
workers, type of jobs, organizational
environment, and the fact that some of the most
important rewards are in the form of fringe
benefits and allowance. These rewards are often
more valuable to employees because they have
more psychological and social meaning. Special
benefits may be evidence of recognition, status,
or other important social values. Finally yet
importantly reward systems should be well
structured, and fits well into the organizational
strategies. According to [34], an effective reward
system may have three components: Immediate,
short- term and long-term incentives. This means
immediate recognition of a good performance,
short- term rewards for performance could be
offered monthly or quarterly and long-term
rewards are given for showing loyalty over the
years. Immediate rewards are given to
employees repetitively so that they can be aware
of their outstanding performance, such rewards
include being praised by an immediate
supervisor or it could be a simple tangible
reward. Short-term rewards are made either
monthly or quarterly bases depending on
performance. Examples of such rewards may
include cash benefits, or special gifts for
exceptional performance. [35] stated that long-
term rewards are awards given to employees
who have been performing well. Such an
employee will become loyal to his or her
organization and it reduces employees' turnover.
Long-term rewards include being made partner
or cash benefits that mature after many years of
service or at retirement. These rewards are
strategic for retaining the best human resources.
Employees and employers should be aware of
the strong relationship between rewards and
performance, that is the relationship between,
how people perform and what they expect must
be clearly defined. Performance management
programs can be used to plan employees
performance, monitor performance, measuring
performance, and evaluate performance and
controlling performance. To achieve that a well
designed system needs to be developed to link
positive contributions with rewards. This link can
be seen as the mutual gain between rewards or
incentives received and targets or goals attained.
According to [36], there is symbiotic relationship
between human resource strategy and
performance. In order to fully understand the
influence of rewards on employees' performance;
one need to give a proper definition of
performance. According to [37], organizational
performance comprises the actual outputs or
results of an organization measured against its
intended output (i.e. organizational goals and
objectives). Performance, according to [38], is
defined as a discipline of acting upon intelligence
and reported information in planning ahead and
in managing services operations both directly
and through partnerships with other delivering
agents. They described it as processes that
contribute to the effective management of
individuals and teams in order to achieve high
levels of organizational performance. In their
research paper [39] argued that paying for
performance is a big issue in a contemporary
human resource management; organizations
have long believed that productivity improve
when pay is linked to performance and payment
results systems and incentives are developed to
support this belief. Rewards received can cause
great satisfaction among employees, and
satisfaction level is directly associated with
employees performance. [40] concluded with set
of factors that influence the performance with
regards to work. Firstly, it depends on the
amounts received and the amount the individual
feels he or she should receive. Secondly,
comparison to what others collect influences
people performance. Thirdly, employees levels of
satisfaction with both intrinsic and extrinsic
rewards received affect overall job performance.
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Furthermore, the study of [41] showed that
companies could gain competitive advantage
over other firms by motivating and retaining
human resources. Here, organizations motivate
the high performers by providing financial and
non-financial reward systems that would motivate
the employees and enhance job satisfaction.
Financial and non-financial rewards have strong
influence over the employees' motivation and are
directly related to performance. The significance
of financial and non-financial rewards varies with
age. The non-financial rewards influence
motivation largely after the pay exceeds a certain
level. Once again, which kind of rewards can
best lead to increased performance still needs
more research. However, [42] conducted
research on non-financial rewards and workers
job satisfaction and research claimed that an
effective reward package could have an
important impact on the employees'
performance. Stovall study showed that non-
financial rewards motivate workers and that
leads to job satisfaction that in turn leads to
increased level of performance. A valid starting
point to reward employees for their increased
performance would be measuring this
performance. Measuring performance is still to
some extent troublesome, especially in countries
where employees are normally paid set wages or
salaries and sometimes overtime payment. In
discipline of human resource management,
writers such as [43], [44] gave suggestions
regarding measuring employees performance
and its practical indicators. According to them,
the following are some indicators for measuring
employees performance, quality that can be
measured by percentage of work output that
must be redone or is rejected; customer
satisfaction that can be measured by the number
of loyal customers and customers' feedback.
Also timeliness measured in terms of how fast
work is performed by the employees when given
a certain task; absenteeism tardiness when
employees absent themselves from work; and
achievement of objectives measured when an
employee has surpassed his or her set targets,
he or she is then considered to have performed
well to achieve objectives. Once performance is
measured, the next step that becomes so urgent
is that, should rewarding performance be based
on individual or group merits. Larger part of
human resources literature give a credit to the
theme of individual performance, according to
[45] the management of individual performance
within organizations has traditionally centered on
assessing performance and allocating rewards
with effective performance seen as the result of
the interaction between individual ability and
rewards. It is increasingly recognized that
planning and enabling environment have a
critical effect on individual performance, with
performance goals and standards, appropriate
resources, guidance and support from the
managers all being central. The argument for
prompt effective remuneration strategy begins
with the simple concept that all rewards are
based on individual performance results. In their
research [46] stated that the system of payment
by results is based on the principle of scientific
management and tasks that could be measured
by standard assessment. In this context,
employees belief that, if they produce an average
rate of outcomes they will expect to receive their
normal payment, while if their outcomes are
above the average level they will receive a bonus
or other kinds of rewards because they produce
more results than other colleagues or produce
results above an employer's expectations.
According to [47], an individual's behavior in a
certain way is greatest when he or she believes
that their behavior will lead to certain rewards. In
this way, the method of payment by results is the
most prompt and efficient way to motivate
employees. Team performance, on the other
hand has its share in literature. According to [48],
team bonuses are used to show that the
company is serious about valuing team
contributions to quality and increased
productivity. Here, the monetary rewards consist
of a cash bonus allocated to each team member;
and given separately from their salary. Within this
context [49] and when reviewing business
concepts developed by the best companies to
deal with the increasingly turbulent environment,
it was found that these organizations employed
reward systems that emphasized group
performance of individual performance. Also
research conducted into a list of productive
companies, [50] assumed that the pay plans of
the companies where the reason they achieved
high productivity. Instead, he found that these
pay plans that were based on group productivity
– based compensation, drove and reinforced the
culture that in turn increased productivity. Finally,
the methods used to link rewards to performance
are numerous; and their explanation is beyond
the scope of this study. However, it has hoped
that, this study will provide the base for thorough
and beneficial future research in the field of
rewards management and its applications.
