Description
Motivation is a psychological feature that arouses an organism to act towards a desired goal and elicits, controls, and sustains certain goal-directed behaviors.
Association between Reward and Employee motivation: A case study Banking Sector of Pakistan
Malik Muhammad Shafiq* Muhammad Saqlain Raza‡ Maira Mariam†
* †
[Corresponding Author], [MBA(HR), The University of Lahore, Pakistan], [[email protected]] [MBA, Lahore College for Women, Pakistan], [[email protected]] ‡ [MBA, The University of Lahore, Pakistan], [[email protected]]
© 2011.Malik M. S., Maria M., & Muhammad S. R. This is a research/review paper, distributed under the terms of the Creative Commons Attribution-Noncommercial 3.0 Unported License http://creativecommons.org/licenses/by-nc/3.0/, permitting all non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited. Special Issue Theme: “Planning, Policies & Global Issue” © JournalsBank.com (2011). ISSN 2220-9425
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
Association between Reward and Employee motivation: A case study Banking Sector of Pakistan§
Malik Muhammad S., Maira Maria, & Muhammad Saqlain R.
Abstract This study seeks to association between reward and employee motivation and also identify associations between employee motivation and employee demographics variables like (gender, age, and education and income level and job experience) in banking sector of Pakistan. The study is based on primary data and sample Size (N= 226) consisted of male and female employees of 21 different banks. Primary data collected by structured questionnaire by using sort of different approaches and this study was survey base. Two different hypotheses were developed for the present study and were tested by applying Chi-square Test and binary Regression Test. The result of Chi-square shows that P- value is 0.048 of Chi-square its mean there is association between salary and gender. The correlation between rewards and Employee Motivation is 0.546, which shows the positive relationship between reward and employee motivation. The estimated regression model revealed that when reward is increased by one unit then motivation increased by 0.527 units, so we can say that rewards is directly proportional to employee motivation and employee motivation depends on rewards. The results also showed that salary is a very important factor for employee motivation as compared to other variables like promotion, job security, working condition, appreciation and other benefits. Keywords: Reward system, motivation, employee, banks, Human Resource Management
§
Acknowledgment Nil
© JournalsBank.com (2011).
ISSN 2220-9425
166
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
I.
Introduction
as pension, health insurance, bonus, promotion, working conditions, training and good environment that you get from being employed. There are two types of reward system, one is financial rewards (salary, bonus, commission, incentives) second is non financial rewards (promotion, opportunity to completion, training, skills, meaningful work and work kind condition). Roberts (2005) discuss that organizations are under constant pressure to enhance and improve their performance and are realizing that relationship performance exists and between employee
Bank refer to a corporation empowered to deal with cash, domestic, foreign, and receive deposits of money and loan those monies to third parties”. There are about 40 banks operating in Pakistan 1Government Banks (National Banks of Pakistan, State Bank of Pakistan and Bank of Punjab), 2Commercial Banks like (Muslim Commercial Bank, Mezan Bank, Bank Alfalah, Habib
Metropolitan Bank, Standard Charted Bank etc). The banks play important role in economy of any country and also worldwide economy and banks employees are the best sources of delivering good services to their customers. Excellent services provided and offered by employees can create a positive perception and ever lasting image in the eyes of banks’ customers. Reward system is a very important tool that all banks can use to strait employees’ motivation in different ways. In other words, banks give rewards to employees and rewards system seek to attract employees to join the bank to keep than coming to work and also motivate them to perform to high level. Basically, all types of rewards motivate to employees to perform well by attracting with well designed compensate package by banks. We can define reward system as “formal or informal programme used to recognize individual employee’s
organizational performance.
