Human Resource Management: Reward Systems and Employee Motivation

This literature review examines the critical role of Human Resource Management (HRM) in ensuring employee job satisfaction, which is vital for organizational success. It highlights the importance of reward systems and motivation as key factors in enhancing employee performance and organizational citizenship. While financial rewards are significant, the review emphasizes that they should not be the sole source of motivation. A balanced approach, incorporating recognition and appreciation for all employees, is necessary for sustaining long-term motivation and achieving organizational goals. The review references studies that support the positive impact of reward systems on employee productivity but also cautions against over-reliance on financial incentives, advocating for a more holistic approach to employee motivation within HRM.

Running head: HUMAN RESOURCE MANAGEMENT
Human resource management
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1HUMAN RESOURCE MANAGEMENT
Literature Review
It is one of the universal fact that employees are a significant asset to any organisation
or a company. Therefore, the success rate of any organisation is depended upon the
employees working for that particular organisation. Therefore providing job satisfaction to
employees is one of the key objective of the Human Resource Management (HRM) of any
organisation. In the case study provided, the organisation tends to suffer from financial loss
due to the lack of productivity level among employees. The lack of recognition or reward
seem to demotivate the employees and as a result have a negative effect on the employees’
performance. It is observed that reward system and motivation are two significant variables
that plays a vital role in accelerating job satisfaction among employees for the purpose of
enhancing organisational citizenship (Arokiasamy, Tat & bin Abdullah, 2013). In addition to
this, it has also been observed that organisations that tend to establish reward system in their
organisation show higher success level in the competitive market as there are higher level of
job satisfaction among employees that ultimate results in higher performance level from them
(Yamoah, 2013).
Paying for the productivity of employees has been the base of industrial and
organisational development. Financial reward in the form of salary, bonus and others plays a
significant role in managing employees’ performance. It has been observed that the reward
system influences performance by appreciating and rewarding those who deliver good
performance and by offering incentives to improve it (Malik, Butt & Choi, 2015).
Henceforth, for the purpose of keeping up the good performance flow from the employees of
an organisation, reward system helps the HRM to a great extent. However, in contrary to this,
it is observed that reward system may have its downside as it is observed that reward or
incentive acts as the only form of motivation for employees to deliver a good performance

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(Appelbaum, 2013). While money can be regarded as one of the aspects of motivation for
employees, however, it cannot be the only form of motivation. The employees need to be
provided with other forms of motivation as well apart from financial rewards that could
enhance their productivity for the long run (Aguinis, Joo & Gottfredson, 2013). Organisations
that tend to enhance the productivity of employees with the help of reward system only can
fail to maintain the performance status of employees for the long run, as they may not remain
a motivation factor for employees for a long run.
Henceforth, it can be said that while reward system acts as one of the significant
aspect in increasing the productivity and motivation of employees, however, it should not be
the only form of motivation. The HRM has to practice an equal balance in order to keep the
motivation among the employees high that would ultimately result in fulfilling the
organisations goals and objectives. Reward system are a great way to appreciate the
employees for their good performance, however, other employees must also be recognised for
the amount of productivity they put into an organisation to run. Each employee of an
organisation acts as an asset and therefore, the HRM has the responsibility to provide
satisfaction and motivation among every worker.

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References
Aguinis, H., Joo, H., & Gottfredson, R. K. (2013). What monetary rewards can and cannot
do: How to show employees the money. Business Horizons, 56(2), 241-249.
Appelbaum, E. (2013). The impact of new forms of work organization on workers. Work and
Employment in the High Performance Workplace, 120.
Arokiasamy, A. R. A., Tat, H. H., & bin Abdullah, A. G. K. (2013). The effects of reward
system and motivation on job satisfaction: evidence from the education industry in
Malaysia. World Applied Sciences Journal, 24(12), 1597-1604. doi:
10.5829/idosi.wasj.2013.24.12.13294
Malik, M. A. R., Butt, A. N., & Choi, J. N. (2015). Rewards and employee creative
performance: Moderating effects of creative self‐efficacy, reward importance, and
locus of control. Journal of Organizational Behavior, 36(1), 59-74. doi:
10.1002/job.1943
Yamoah, E. E. (2013). Relationship between compensation and employee
productivity. Singaporean Journal of Business, Economics and Management
Studies, 51(1115), 1-5. doi: 10.12816/0003845