1.7.2 Empirical literature review
Research on the field of rewards and
performance is very extensive. In this study more
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9
light will be shed on the relationship between the
independent variable (rewards types: Extrinsic,
intrinsic and social rewards) and the dependent
variable (performance). The identification of this
relationship is important, so that those in charged
in the management of rewards systems can
design a diverse reward systems that meet all
employees needs, differences, desires and
expectations, at the same time attaining
organizational goals and objectives through
higher levels of performance and productivity.
The following selected studies may help in
designing contingent or diverse reward systems:
The study of [51] aimed to investigate different
factors determining extrinsic and intrinsic
rewards in the light of Herzberg's two-factor
theory and their impact on banking employees
job satisfaction and job performance and
endeavors to influence overall performance of
commercial banks of Pakistan. For this purpose,
200 employees were selected and 165
completed questionnaires were used for
statistical analysis. The results of this study
showed that the provision of extrinsic and
intrinsic rewards rated as satisfactory, and that
respondents agreed that extrinsic and intrinsic
rewards increased job performance of
employees. The study was considered as a
milestone for understanding systems of rewards
and their effect on overall organizational
performance, especially in Eastern countries.
[52] conducted a similar study that aimed to
examine the relationship between rewards and
employees performance as well as to identify the
relationship between extrinsic and intrinsic
rewards. The study explored factors determining
extrinsic and intrinsic rewards and their impact
on employees performance and actions to
influence the commercial banks for a
consideration of a more systematic and a
structured approach to acknowledge employees
efforts which in turn prosper high performance
culture in commercial banks of Bangladesh. For
the sack of collecting relevant information, 200
questionnaires were distributed and 180 were
returned and used for statistical analysis to test
the hypotheses derived from predictive theories.
The t-test showed that, there is a statistical
significant relationship between extrinsic and
intrinsic rewards on employees performance, that
is a positive relationship between rewards and
employees performance and a highly positive
significant relationship between extrinsic and
intrinsic rewards, and due to this positive
relationship, banks of Bangladesh should keep
using rewards if they to increase their
performance. [53] this study aimed at
determining the effect of rewards on employees
performance at Kenya power and lighting
company plc. Specifically the studies sought to
determine the effect of cash bonus on
employees' performance. 68 questionnaires were
collected and used for statistical analysis and
chi-square was used to analyze and test the
hypothetical relationship between cash bonuses
and employees performance. The findings of the
study, showed that cash bonuses have no effect
on employees performance, this was due to the
variation in opinion regarding whether cash
bonuses affect performance or not. The study
concluded that the organization should focus on
changing the intrinsic nature and content of jobs;
this according to them will increase employees'
performance, as employees will get more
autonomy, more jobs that are seek challenging
assignments and responsibilities. The study
concluded that, further research can be done to
cover other elements of rewards such as owing
equity, so that their findings can be used to
enhance management of performance. Diversity
of reward systems and its alignment with other
firms' strategies is seen by many researchers to
have a positive influence on organizational
performance. The study [54] sought to
investigate the effect of rewards and
compensation strategies on the performance of
commercial banks in Kenya. The study targeted
a population of 46 banks with total number of
employees 2738. A stratified random sample of
349 employees was selected and self-
administered questionnaires and interviews were
used to collect data and (SPSS and MS Excel)
packages were used for statistical analysis. Main
findings of this study included that rewards and
compensation strategies used have a significant
effect on performance of commercial banks in
Kenya. The study established that banks are
currently emphasizing on rewarding and
compensating their employees therefore, bank
performance is influenced by human resource
management actions. Based on findings, a
positive relationship was identified between
rewards and compensation strategies and
employees performance. They concluded that
banks should embrace the use of both financial
and non-financial rewards beside other
incentives and pay schemes. [55] aimed to
investigate the influence of rewards on
employees' performance. The case study
approaches was used to conduct this study, and
for these sack two groups of the respondents
were involved: Front line management and
employees. Samples of 100 respondents were
taken and data collected through questionnaires
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and SPSS package was used to analyze the
data. Findings included that in order for the
organization to perform well the following issues
should be considered for the betterment of the
company. These issues include expression of
employees views, participation in decision-
making, provision of continuous training; good
working environment and good working
equipment; good pay and the provision of
required allowances. The researcher
recommended that the company should provide
training, promotion, house allowance, transport
allowance and management should respect and
delegate power to employees in order to do their
duties well, especially on those issues
concerning how to reward employees in order to
enhance their performance. As discussed earlier
on, the relationship between motivation and
organizational performance is stronger than one
could imagine. Some researchers see this
relationship as imperative. The study of [56]
aimed to identify and investigate both financial
and non-financial rewards that affect the
motivation of employees in organizations. In this
paper, imperativeness between motivation and
performance; and retention of employees were
discussed. To collect data questionnaires were
distributed to 25 employees in Astro Films (PVI)
situated in Lahore city of Pakistan. The
researchers have found that there are different
factors that may affect the motivation of
employees, and these factors can be classified
into two groups: Financial and non- financial
rewards. According to them, although financial
rewards are important for employees' motivation;
the importance of non- financial rewards cannot
be discriminated. The study concluded that
human resource management should explore all
factors that motivate employees and must pay
attention to the problems of employees'
motivation for the overall benefits of the
organization. [57] this study sought to determine
the role of rewards system in promoting
employees motivation in the Kenyan micro
finance institutions. The study targeted 86
employees from which a stratified random
sample of 43 respondents were drawn and to
which questionnaires were distributed. Data
collected were analyzed using SPSS package.