The word “motivation” was originally derived from the Latin word “mover” which means “to move”. However, over time various researchers have attempted to have a more comprehensive definition of the word and motivation has been defined in different ways. Most of them agree that it is a goaldirected behavior. Motivation is a psychological process that gives behavior purpose and direction. We can define motivation as “Internal and external factors that stimulate desire and energy in people to be continually interested in, and committed to a job, role or subject and to exert persistent effort in achieving a goal”. Abraham Maslow’s Need Hierarchy Theory
(1943): Maslow’s theory on the hierarchy of needs is one of the most popular theories of motivation. Maslow (1943) stated that employees had five
ISSN 2220-9425
achievements, such as accomplishment of goal or project.” These can be money and other things such
© JournalsBank.com (2011).
167
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
levels of needs and that human needs were in the form of a hierarchy ascending from the lowest to the highest namely: 1- Physiological needs, 2Safety Needs, 3-Social Needs, 4-Esteem Needs, 5Need for Self-actualization .A good pay and interesting work are keys to higher motivation. All employees of banks are very important motivated employees are more productive and help bank to survive. The main objective of reward system is to attract retain high performance employees, get maximum employees performance and satisfy legal standard. Harpaz(1990) listed the three most motivating factors as: interesting work, good wages and job security. II. Literature Review
and effective and efficient organization depend upon the employees’ motivation. Motivation is factor which has influence on organization performance and effectiveness. Thus it is important for every management to understand how
organization influences the motivation of their individual employees. Rehman K.U, Zaheer.B and Sufwan .N. (2007) conduct a research on human resources strategies like promotion, pay and training on job satisfaction in Pakistan. They concluded that promotion, pay and training have positive significant impact on job satisfaction of employee. Also they further explain that most employees give less importance to training as compared to pay and promotion. Ali, R. and Ahmed, M. S. (2009) conduct a study on Uniliver Company Lahore, use sample size 80 employee for this study. This study shows that there is positive significant relationship between reward system and employee satisfaction. Payment (salary) factor is highly influence on employee satisfaction. There is also positive correlation between reward recognition and motivation,
Deeprose (1994) argued that positive correlation between reward system and employee motivation exit and described that effective reward system is very important for any organization because effective rewards can help to achieve the business objectives by attracting and retaining effective employees. Effective rewards and motivation increase employee productivity. This study shows hat level of motivation and increases wages. through If an
satisfaction.
interesting
work
good
organization designs reward system properly according to legal and other requirements, then employees will be more motivated. Rutherford (2005) opines that different factors are very important for better performance of any company
© JournalsBank.com (2011).
Okojie, (2009) described that effective and efficient reward programme will increase the employee motivation of National Library of Nigeria. Highly motivated employees will lead toward increase in productivity and performance.
ISSN 2220-9425
168
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
In this study 100 questionnaires were sent to National Library of Nigeria’s employees and responded rate was 81%. The participant were not awareness about reward programmes. Khan,K.U and Farooq, (2010) conduct a research on
promotes
other
objectives
such
as
legal
compliance, labour cost control, perceived fairness towards employees and enhancement of employee performance to achieve high level of productivity and customer satisfaction. Malik, and Ghafoor, (2011) conduct a research by taking sample size 103 employees of Telecommunication companies and different banks of Punjab and discuss employee motivation, employee performance and organizational effectiveness. Motivated employees are more productive as compared to de-motivated employees. There is positive relationship and between organization and
Commercial Banks of Kohaat ,Pakistan . There were 200 questionnaires distributed among
employees of the different commercial banks of Kohaat, Pakistan and response rate was 167 employees. This study shows that there is positive statistical significant relationship between rewards and employee motivation among the employees commercial banks of Kohaat, Pakistan. Reward system is directly proportional to employee work motivation. Rewards and compensation systems motivate employees to give their maximum efforts towards assigned work. Compensation systems Conceptual Framework (Independent Variables)
effectiveness
employee
motivation
performance but not more strong relationship between them.
(Dependent Variable)
Salary Job security Promotion Working condition Appreciation Rewards Employee Motivation
Figure 1
© JournalsBank.com (2011).
