Impact of Financial and Non-financial Rewards on Employee Motivation Literature review

Impact of Financial and Non-financial Rewards on Employee Motivation and Satisfaction of Saudi Nationals in Saudi Aramco - Literature review Example A predominant means for accomplishing human-resource-based competitive advantages is the use of incentives. Performance-related pay and benefits are some common incentives in the financial sector, as well as other industries. Lewis offers a process-cycle theory, where the stages of PRP must be properly managed in order to deliver optimal performance results. These stages are: 1) establishing objectives; 2) measuring performance; 3) providing performance feedback; and 4) translating performance into rewards. His study shows that incentives can greatly affect performance, when these stages are aptly managed in relation to employees’ performance levels and issues. Ferreira, Marques and Azevedo show from their study of Portuguese banks that incentive systems shape organisational competitiveness, although other factors are also important, such as management and leadership approaches. PRP per se is not the magic bullet of performance, especially when it has design and implementation flaws. (Boachie-Mensah and Dogbe, 2011). Financial incentives and performance Financial incentives alone are not enough to drive motivation and performance because employees consider other factors too (Siders, George and Dharwadkar, 2011). In the study of 139 Slovenian bank managers, Hartmann and Slapnicar (2012) explored the effect of distributive justice properties and procedural justice properties of managerial pay on manager’s intrinsic motivation. They discovered that procedural justice is a greater predictor of intrinsic motivation when low pay transparency exists, while distributive justice is a greater predictor of motivation when high pay transparency is present. Hartmann and Slapnicar (2012) concluded that pay transparency is important in analysing and designing just managerial pay