The study concluded that, career development
and coaching mentoring are the greatest
component of employees motivation and that a
good work environment is the most important
component of intrinsic rewards that many
organizations offer to appropriate employees,
other intrinsic rewards like those lead to self-
esteem has appropriately affected employees
motivation. While medical aid and education
benefits are seen the most important component
that affect employees motivation. They
concluded that rewards systems used should be
set based on realistic and reliable standards. The
reward plan exercised should be easily
understood by workers. Employees should be
allowed to participate in the setting of systems
and policies of rewards. A similar research to the
current study is the study conducted by [58]
which aimed to examine the influence of rewards
on workers performance. Subjects consisted of
100 workers of central Bank Nigeria, Abuja. The
selection of subjects was done in such away to
include all categories of workers (senior and
junior staff) and it cuts across gender. Data were
collected through the administration of self
designed questionnaire and SPSS package was
used to test the hypotheses. The findings were
tested at 0.05 level of significance. The results
showed that there existed relationship between
extrinsic rewards and performance of workers,
while no relationship existed between intrinsic
rewards and performance of workers. They
concluded that employers should use their sense
of commitment to put in place appropriate
incentive plans that would encourage workers to
be more purposeful and improve their
performance. The last study reviewed on this
subject is that of. [59] sought to establish the
relationship between intrinsic and different
extrinsic rewards, with intrinsic motivation and
affective commitment. For the sake of collecting
relevant information, across sectional correlation,
study was conducted and self–designed
questionnaires were distributed. Data obtained
from 399 South African employees were
analyzed using correlations and multiple
regressions to test hypotheses. The following
main findings were emerged: Firstly, there is a
relationship between all types of rewards
investigated the outlined variables. Secondly, this
relationship is stronger for intrinsic than for
extrinsic rewards. Thirdly, monetary rewards do
not account for the variance in intrinsic
motivation above that of non –monetary rewards.
The study concluded that, rewards management
should focus on job characteristics and designs,
to increase staff intrinsic rewards and include
non –monetary rewards such as supportive
leadership to encourage employees' intrinsic
motivation and affective commitment. This can
be achieved through different rewards
particularly intrinsic non –monetary rewards.
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2. RESEARCH FRAMEWORK
The research framework in this study is drawn
graphically. It is drawn based on the examination
and understanding of published literature on this
issue. Here it is theorized that each variable of
the rewards types has influence on employees
performance. Fig. 2 shows the research
framework of this study.
3. RESEARCH METHODOLOGY
3.1 Research Design
This study utilized the survey research design
method, and the quantitative approach was used.
Relevant research and studies carried out on this
issue will be used to support the decision of
either acceptance or rejection of stated
hypotheses. The methodology used here is that,
once the decision is made to "accept or reject"
hypotheses based on correlation analysis of
variables, then findings of relevant research and
studies will be stated if in favor with the results of
the current study and furthermore, findings of
relevant research and studies will be stated if
against. A self-designed questionnaire is used to
collect relevant data from the respondents the
logic of using this method is to maintain real life
references and phenomena regarding the effect
of rewards on employees performance. In
addition to that the chosen method is known for
its economies in terms of time and resources.
3.2 Target Population
The target population consist of 513 people, and
it includes all full time employees of the Unified
Mining Companies located in the Southern part
of Jordan (Al-Shedia Phosphate mines). The
target population characteristics is summarized
as shown in Table 1.
3.3 Sample of the Study
From the above target population a sample of
60% of the respondents was selected from within
each company and in proportion that each
company bears to the study population.
According to [60], sampling at least 10% of the
population is acceptable representation of the
population in interest; thus the choice of 60% is
considered a highly representative stratified
sample. Calculation of representative sample is
shown in Table 2.
Fig. 2. Research framework
Table 1. The target population characteristics
Sequence
Companies
name
Population
Percentage
%
1 A 205 40
2 B 165 32
3 C 143 28
Total 513 100
Source: Prepared by researcher 2015
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Table 2. Calculation of representative sample
Sequence
Companies
name
Frequency
Sample
ratio
Sample
size
1 A 205 0.60 123
2 B 165 0.60 99
3 C 143 0.60 86
Total 513 0.60 308
3.4 Research Instrument
Two instruments are used in this study:
3.4.1 Primary data
Through the use of self-designed close ended
questionnaire. This instrument of research is
referred for external judgment to ensure validity
and reliability. The questionnaire is comprised of
five sections:
Section (1): Comprising eight (8) items seeking
demographic data such as gender, age, marital
status, nationality, education, occupational status
or category, experience and income.
Section (2): Consist of ten (10) items which
sought to collect information about the
relationship between extrinsic rewards and
employees performance.
Section (3): Consist of ten (10) items regarding
the perceptions of workers on the relationship
between intrinsic rewards and employees
performance.
Section (4): Contain ten (10) items requesting
information about employees views on the
relationship between social rewards and
employees performance.
Section (5): Contain ten (10) items seeking
information on the perceptions of workers on
rewards mix (extrinsic, intrinsic and social
rewards) and expected relationship with
employees performance. List of Instrument Items
for Sections (2-5) are shown in Table (3).
3.4.2 Secondary data
Include all relevant available data that have been
prepared, collected, and analyzed by others
which include publications, periodicals, essays,
and other relevant documentaries.
3.5 Validity and Reliability
According to research principles an instrument is
valid if it measures what it is intended to measure
and accurately achieves the purpose for which it
was designed. To ensure validity of the
instrument, face, and content; the questionnaire
was given to professionals for judgment,
appropriateness and over all evaluation.
Reliability, on the other hand relates to the
consistency of collected information. In order to
maintain the reliability of the instrument
researcher used a pilot study. It was carried out
on a sample of Sixty (60) employees of Unified
Mining Companies located at Al-Shedia
Phosphate Mines. The result of the reliability test
was 0.837 showing that the instrument is highly
reliable.
3.6 Data Collection
The numbers of questionnaires distributed to the
respondents is 308, which account to 60% of the
total target population of 513 people. The total
number of returned questionnaires is 268. Return
were subjected to a careful checking and 18
questionnaires were excluded and regarded as
unsuitable for statistical analyses because they
do not meet the conditions and criteria of
answering and filling the questionnaires,
therefore, the total number of useable returns is
250. None response is 40 and it was assumed
that the non-respondents were either unwilling to
cooperate or simply are not interested in the
survey. Summary of distributed, returned,
useable, non responses questionnaires are
shown in Table 4.
3.7 Procedures
Questionnaires were distributed to the subjects
on location of their work. Simple instructions and
assistance were given on how to correctly fill in
the questionnaires and confidentiality of
information is assured. The scoring of responses
is carried out as follows:
Section (1): No scores were attached (i.e. bio-
data).
Sections (2-3-4-5): Contain independent and
dependent variables. Respondents were required
to provide their rating on their perception using a
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5-point Likert's Scale Measurement that ranged
from:
1: Strongly Disagree, 2: Disagree, 3: Partially
Agree, 4: Agree, 5: Strongly Agree.