ISSN 2220-9425
169
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
Objectives of this study (i). To determine if there is association between rewards and employee motivation,
H1- There is association between rewards and employee demographics (gender, age, education, qualification and Income level) in Pakistani banks. Hypothesis: B H0- Motivation does not depend on rewards system H1 -Motivation depends on rewards system Questionnaire Structure Questionnaire consisted of two parts. Part one focuses on demographic factors and the other part
biographical factors (Gender, age, education, qualification and Income level). (ii). To identify the types of reward system in Pakistani Banks. (iii). To determine the impacts of rewards system on Banks employees’ biographical variables. (iv). To suggest ways in which reward programme in Pakistani banks can be improved upon in order to increase employee motivation. III. Methodology
consisted of independent variables factors of employee motivation and rewards. Scoring ranged from 1- 5 point scale in following pattern (1= strong agree , 2= agree , 3= neutral , 4= disagree , 5= strong disagree ). Research Instruments For this study we used 5-point and use scale method for data of collection. Basically this questionnaire consisted of two parts with section “ A” comprising items seeking demographic data
Primary data was used for the present study. Primary data by collected using by sort of structured different
questionnaires
approaches. There are about 40 banks operating in Pakistan and data were gathered from 21 different banks of Pakistan.240 questionnaires were distributed in different banks but response rate was 226 (93%).The target population for this study is all employees of all banks of Pakistan. Hypothesis: A H0- There is no association between rewards and employee demographics (gender, age, education, qualification and Income level) in Pakistani banks.
such as gender, experience, age, income level and qualification of banks employees. Part “B” had items which sought to collect information about independent variables (salary, promotion,
appreciation, job security, working conditions)
© JournalsBank.com (2011).
ISSN 2220-9425
170
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
. Primary Data By Administrative approach By Telephone By E-mail Total Questionnaire sent 219 9 12 240 Response Rate 84% 3.75% 5.25% 226
IV.
Data Analysis and Results
female of the total sample. 60.2% respondents are Masters Degree holder. About 51.8% of the professionals were drawing a salary between Rs. 10,000 to Rs. 30,000 and more than 46.9% had job experience between 1-5 years. In Table-2, 71.9% employees strongly agreed and agreed that they are motivated through good salary, while 52.9 % employees strongly agreed and agreed that they were motivated through employer attitude. Highlighted figures show response against different questions.
SPSS (Statistical Package for Social Sciences) version 17 of the software was used for analysis of study data. Out of a total of 240 respondents, 226 filled and returned the questionnaires. Response rate was 93%. Reliability and validity Basically, reliability refers to the consistency or dependability of a measuring instrument. This questionnaire is valid for measuring the
employee motivation and reward system. In this research, Cronbach-Alpha value is .65 The demographics and descriptive statistics of the sample are presented in Table 1. Out of 226 respondents in the sample, 101 employees belong to the 20-30 age category, that is 44.7% of the total sample. Males were 81% and 19%
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Table 1 (Demographic profile) Demographics Gender Age(Year) Category Male Female Less than 30 31-40 41-50 51-60 Above 60 Bachelor Master M. Phill Ph.D Other Less than 10,000 11,000-30,000 31,000-50,000 51,000-70,000 Above 70,000 Less than one year 1-5 year 5-10 year Above 10 year % age 81 19 44.7 36.7 15 3.1 .41 30.1 60.2 5.3 0 4.4 4.4 51.8 33.6 7.1 3.1 8.4 46.9 31.9 12.8
Education Level
Income ($)Annually
Experience (year)
Table 2 (Respondent Profile) Work motivation factors (Questions) Good salary Interesting Work Job security Promotion Appreciation Opportunity for advancement Employer attitude Strongly Agree 71.9 % 59.7% 65.9% 54.4% 65.2% 66.2% 52.9% agree + Neutral Disagree Disagree 14.6% 17.7% 21.2% 23.9% 16.8% 22.6% 22.7% 13.5% 22.6% 12.9% 21.7% 18% 11.2% 24.4% + Strongly
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Sympathetic Personal Help Good working conditions Other benefits
61.2% 64.5% 53.9%
22.8% 20.4% 34.4%
16% 15.1% 11.7%
Chi Square Test Chi square test is applicable when data is categorical. Chi square was applied for testing hypothesis-1 Table 3 (Chi-Square Tests) Value Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases 9.597a 9.525 .013 226 df 4 4 1 Asymp. sided) .048 .049 .908 Sig. (2-
a. 1 cells (10.0%) have expected count less than 5. The minimum expected count is 1.75.
