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Use of Intrinsic and Extrinsic Rewards on Improving Job Performance in an Organization

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Use of Intrinsic and Extrinsic Rewards on Improving Job Performance in an Organization
Universiti Malaya
Faculty of Business And Accountancy
Master of Business Administration
Semester 2, Session 2012/2013

CSGB6101 Human Capital Management
Group Assignment

Title:
The Use of Intrinsic and Extrinsic Rewards on Improving Job Performance in an Organization

Date of Submission:
18 May 2013
Word Count:

Introduction
In the world of rapid changing environment and globalization, for an organization to compete favourably and competitively, the performance of their employees goes a long way in determining the success of an organization (Ajila and Abiola 2004). Both public and private sectors organizations are putting increasing attention on human resource management to maintain and motivate its most valuable and worthy assets, the employees. According to Catalini
(2012), organizations are taking more of a proactive stance towards ensuring employees are satisfied with their place of employment and feel a level of commitment and connection to employers. Back then, employee satisfaction is often not a primary focus of an employer.
Organizations routinely focus on finances, production, and pleasing customers and neglect the impact their actions or lack of action has on employee satisfaction. The consequences may be seen in products or services that are not up to standards and an increase in turnover and increase in cost for employers. Hence, finding the right balance between employee satisfaction and its enhancement of employee motivation and performance is imperative as it will have positive effects on several aspects of an organization, including lowering turnover rates and increasing productivity and profit.

The use of rewards has been found over the years to be one of the management tools in the organization to increase job performance. Besides, it is common to offer employees attractive, lucrative and competitive remuneration packages. For example, an attractive reward packages has been a norm of any employment



References: Ajila, C.O. 1997. Job Motivation and Attitude to Work as Correlates of Productivity Among Workers in Manufacturing Companies in Lagos State Allen, R.S., & Kilmann, R.H. (2001a). The Role of the Reward System for a Total Quality Management Based Strategy, Journal of Organizational Change Management, 14 (2), 110 127. Bamberger, P.A., & Levi, R. (2009). Team - Based Reward Allocation Structures and the Helping Behaviors of Outcome - Interdependent Team Members, Journal of Managerial Bergum, B. and Lehr, J. (1984). “Monetary incentives and Vigilance.” Journal of Experimental Psychology, No Bounds, Gregory M., Dobbins, Gregory H., Fowler, Oscar L. (1995) Management: A Total Quality Perspective, South-Western College Publishing, Cincinnati, Ohio Daniel and Caryl. (1981). Exchange variables as predictors of job commitment and turnover. Eisenberger, R., & Rhoades, L. (2001). Incremental effects of reward on creativity. Journal of Personality and Social Psychology, 81, 728–741. Hsieh, Y.H., Chen, H.M., (2011) Strategic fit among business competitive strategy, human resource strategy and reward system Howard, Larry, W. & Dougherty, T.W. (2004). Alternative Reward Strategies and Employee Reactions, Compensation and Benefits Review, 36, 41 - 51. 10. Jenkins, G., Gupta, M., Mitra, A., & Shaw, J. (1998). Are financial incentives related to performance? A meta-analytic review of empirical research 11. Kulkarni, P. (1983). Organizational Behaviour and Human Decision Processes. New Delhi: McCoy Hill. 12. Lawler, E.E. (1985). “The effects of performance of job satisfaction.” Industrial Relations,7: 20-28. 13. Mahaney, R.C., Lederer, A.L. (2006). The Effect of Intrinsic and Extrinsic Rewards for Developers on Information Systems Project Success, Project Management Journal, 37 (4), 14. Mansor, M.F., Borhannudin, S.N., Mohd Yusuf, B.N., (2012). The effect of rewards towards job performance among chemical-based employees 16. Mickel, A., & Barron, L. (2008). Getting “more bang for the buck”: Symbolic value of monetary rewards in organizations 17. Nabiha, A.K., Thum, W.Y., Sardana, G.D. (2012), A case study of service desk 's performance measurementsystem 19. Thomas, K. (2009). The four intrinsic rewards that drive employee engagement, Ivey Business Journal Ajila, C., and Abiola, A. (2004). Influence of Rewards on Workers Performance in an Organization,

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