Descriptive Statistics and Person Product
Moment Correlations will be used for data
analyses and testing of hypotheses. For this
purpose, SPSS (Version 16) was used to
implement data analyses.
Table 3. Instrument items for seeking information
Extrinsic rewards Intrinsic rewards
Section Item #
Description Section Item # Description
2
1 Basic payment (wages &
salaries)
3
1 Recognition
2 Contract of employment 2 Achievement
acknowledgement
3 Job promotion 3 Work freedom &
independence
4 Job security 4 Job rotations
5 Performance (Bonus &
awards) 5 Goals setting participation
6 Retirement benefits 6 Appraise & appreciation
7 Compensation & incentives
policies 7 Responsibility & authority
8 Medical allowance 8 Advancement & growth
9 Accommodation &
Transportation allowance 9 Training & skills development
10 Good environment & working
conditions 10 Challenging assignments
Social rewards Rewards mix*
Section Item #
Description Section Item # Description
4
1 Supervisors support
5
1 Pay and recognition
2 Social status 2 Job security & advancement
and growth
3 Caring & supportive attitude 3 Supervisors support & training
and skills development
4 Supportive environment 4 Organizational supportive
structure and culture
responsibility and authority
5 Positive colleagues
relationships
5 Good environment &working
conditions and work freedom
& independence
6 Organizational supportive
structure and culture 6 Compensation & incentives
policies, challenging
Assignments and social status
7 Group belongness and
affiliations 7 Goals setting participation,
positive colleagues
relationships
8 Status symbols 8. Retirement benefits.
recognition and social status
9 Prestige enhancement 9 Responsibility & authority,
social status
10 Off-job social recreation clubs
membership 10 Contract of employment,
advancement & growth and
status symbols
* Note: The list of Rewards Mix is not exhaustive and the researcher suggests that future research can be conducted to
cover all possible combinations of rewards factors. Moreover, it is very important to remember that creativity is needed
when setting and using these types as the bases of rewards. Creativity combined with allowing members' participation
in this process brings forth not only their unique needs and preferences but also their seriousness in developing
effective rewards system
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Table 4. Summary of distributed, returned, useable, non responses questionnaires
Condition
Distributed
questionnaires
Returned
questionnaires
Useable
questionnaires
Non
-
response
Number of employees Number % Number % Number % Number %
308 100 268 87 250 82 40 13
Source: Prepared by researcher 2015
4. DATA ANALYSIS AND MAIN
FINDINGS DISCUSSION
4.1 Respondents Demographic Profile
Table 5 gives the following statistical
demographic indications:
a) With respect to Gender, Table 5 indicates
the allocation of the sample of respondents
from unified mining companies at which
the research was conducted. As can be
seen from the Table above, the whole
sample (250) is 100% male and female
representation is (0). The explanation is
that, the nature of mining jobs do not suit
females and most of these mining
locations are remote from place of
residence. In addition to that, the
Jordanian culture and traditions do not
allow Women to work in male dominated
working environment.
b) With respect to Age, Table 5 indicates that
the majority of participants age is between
31-40 (36%); then comes the age between
41-50(22%); then the age between 21-
30(20.8%); next comes the age less than
20(15.6%). Careful analysis of age
distribution shows that, these companies
prefer to employee young able bodies
because the nature of mining work
requires labor that have stamina and take
the burden of heavy load jobs.
c) With respect to Marital Status, Table 5
indicates that workers are married
189(75.6%); not married 45(18%); and
engaged16 (6.4%). The Classification of
majority of respondents as married has
benefited this study in that, the respondent
took serious interest in the survey by filling
and returning these questionnaires to the
best of their ability because in mind they
have connected this study with potential
increase in financial rewards, which in turn
could cover the rising cost of living in
Jordan.
d) With respect to Nationality, Table 5
indicates that the majority of respondents
were Jordanian citizens 190(76%); while
other nationalities counted for 60(24%).
These percentages indicate that these
companies meet labor law requirements
regarding the employment of citizens and
expatriates.
e) With respect to Education, Table 5
indicates that most respondents had
secondary education is 122 (48.8%);
primary education is 80 (32%); while
minority of the rest of respondents is 48
(19.2%) hold higher degrees ranging from
diplomas to masters. This of course give
clear indication that these kinds of jobs do
not require highly educated people.
f) With respect to Occupational Status, Table
5 indicates that the majority of employees
184(73.6%) are found in the low level of
hierarchy of these companies; doing
ordinary and routine mining jobs assisted
by 12(4.8%) support staff; supervised by
25(10%) supervisors; and managed by
29(11.6%) top and middle management.
These analysis give clear indication that
the type of structure used in these
companies is hierarchal one.
g) With respect to Experience. Table 5
indicates that the majority of employees
110(44%) have between 4-6 years of
experience; 65(26%) respondents have 1-
3 years of experience; 45(18%)
respondents have 7-10 years of
experience and only 30(12%) respondents
have above 10 years of experience.
Analyzing this pattern of experience it give
clear indication that, the experience of
those workers in the mining industry is
limited up to 10 years. This of course is a
match to the age of these miming
companies who have been operating in the
mining industry for not more than 11 years.