Chi Square Test Demographical factors Vs Motivation Factors Table 4 Association between two categorical variables Gender Vs salary Gender Vs job security Gender Vs workload Gender Vs praised(admiration) Age Vs suggestions Experience Vs job security Income Vs bonus, incentives Association in (Yes/ No) Yes No Yes Yes Yes Yes yes P-Value .048 .2356 .0123 .0045 .0091 .0245 .0030
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Table 4 shows that there is association between gender and salary of banking employees because p- value is .048, which less than .05. So we accepted the Hypothesis H1 and rejected the Null Hypothesis (H0). In banking sector salary varies with gender wise. Some banks give more salary to female as compared to male. So we can say that an impact of gender on salary of bank employees is positive. There is association between gender and workload. Female
abele employees have more secure from his job and bank not fire form. There is association between income level and Bonus, incentives. Banks gives more incentives and bonus to their employees .Who receive high level income like (above Rs.50, 000).There is no association between gender and job security. Correlation and Regression Analysis In order to find out the nature of relationship between two variables and analysis is carried out. The line regression explained the pattern of variation of depended variable in relation to the independent variable. In this research ,in order to find what relationship exists between reward system and employee motivation, the binary regression is applied.
employees have less workload as compared to male employees. There is association between gender and admiration (praised of employee). There is association between age and
suggestions of bank employees. Management of any bank encourages the suggestions of old age bank employees. There is association between experience and job security. High experience Table 5 ( Correlations)
Motivation Motivation Pearson Correlation Sig. (2-tailed) N Reward Pearson Correlation Sig. (2-tailed) N **. Correlation is significant at the 0.01 level (2-tailed). 226 .546** .000 226 1
Reward .546** .000 226 1
226
In Table 5, 0.546** value shows result that there is positive relationship between motivation and reward.
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Table 6 (Coefficients) Model Unstandardized Coefficients B 1 (Constant) Reward 6.664 .527 Std. Error .572 .054 .546 Standardized Coefficients Beta 11.651 9.767 .000 .000 tStatistic Sig.
Dependent Variable: motivation
Table 7 Reward Vs employee motivation Indicator Regression Correlation Sig-value R-square Values Motivation = 6.66 + 0.0527reward .546 .000 0.61
Motivation = 6.66 + 0.0527reward
…………
R-square = 0.61 between rewards and employee motivation is 0.0546. The value of R-square is 0.61 which shows the explanatory power of regression model and employee motivation is accepted by Reward.
Regression equation given above shows the positive effect of reward on employee
motivation. That , when reward is increased by one unit, then motivation increased by 0.527, so we can say that motivation is directly
proportional to rewards and that motivation is depends on rewards .P-value is .000 which is less than .05, so we rejected H0.The correlation
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V.
Conclusion and Recommendations
The paper recommends that in order to increase the employees’ motivation by redesigning the reward system. (i). Employees should be trained according to the present context of the environment. (ii). Regrading the salary and other allowances.
