When it comes to performance related pay, commentary often focuses on the positive effects it can have on employee and organizational performance. But is there a downside? A Finnish study sought to investigate the role that pay for performance can have on employee innovation. The results indicated that reward for innovation related behaviours can stunt radical innovation, while it can have a moderate positive effect on incremental innovation.
Key Topics: Performance related pay; Innovation
When it comes to eliciting the best from their employees, companies are increasingly moving toward pay for performance reward strategies, which focus on rewarding employees’ job skills, knowledge, competencies and productivity. A recent Malaysian study sought to understand factors influencing perceived unfairness of such reward practices and found that elements such as effective communication, participation, and performance appraisals can have a significant impact on perceived fairness by employees.
Key Topics: Job satisfaction, Performance appraisal, Performance based reward
Does employee compensation level influence their future treatment by organizations? A recent study examining players in the NFL sought to understand if players in which organizations had made a greater financial commitment received preferential treatment through more game time. The results indicated that higher compensated players did receive more game time but were no more productive on the field that than their lower compensated colleagues, suggesting that their additional game time was related to bias due to the investment the team had made in them.
Key Topics: Compensation bias; Employee performance
Companies have more tools at their disposal now than ever before to elicit improved employee performance, but are the basics of meaningful work being forgotten? A study of Chinese administrative workers sought to examine the importance of job meaningfulness to workers, as well as both financial and recognition incentives on employee performance. All three factors were found to positively impact performance, with meaning found to be most significant in eliciting the greatest performance gains. These factors were also found to interact with each other in interesting ways.
Key Topics: Job meaning; Financial rewards; Recognition; Employee performance
With companies constantly striving for competitive advantage, continued innovation is central to the success of many companies. A Chinese study examined innovative employee behavior across multiple industries and the role of contextual and dispositional factors in this behavior. The study found that innovation job requirements and employee intrinsic interest in innovation had a significant impact on employee innovative behavior, and furthermore that reward could play an important role in eliciting innovative behavior.
Key Topics: Perceived innovation job requirement; Innovative behavior; Intrinsic interest in innovation; Rewards
Short-term bonuses have become prevalent in the workplace, with companies seeing them as valuable tools in engaging and motivating employees. A study in the high-tech manufacturing sector, examined the role of three types of bonuses (cash, family meal voucher, and verbal reward) in employee performance and absenteeism. All bonus types were found to increase performance and decrease absenteeism rates, although key differences in effects were found across the three types of bonuses.
Key Topics: Non-monetary rewards; Short-term bonuses; Employee performance; Absenteeism
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