h) With respect to income, Table 5 indicates
that the majority of employees 136(54.4%)
earn up to 399(JD) per month; 58(23.2%)
of respondents earn between 400-599 (JD)
per month; 24(9.6%) of respondents earn
between 600-799 (JD) per month;18(7.2%)
of respondents earn between 800-999 (JD)
per month; and finally 14(5.6%) of
respondents earn above 1000 (JD) per
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Table 5. Frequency distribution for respondents demographics
Sequence
Demographic
item
Frequency
Percent
Valid
percent
Cumulative
percent
1
Gender
Male 250 100 100 100
Female - - - -
2
Age
- - - -
less than 20 39 15.60 15.60 15.60
21-30 52 28.80 28.80 36.40
31-40 90 36 36 72.40
41-50 55 22 22 94.40
above 50 14 5.60 5.60 100
3
Marital
status
Married 189 75.6 75.6 75.6
Not married 45 18 18 93.6
Engaged 16 6.6 6.6 100
4
Nationality
Jordanians 190 76 76 76
Syrians 28 11.2 11.2 87.2
Iraqis 13 5.2 5.2 92.4
Sudanese 11 4.4 4.4 96.8
Yemenis 8 3.2 3.2 100
5
Education level
Primary 80 32 32 32
Secondary 122 48.8 48.8 80.8
Diploma 16 6.4 6.4 87.2
Bachelor 22 8.8 8.8 96
H. diploma 6 2.4 2.4 98.4
Masters 4 1.6 1.6 100
6
Occupation
status
CEOs 7 2.8 2.8 2.8
Operation manger 16 6.4 6.4 9.2
HR. mangers 6 2.4 2.4 11.6
Supervisors 25 10 10 21.6
Support staff 12 4.8 4.8 26.4
Other workers 184 73.6 73.6 100
7
Experience
1-3 years 65 26 26 26
4-6 years 110 44 44 70
7-10 years 45 18 18 88
above 10 years 30 12 12 100
8
Monthly
income
Below 399 136 54.4 54.4 54.4
400- less than 599 58 23.2 23.2 77.6
600-less than 799 24 9.6 9.6 87.6
800-lessthan 999 18 7.2 7.2 94.4
above 1000 14 5.6 5.6 100
Total 250 100 100 100
month. Careful insight into these earnings
show that the level of income is still low
compared to the same industry in
neighboring countries; that’s why the
existence of extra rewards might balance out
these difference.
4.2 Reliability Analysis
This part presents the background information of
the respondents; findings of the analysis are
based on the objectives of the study that include
the effect of rewards on employee's
performance. The study targeted a sample size
of 308 respondents and from which 250
questionnaires were considered as relevant for
statistical analysis reaching a response rate of
81%. This response rate was satisfactory to
make conclusions on the effect of rewards on
employees' performance. Furthermore,
Cronbach's Alpha was used to insure internal
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16
consistency of the instrument. For this purpose,
SPSS was used for reliability analysis.
Cronbach's Alpha reliability analysis is shown in
Table 6.
In social science research, a higher value shows
a more reliable generated scale. According to
[61], 0.70 is an acceptable reliability coefficient.
In Table 6, all reliability values are greater than
the prescribed threshold of 0.70 and Cronbach's
Alpha values are compatible to reliability test of
the conducted pilot study, which is equal to 0.
837.
Table 6. Reliability analysis
Scale
Cronbach's
alpha
Number of
items
Extrinsic rewards 0.852 8
Intrinsic rewards 0.831 10
Social rewards 0.822 10
Mix rewards 0.843 10
4.3 Descriptive Statistics
Descriptive Statistics in the form of means and
standard deviations for independent variables
were computed and presented in Table 7.
a) From the findings on the influence of
extrinsic rewards on employees
performance, the study showed the
following order of importance for factors of
extrinsic rewards: Firstly, comes medical
allowance; with a mean of 4.42; secondly,
comes basic payment (wages &salaries),
with a mean of 4.41, thirdly, comes good
environment &Working Conditions with a
mean of 4.23, fourthly, comes Retirement
Benefits, with a mean of 4.18, fifthly,
comes performance(bonus &awards), with
a mean of 3,99; sixthly, comes job security,
with a mean of 3,98; seventhly, comes
compensation & incentives policies, with a
mean of 3.97; eighthly, comes contract of
employment, with a mean of 3.89; ninthly,
comes accommodation & transportation
Allowance, with a mean of 3.82 and finally,
comes Job Promotion, with a mean of
3.65. The study, found that, the majority of
the respondents agreed that, medical
allowance has deep influence on
employees performance because the cost
of medical treatment in Jordan is very high
compared to earned levels of income.
b) From the findings on the influence of
intrinsic rewards on employees
performance, the study found the following
order of importance for factors of intrinsic
rewards: Firstly, comes recognition, with a
mean of 4.34; secondly, comes appraise &
appreciation, with a mean of 4.02; thirdly,
comes work freedom& independence with
a mean of 3.89; fourthly, comes
advancement & growth, with a mean of
3.81; fifthly, comes training & skills
development, with a mean of 3.79; sixthly,
comes achievement acknowledgement,
with a mean of 3.65; seventhly, comes
challenging assignments, with a mean of
3.61; eighthly, comes goals setting
participation, with a mean of 3.56; ninthly,
comes job rotations, with a mean of 3.52;
and finally, comes responsibility &
authority, with a mean of 3.45. The study,
found that, the majority of the respondents
indicated that these companies showed
recognition and appreciation which
affected employees feel sense of
satisfaction and hence increased their
performance. Development on personal
and professional grounds were regarded
as strong motivator; therefore, these
companies should concentrate on these
issues. Lastly, mining companies should
reconsider modifying their structure to
allow for more room to allow for increased
levels of responsibility & authority.
c) From the findings on the influence of social
rewards on employees performance, the
study found the following order of
importance for factors of social rewards:
Firstly, comes supervisors support, with a
mean of 3.96; secondly, comes social
status, with a mean of 3.67; thirdly, comes
status symbols, with a mean of 3.66;
fourthly, comes group belongness and
affiliations, with a mean of 3.62; fifthly,
comes caring & supportive attitude, with a
mean of 3.57; sixthly, comes supportive
environment, with a mean of 3.55;
seventhly, comes positive colleagues
relationships, with a mean of 3.52;
eighthly, comes organizational supportive
structure and culture, with a mean of 3.46;
ninthly, comes prestige enhancement, with
a mean of 3.45; and finally, comes off-job
social recreation clubs membership, with a
mean of 3.32. The study, found that, the
majority of the respondents indicated that,
good supportive relationships with
immediate supervisors acted as motivator
and hence has immediate impact on
employees performance. However, the
social well being of employees was seen
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17
as influential important factor with a
considerable affect on performance. This
direction goes in line with modern human
resource research; based on that, there is
a call for more socialization through social
meetings which make people open
towards others and hence build up a
positive and a productive personality.