In this Study, every element like job security, salary, working conditions and appreciation relates with the rewards and employee
motivation of banking sector of Pakistan. The study establishes that employee motivation is explained by several factors. In this research, it was revealed that rewards and employee motivation have positive relationship and chisquare results shows that there is association between motivational factors and demographical variables like ( gender, age, qualification, income and experience ) but there is no association between employee motivation and qualification of banks employees, while
(iii). Internal work environment of banks must be pleasant. In order to satisfy the staff and work with efficiency. (iv). Different facilities to be provided to all employees in order to enhance the
employees’ motivation and job satisfaction. Management of any bank need to encourage the salary scheme of employees that would to
experience showed the least association. On the other hand, similarities were also identified, when reward is increased by one unit, then motivation increased by 0.527, so we can say that motivation depends upon rewards .Simply change in reward offer will have same effect of change in employee work motivation. After the careful analysis to determine, the ranked order of motivational factors are, 1.good salary,
upgreat their standard of living. 1-Bonus 2Holiday pay 3- Overtime pay 4- Pension Benefits 5- Proper training and promotion also needs to be given to the staff in order to promote their job satisfaction. Limitation and Are Further Research Data collected for present study from only 21 banks from only Punjab District, Pakistan and sample size was not enough for better results. Further researchers in this area should focus the work-life issues, flexible working hours of banks’ employees. Impact of factors other than rewards on employees’ motivation. Consider the different levels of employees in banks. Consider
2.Promotions and growth in the organization 3.Full appreciation of work done, 4. Job security, 5. Good working conditions, 6.personal loyalty to employees, 7.tactful discipline, and 8. Sympathetic help with personal problems.
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the comparison of motivation level of private
and public sector employees of Pakistani banks.
References [1]. Ali, R. & Ahmed, M. S. (2009). The impact of reward and recognition [6]. Lindner, James.R.(1998).Understanding employee motivation, Journal of
programs on employee’s motivation and satisfaction: International an empirical of study, Business
Extension volume. 36, Number 3 [7]. Maire, K. and Nick, O. (2002).Collective and Individual Improvement Activities: The Role of Reward Systems, Personal Review, pp.320-337. [8]. Malik and Ghafoor
Review
Research papers, Vol. 5 No. 4, pp. 270279 [2]. Deci, E. L. (1971).Effects of externally mediated rewards on intrinsic motivation, Journal of Personality and Social
.(2011).Organizational Effectiveness: A case study of Telecommunication and Banking Sector of Pakistan , For East Journal of Psychology and Business ,Volume No.1 , January 2011 [9]. Okojie (2009). Reward Policy and
Psychology, Vol. 18, pp. 105-115. [3]. Deeprose,D.(1994).How to recognize and reward employees. New York:
AMACOM [4]. Eisenberger, R. and Cameron, J.(1996). Detrimental effects of reward: reality of myth? American Psychologist, Vol.51, pp. 1153-1166. [5]. Khan,K.U & Farooq, S.U at el(2010).The Relationship between reward and
Employee Motivation in the National Library of Nigeria (NLN) , Samaru Journal of Information Studies Volume.9 , 200910 [10]. Rehman K.U, Zaheer.B and Sufwan .N.(2007).A Study Measuring the Effect of Pay, Promotion and Training on Job Satisfaction in Pakistani Service Industry. European Journal of Social Sciences, Volume 5, Number 3, October, 2007.
employee motivation in Commercial Banks of Pakistan, Research Journal of International Studies , Issue -1, May 14, 2010
© JournalsBank.com (2011).
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[11]. Roberts between
R.L.
(2005).
Relationship and
[12]. Rutherford,
D.
G.(1990).Hotel
rewards,
recognition
Management and Operations. New York, NY: Van Nostrand Reinhold Syedain, H. (1995).The rewards of recognition.
motivation at insurance company in the Western Cape: University Of The
Western Cape
Management Today, page 72-75.
© JournalsBank.com (2011).
ISSN 2220-9425
178
doc_646870776.pdf
Motivation is a psychological feature that arouses an organism to act towards a desired goal and elicits, controls, and sustains certain goal-directed behaviors.