Table 7. Rates of rewards types on employees performance
Extrinsic
rewards
Intrinsic
rewards
Section
Description
Mean
SD
Section
Description
Mean
SD
2
Basic payment (wages &
salaries) 4.41 .23
3
Recognition 4.34 .21
Contract of employment 3.89 .16 Achievement
acknowledgement 3.65 .19
Job promotion 3.65 .15 Work freedom &
independence
3.89 .17
Job security 3,98 .19 Job Rotations 3.52 .16
Performance (Bonus &
awards) 3,99 .20 Goals setting
participation 3.56 .15
Retirement benefits 4.18 .21 Appraise & appreciation 4.02 .20
Compensation &
incentives policies 3.97 .18 Responsibility &
authority 3.45 .14
Medical allowance 4.42 .24 Advancement &growth 3.81 .19
Accommodation &
transportation allowance
3.82 .17 Training & skills
development 3.79 .17
Good environment &
working conditions 4.23 .22 Challenging
assignments 3.61 .18
Social
rewards
Rewards
mix
Section
Description
Mean
SD
Section
Description
Mean
SD
4
Supervisors support 3.96 .20
5
Pay and recognition 4.46 .23
Social status 3.67 .18 Job security &
advancement and
growth
4.22 .20
Caring & supportive
attitude 3.57 .15 Supervisors support &
training and skills
development
3.80 .17
Supportive environment 3.55 .14 Organizational
supportive structure and
culture responsibility and
authority
3.54 .16
Positive colleagues
relationships 3.52 .16 Good environment
&working conditions and
work freedom &
independence
4.01 .19
Organizational
supportive structure
and culture
3.46 .17 Compensation &
incentives policies,
challenging assignments
and social status
3.89 .18
Group belongness and
affiliations 3,62 .17 Goals setting
participation, positive
colleagues relationships
3.78 .17
Status Symbols 3.66 .18 Retirement benefits.
Recognition and social
status
4.21 .20
Prestige enhancement 3.45 .15 Responsibility &
authority, social status 3,65 .18
Off-Job social recreation
clubs membership 3.32 .14 Contract of employment,
advancement & growth
and status symbols
3.66 .19
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d) From the findings on the influence of
rewards mix on employees performance,
the study indicated the following order of
importance for factors of rewards Mix:
Firstly, comes pay and recognition, with a
mean of 4.46; secondly, comes job
security & advancement and growth, with a
mean of 4.22; thirdly, comes retirement
benefits. recognition and social status, with
a mean of 4.21; fourthly, comes good
environment &working conditions and work
freedom& independence, with a mean of
4.01; fifthly, comes compensation &
incentives policies, challenging
assignments and social status, with a
mean of 3.89; sixthly, comes supervisors
support & training and skills development,
with a mean of 3.80; seventhly, comes
goals setting participation, positive
colleagues relationships, with a mean of
3.78; eighthly, comes contract of
employment, advancement & growth and
status symbols, with a mean of 3.66;
ninthly, comes responsibility & authority,
social status, with a mean of 3.65; and
finally, comes organizational supportive
structure and culture responsibility and
authority, with a mean of 3.54. The study,
found that, the majority of the respondents
responses indicated that, strong
association between financial and non-
financial rewards in the form of pay and
recognition which in turn reveals that
people want money and respect if they are
to increase their performance. In addition
to that security, advancement and growth
are very important factors that determines
the level of performance. Finally, the
maintenance of good social status goes
beyond employment period to include the
retirement stage. All said to have crucial
impact on employees overall performance.
Descriptive Statistics in the form of overall
means and standard deviations for both
independent and dependent variables for the
respondents were computed and presented in
Table 8.
Table 8 shows that the means for reward types
ranged from a low value of 2.498 to a high value
of 4.054. Results of descriptive Statistics reveal
that the rewarding of employees is relatively
good. As can be seen from Table 8 the mean for
the entire independent variables are relatively
high, and are a above the mean value of the
dependent variable (in this case employees
Performance) Expressed in figures 4.054 , 3.430,
3.578, 3.922 >2.498; this indicates that over all
employees Performance is well because
employees are satisfied with rewards they
receive.
Table 8. Over all means for rewards category
and employees performance
Variables
Means
Standard
deviations
Employees performance 2.498 .130
Extrinsic rewards 4.054 .195
Intrinsic rewards 3.430 .176
Social rewards
3.578
.163
Mix rewards 3.922 .187
4.4 Pearson Correlation Coefficient
Pearson's correlation coefficient (r) is a measure
of the strength of the association between the
two variables. According to the common practice
used in research studies that normally include
several variables, beyond knowing the means
and standard deviations of the dependent and
independent variables, the researcher would
often like to know how one variable is related to
another. While correlation could range between -
1.0 and+1.0, the researcher need to know if any
correlation found between two variables is
significant or not (i.e.; if it has occurred solely by
chance or if there is a high probability of its
actual existence). As for the information, a
significance of p=0.05 is the generally accepted
conventional level in social sciences research.
This indicates that 95 times out of 100, the
researcher can be sure that there is a true or
significant correlation between the two variables
and there is only a 5% chance that the
relationship does not truly exist. The correlation
matrix between dependent variable and
independent variables are exhibited in Table 9.
As shown in Table 9, all four dimensions have
significant correlation with employees'
performance. The highest coefficient of
correlation in this study was between extrinsic
rewards and employees' performance. There
was a significant positive relationship between
extrinsic rewards and employees performance (r
=.592, p<0.01). The second highest correlation
was between Intrinsic rewards and employees
performance (r =.553, p<0.01) and the third
highest correlation was found between social
rewards and employees performance (r =.497,
p<0.01) and finally, high correlation was noticed
between towards mix and employees
Salah; BJEMT, 13(4): 1-25, 2016; Article no.BJEMT.25822
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Table 9. Dimension correlations rewards and employees performance
Variables Employees'
performance Extrinsic
rewards Intrinsic
rewards Social
rewards Rewards mix
Employees'
performance 1.00
Extrinsic Rewards .592 1.00
Intrinsic Rewards .553 .549 1.00
Social Rewards .497 .589 .567 1.00
Rewards Mix .459 .566 .568 .557 1.00
Table 10. Coefficients table
Variables
Un
standardized
coefficients
Standardized
coefficients
t Sig.
Beta Std. error Beta
Constant .560 .470 3.523 .000
Extrinsic Rewards .495 .135 2.143 .043
Intrinsic Rewards .454 .133 1.971 .036
Social Rewards .325 .146 1.876 .033
Rewards Mix .486 .130 2.867 .041
performance (r =.459, p<0.01). In other words,
the results indicate that all four variables have
significant correlation with Employees
performance.