Association between Reward and Employee motivation: A case study Banking Sector of Pakistan
Malik Muhammad Shafiq* Muhammad Saqlain Raza‡ Maira Mariam†
* †
[Corresponding Author], [MBA(HR), The University of Lahore, Pakistan], [[email protected]] [MBA, Lahore College for Women, Pakistan], [[email protected]] ‡ [MBA, The University of Lahore, Pakistan], [[email protected]]
© 2011.Malik M. S., Maria M., & Muhammad S. R. This is a research/review paper, distributed under the terms of the Creative Commons Attribution-Noncommercial 3.0 Unported License http://creativecommons.org/licenses/by-nc/3.0/, permitting all non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited. Special Issue Theme: “Planning, Policies & Global Issue” © JournalsBank.com (2011). ISSN 2220-9425
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
Association between Reward and Employee motivation: A case study Banking Sector of Pakistan§
Malik Muhammad S., Maira Maria, & Muhammad Saqlain R.
Abstract This study seeks to association between reward and employee motivation and also identify associations between employee motivation and employee demographics variables like (gender, age, and education and income level and job experience) in banking sector of Pakistan. The study is based on primary data and sample Size (N= 226) consisted of male and female employees of 21 different banks. Primary data collected by structured questionnaire by using sort of different approaches and this study was survey base. Two different hypotheses were developed for the present study and were tested by applying Chi-square Test and binary Regression Test. The result of Chi-square shows that P- value is 0.048 of Chi-square its mean there is association between salary and gender. The correlation between rewards and Employee Motivation is 0.546, which shows the positive relationship between reward and employee motivation. The estimated regression model revealed that when reward is increased by one unit then motivation increased by 0.527 units, so we can say that rewards is directly proportional to employee motivation and employee motivation depends on rewards. The results also showed that salary is a very important factor for employee motivation as compared to other variables like promotion, job security, working condition, appreciation and other benefits. Keywords: Reward system, motivation, employee, banks, Human Resource Management
§
Acknowledgment Nil
© JournalsBank.com (2011).
ISSN 2220-9425
166
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
I.
Introduction
as pension, health insurance, bonus, promotion, working conditions, training and good environment that you get from being employed. There are two types of reward system, one is financial rewards (salary, bonus, commission, incentives) second is non financial rewards (promotion, opportunity to completion, training, skills, meaningful work and work kind condition). Roberts (2005) discuss that organizations are under constant pressure to enhance and improve their performance and are realizing that relationship performance exists and between employee
Bank refer to a corporation empowered to deal with cash, domestic, foreign, and receive deposits of money and loan those monies to third parties”. There are about 40 banks operating in Pakistan 1Government Banks (National Banks of Pakistan, State Bank of Pakistan and Bank of Punjab), 2Commercial Banks like (Muslim Commercial Bank, Mezan Bank, Bank Alfalah, Habib
Metropolitan Bank, Standard Charted Bank etc). The banks play important role in economy of any country and also worldwide economy and banks employees are the best sources of delivering good services to their customers. Excellent services provided and offered by employees can create a positive perception and ever lasting image in the eyes of banks’ customers. Reward system is a very important tool that all banks can use to strait employees’ motivation in different ways. In other words, banks give rewards to employees and rewards system seek to attract employees to join the bank to keep than coming to work and also motivate them to perform to high level. Basically, all types of rewards motivate to employees to perform well by attracting with well designed compensate package by banks. We can define reward system as “formal or informal programme used to recognize individual employee’s
organizational performance.
The word “motivation” was originally derived from the Latin word “mover” which means “to move”. However, over time various researchers have attempted to have a more comprehensive definition of the word and motivation has been defined in different ways. Most of them agree that it is a goaldirected behavior. Motivation is a psychological process that gives behavior purpose and direction. We can define motivation as “Internal and external factors that stimulate desire and energy in people to be continually interested in, and committed to a job, role or subject and to exert persistent effort in achieving a goal”. Abraham Maslow’s Need Hierarchy Theory
(1943): Maslow’s theory on the hierarchy of needs is one of the most popular theories of motivation. Maslow (1943) stated that employees had five
ISSN 2220-9425
achievements, such as accomplishment of goal or project.” These can be money and other things such
© JournalsBank.com (2011).
167
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
levels of needs and that human needs were in the form of a hierarchy ascending from the lowest to the highest namely: 1- Physiological needs, 2Safety Needs, 3-Social Needs, 4-Esteem Needs, 5Need for Self-actualization .A good pay and interesting work are keys to higher motivation. All employees of banks are very important motivated employees are more productive and help bank to survive. The main objective of reward system is to attract retain high performance employees, get maximum employees performance and satisfy legal standard. Harpaz(1990) listed the three most motivating factors as: interesting work, good wages and job security. II. Literature Review
and effective and efficient organization depend upon the employees’ motivation. Motivation is factor which has influence on organization performance and effectiveness. Thus it is important for every management to understand how
organization influences the motivation of their individual employees. Rehman K.U, Zaheer.B and Sufwan .N. (2007) conduct a research on human resources strategies like promotion, pay and training on job satisfaction in Pakistan. They concluded that promotion, pay and training have positive significant impact on job satisfaction of employee. Also they further explain that most employees give less importance to training as compared to pay and promotion. Ali, R. and Ahmed, M. S. (2009) conduct a study on Uniliver Company Lahore, use sample size 80 employee for this study. This study shows that there is positive significant relationship between reward system and employee satisfaction. Payment (salary) factor is highly influence on employee satisfaction. There is also positive correlation between reward recognition and motivation,
Deeprose (1994) argued that positive correlation between reward system and employee motivation exit and described that effective reward system is very important for any organization because effective rewards can help to achieve the business objectives by attracting and retaining effective employees. Effective rewards and motivation increase employee productivity. This study shows hat level of motivation and increases wages. through If an
satisfaction.
interesting
work
good
organization designs reward system properly according to legal and other requirements, then employees will be more motivated. Rutherford (2005) opines that different factors are very important for better performance of any company
© JournalsBank.com (2011).
Okojie, (2009) described that effective and efficient reward programme will increase the employee motivation of National Library of Nigeria. Highly motivated employees will lead toward increase in productivity and performance.
ISSN 2220-9425
168
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
In this study 100 questionnaires were sent to National Library of Nigeria’s employees and responded rate was 81%. The participant were not awareness about reward programmes. Khan,K.U and Farooq, (2010) conduct a research on
promotes
other
objectives
such
as
legal
compliance, labour cost control, perceived fairness towards employees and enhancement of employee performance to achieve high level of productivity and customer satisfaction. Malik, and Ghafoor, (2011) conduct a research by taking sample size 103 employees of Telecommunication companies and different banks of Punjab and discuss employee motivation, employee performance and organizational effectiveness. Motivated employees are more productive as compared to de-motivated employees. There is positive relationship and between organization and
Commercial Banks of Kohaat ,Pakistan . There were 200 questionnaires distributed among
employees of the different commercial banks of Kohaat, Pakistan and response rate was 167 employees. This study shows that there is positive statistical significant relationship between rewards and employee motivation among the employees commercial banks of Kohaat, Pakistan. Reward system is directly proportional to employee work motivation. Rewards and compensation systems motivate employees to give their maximum efforts towards assigned work. Compensation systems Conceptual Framework (Independent Variables)
effectiveness
employee
motivation
performance but not more strong relationship between them.
(Dependent Variable)
Salary Job security Promotion Working condition Appreciation Rewards Employee Motivation
Figure 1
© JournalsBank.com (2011).