4.5 Regression Analysis
Regression equation is Y=
.560X1+.495X2+.454X3+.325X4+.486X5
From the above regression equation it was found
that holding extrinsic rewards, intrinsic rewards,
social rewards and rewards mix to a constant
zero, employees' performance will be 0.560, a
unit increase in extrinsic strategies would lead to
increase in employees performance by 0.495
units, a unit increase in intrinsic rewards would
lead to increase in employees performance by
0.454 units, a unit increase in social rewards
would lead to increase in employees
performance by 0.325 units and a unit increase
in rewards mix would lead to increase in
employees performance by 0. 486units. Extrinsic
rewards had the greatest effect on employees
performance, followed by rewards mix, then
intrinsic rewards while social rewards had the
least effect on employees performance. At 5%
level of significance and 95% level of confidence,
extrinsic rewards had a 0. 043 level of
significance; intrinsic rewards had a 0.036 level
of significance, social rewards had a 0.033 level
of significance while rewards mix had 0.041 level
of significance. Hence the sequence of the most
significant factors is extrinsic rewards, rewards
mix, intrinsic rewards and social rewards All the
variables were significant (p<0.05).
4.6 Hypotheses Testing and Results
For hypotheses testing, Pearson Product
Moment Correlation Coefficient is used for
analysis and interpretation of results.
Hypotheses 1: The first hypotheses states that:
Ho: There is no significant direct relationship
between extrinsic rewards on employees'
performance.
H1: There is significant direct relationship
between extrinsic rewards on employees'
performance.
Results Discussion: Table 9 (a) shows that,
value at 0.05 significant level with degree of
freedom 98 is 0.197. From calculations and
indications r > tv (i.e. 0.480 > 0.197). Since
calculated value is (0.480) is greater than the
table value (0.197), the result is significant.
Decision: According to the above analysis the
null hypotheses (Ho) is rejected and the
alternative hypotheses (H1) is accepted, that is
there is significant/direct relationship between
extrinsic rewards on employees' performance.
This implies that, an increase in extrinsic rewards
like salaries; cash bonus, allowances of various
types given to employees will lead to a
correspondent increase in their performance.
The justification for this result is that, most
people, including the workers of these mining
firms regard extra money received in the form of
salaries, cash bonus, allowances of various
Salah; BJEMT, 13(4): 1-25, 2016; Article no.BJEMT.25822
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types as one of the most important factors that
encourage them to work harder and hence push
them to improve their performance.
Hypotheses 2: The second hypotheses states
that:
Ho: There is no significant direct relationship
between intrinsic rewards on employees'
performance.
H2: There is significant direct relationship
between intrinsic rewards on employees'
performance.
Results Discussion: Table 9 (b) shows that,
value at 0.05 significant level with degree of
freedom 98 is 0.197. From calculations and
indications r > tv (i.e. 0.450 > 0.197). Since
calculated value is (0.450) is greater than the
Table value (0.197), the result is significant.
Decision: According to the above analysis the
null hypotheses (Ho) is rejected and the
alternative hypotheses (H1) is accepted, that is
there is significant/direct relationship between
intrinsic rewards on employees' performance.
This implies that, an increase in intrinsic rewards
like appreciation, recognition and praise and so
on, given to employees will lead to a
correspondent increase in their performance.
The justification for this result is that, workers of
these miming companies consider appreciation,
recognition and praise and so on as important
factors that encourage them to work harder
which is reflected in the form of increased
performance.
Hypotheses 3: The third hypotheses states that:
Ho: There is no significant direct relationship
between social rewards on employees'
performance.
H3: There is significant direct relationship
between social rewards on employees'
performance.
Results Discussion: Table 9 (c) shows that,
value at 0.05 significant level with degree of
freedom 98 is 0.197. From calculations and
indications r > tv (i.e. 0.422 > 0.197). Since
calculated value is (0.422) is greater than the
table value (0.197), the result is significant.
Decision: According to the above analysis the
null hypotheses (Ho) is rejected and the
alternative hypotheses (H1) is accepted, that is
there is significant/direct relationship between
social rewards on employees' performance. This
implies that, an increase in social rewards like
supervisors' support and good relations with
colleagues given and felt by the employees will
lead to a correspondent increase in their
performance. The justification for this result is
that, workers of these miming companies
consider social rewards in the form of
supervisors support and good relations with
colleagues given and felt by the employees as
important factors that encourage them to work
harder which is reflected in the form of increased
performance.
Hypotheses 4: The fourth hypotheses states
that:
Ho: There is no significant direct relationship
between rewards mix (extrinsic, intrinsic and
social rewards) on employees' performance.
H4: There is significant direct relationship
between rewards mix (extrinsic, intrinsic and
social rewards) on employees' performance.
Results Discussion: Table 9 (d) shows that,
value at 0.05 significant level with degree of
freedom 98 is 0.197. From calculations and
indications r > tv (i.e. 0.413 > 0.197). Since
calculated value is (0.413) is greater than the
table value (0.197), the result is significant.
Table 11. Correlation between extrinsic rewards, intrinsic rewards, social rewards, rewards mix
and employees performance
Correlation R tv df Sig level
Rewards types
a) Extrinsic rewards and employees performance 0.480 0.197 98 0.05
b) Intrinsic rewards and employees performance 0.450 0.197 98 0.05
c) Social rewards and employees performance 0.422 0.197 98 0.05
d) Rewards mix and employees performance 0.413 0.197 98 0.05
Salah; BJEMT, 13(4): 1-25, 2016; Article no.BJEMT.25822
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Decision: According to the above analysis the
null hypotheses (Ho) is rejected and the
alternative hypotheses (H1) is accepted, that is
there is significant/direct relationship between
rewards mix on employees' performance. This
implies that, the existence of rewards mix (or
diverse rewards systems) will lead to an increase
in employees performance. The justification for
this result is that, workers of these miming
companies consider rewards mix (or diverse
rewards systems) as important factors that
encourage them to work harder which is reflected
in the form of increased performance.
4.7 General Discussion of Results
The acceptance of the first hypothesis indicate a
significant relationship between extrinsic rewards
and employees' performance, which means that,
extrinsic rewards received by employees have
significant impact on their performance. This
goes in line with [62] work in which concluded
that, extrinsic financial rewards given to
employee s will boost quality of performance.
The findings of this study agree with the work of
[63], which showed that, subjects who received
individual incentives performed better than those
who did not receive incentives; and workers
exhibited productive work behavior when
rewards were made contingent upon
performance. However, other studies had
corrupted the present findings, for example the
work of [64] states that, extrinsic rewards are
counterproductive because performance cannot
be measured accurately and is influence by
factors beyond employees' control; and
according to them the case against monetary
rewards is made by quality leaders where two
lines of argument appear: First, it states that
money is a poor motivator. Second, it maintains
that numerical measures of performance are
flawed and therefore must not be tied to rewards.
A support for this argument is found in the work
of [65], where the study came as a corruption to
the present study. Here it was observed that poor
remuneration in relation to profits made by
organization, wage differentials between high
and low income earners among other things
contribute to low morale, lack of commitment and
low productivity. The acceptance of the second
hypothesis indicated a significant relationship
between intrinsic rewards and employees
performance; that is intrinsic rewards given to
employees has significant influence on
employees' performance. In line with this result,
is the work of [66], which claimed that intrinsic
rewards for example, showing recognition,
expressing of appreciation and
acknowledgement of achievement and soon
have a significant influence on employees results
and performance. Further agreement with this
study is the work of [67] in which he emphasized
the great importance of intrinsic rewards in
influencing workers performance. The
acceptance of the third hypothesis indicated a
significant relationship between social rewards
and employees performance; that is social
rewards have a significant influence on
employees performance. However, more in
depth studies need to be conducted to explore
the extent of social rewards on employees
performance. The acceptance of the fourth
hypothesis has indicated a significant
relationship between rewards mix and
employees performance, that is rewards mix has
a significant influence on employees
performance. Unfortunately, majority of research
studies on reward programs and their evaluation
tend to focus on a limited number of specific
types of rewards given to employees. In line with
present findings, is the work of [68] in which he
encountered a positive interaction between
different multiple elements of rewards mix on
employees performance.
4.8 Practical Applications of Findings
Its hoped that this study will have important
practical implications for all those interested in
the subject of reward systems management in
particular (employers and employees). This
research emphasized the importance of fine –
tuning and aligning reward systems to ensure
employees satisfaction and at the same time
reaching better levels of performance. Fine-tuned
reward systems should be diverse, fair, flexible
and has added value to the parties of the
organization. In real life situations, management
should set reward systems and programs that
link the type of rewards given to performance
results; thus the higher the rewards perceived by
employees, the greater the satisfaction towards
the organizational policies and strategies leading
to greater productivity as a result of improved
performance. This study contributes to the body
of literature by investigating all possible set of
reward factors that would affect employees
performance; that is the study investigated
extrinsic, intrinsic, social and rewards mix,
therefore, management of organization could
benefit from the findings of this research by
implementing its recommendations to their
organization. The findings of this research
proved that all types of rewards are instrumental
Salah; BJEMT, 13(4): 1-25, 2016; Article no.BJEMT.25822
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in shaping people results and performance,
therefore, reward strategies should reinforce
these people results. In addition to that, it's
hoped that, the findings of this study can be used
as a practical handy tool in providing practical
solutions to issue of conflicts, that have resulted
from the existence of poor reward systems or the
ineffective management of reward systems.
5. CONCLUSION
Human resources are valuable assets of
organizations and they constitute critical
component of strategic success across all types
of organizations. Highly rewarded employees,
tend to be highly satisfied well performing
employees; they also tend to remain longer with
the organizations and that would lead or increase
competitive edge. Going by the findings of this
study a positive significant relationships have
existed between (extrinsic, intrinsic, social and
reward mix) and employees performance;
therefore, the issue of rewarding employees
using all possible types of rewards matters a lot
and should never be neglected by management
of the organizations because deliberate
ignorance of rewarding needs will lead to non
motivated, non committed staff with poor
performance.
6. RECOMMENDATIONS
Since the relationship between rewards and
employees performance is considered to be
strong, then that should alarm management to be
more committed regarding the setting of
appropriate incentive plans because that will
encourage employees to be more purposeful and
hence increase their performance. It is also
recommended that there should be a consistency
between firms overall strategies and the reward
package that is given to employees. Adherence
and parallelism between organization's strategies
and reward packages and programs will lead to
the achievement of concerned parties mutual
goals and objectives. In order to maintain
consistency of interests and goals; it is
recommended that management should modify
their reward program on a regular basis.
Modification should be done in corporation with
employees representative bodies to ensure
meeting mutual goals and objectives. Finally, it is
recommended that knowledge building should be
implemented continuously in order to allow for
variations in needs and expectations of both
employers and employees; not only in the aspect
of rewarding employees, but also in all other
aspects that may have significant influence on
employees performance.
7. LIMITATIONS OF THE STUDY
Similar to other research studies, this study has
the following prominent limitations: Firstly, the
measurement of study variables and their effect
on performance are all based on respondents
perceptions and attitudes while filling the
questionnaires. Thus, errors might exist in the
data set. Secondly, the study covered three
mining companies in the private sector, so if
findings of this study to be generalized, then
different sectors like manufacturing, finance, and
public sector firms should be researched to get
more updated and valuable contributions
regarding the effect of rewards systems on
employees performance. Thirdly, the
findings of this study is applicable only to smaller
to medium sized organizations, therefore, the
present findings cannot be generalized to a
bigger organizations. Fourthly, despite the fact
that the literature search was extensive,
potentially valuable studies may not have been
included and the selection of literature sources
may have elements of bias and subjectivity.
Finally, more future research should be
conducted to explore the distinction between
different forms of extrinsic, intrinsic and social
rewards; and across different sectors and across
different cultures, so that, more complete and
thorough understanding of the effect of different
rewards programs on people results can be
achieved.
COMPETING INTERESTS
Author has declared that no competing interests
exist.
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_________________________________________________________________________________
© 2016
Salah; This is an Open Access article distributed under the terms of the Creative Commons Attribution License
(http://creativecommons.org/licenses/by/4.0), which permits unrestricted use, distribution, and reproduction in any medium,
provided the original work is properly cited.
Peer-review history:
The peer review history for this paper can be accessed here:
http://sciencedomain.org/review-history/14725
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