ISSN 2220-9425
169
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
Objectives of this study (i). To determine if there is association between rewards and employee motivation,
H1- There is association between rewards and employee demographics (gender, age, education, qualification and Income level) in Pakistani banks. Hypothesis: B H0- Motivation does not depend on rewards system H1 -Motivation depends on rewards system Questionnaire Structure Questionnaire consisted of two parts. Part one focuses on demographic factors and the other part
biographical factors (Gender, age, education, qualification and Income level). (ii). To identify the types of reward system in Pakistani Banks. (iii). To determine the impacts of rewards system on Banks employees’ biographical variables. (iv). To suggest ways in which reward programme in Pakistani banks can be improved upon in order to increase employee motivation. III. Methodology
consisted of independent variables factors of employee motivation and rewards. Scoring ranged from 1- 5 point scale in following pattern (1= strong agree , 2= agree , 3= neutral , 4= disagree , 5= strong disagree ). Research Instruments For this study we used 5-point and use scale method for data of collection. Basically this questionnaire consisted of two parts with section “ A” comprising items seeking demographic data
Primary data was used for the present study. Primary data by collected using by sort of structured different
questionnaires
approaches. There are about 40 banks operating in Pakistan and data were gathered from 21 different banks of Pakistan.240 questionnaires were distributed in different banks but response rate was 226 (93%).The target population for this study is all employees of all banks of Pakistan. Hypothesis: A H0- There is no association between rewards and employee demographics (gender, age, education, qualification and Income level) in Pakistani banks.
such as gender, experience, age, income level and qualification of banks employees. Part “B” had items which sought to collect information about independent variables (salary, promotion,
appreciation, job security, working conditions)
© JournalsBank.com (2011).
ISSN 2220-9425
170
European Journal of Humanities and Social Sciences Vol. 5, No.1 (Special Issue), 2011
. Primary Data By Administrative approach By Telephone By E-mail Total Questionnaire sent 219 9 12 240 Response Rate 84% 3.75% 5.25% 226
IV.
Data Analysis and Results
female of the total sample. 60.2% respondents are Masters Degree holder. About 51.8% of the professionals were drawing a salary between Rs. 10,000 to Rs. 30,000 and more than 46.9% had job experience between 1-5 years. In Table-2, 71.9% employees strongly agreed and agreed that they are motivated through good salary, while 52.9 % employees strongly agreed and agreed that they were motivated through employer attitude. Highlighted figures show response against different questions.
SPSS (Statistical Package for Social Sciences) version 17 of the software was used for analysis of study data. Out of a total of 240 respondents, 226 filled and returned the questionnaires. Response rate was 93%. Reliability and validity Basically, reliability refers to the consistency or dependability of a measuring instrument. This questionnaire is valid for measuring the
employee motivation and reward system. In this research, Cronbach-Alpha value is .65 The demographics and descriptive statistics of the sample are presented in Table 1. Out of 226 respondents in the sample, 101 employees belong to the 20-30 age category, that is 44.7% of the total sample. Males were 81% and 19%
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Table 1 (Demographic profile) Demographics Gender Age(Year) Category Male Female Less than 30 31-40 41-50 51-60 Above 60 Bachelor Master M. Phill Ph.D Other Less than 10,000 11,000-30,000 31,000-50,000 51,000-70,000 Above 70,000 Less than one year 1-5 year 5-10 year Above 10 year % age 81 19 44.7 36.7 15 3.1 .41 30.1 60.2 5.3 0 4.4 4.4 51.8 33.6 7.1 3.1 8.4 46.9 31.9 12.8
Education Level
Income ($)Annually
Experience (year)
Table 2 (Respondent Profile) Work motivation factors (Questions) Good salary Interesting Work Job security Promotion Appreciation Opportunity for advancement Employer attitude Strongly Agree 71.9 % 59.7% 65.9% 54.4% 65.2% 66.2% 52.9% agree + Neutral Disagree Disagree 14.6% 17.7% 21.2% 23.9% 16.8% 22.6% 22.7% 13.5% 22.6% 12.9% 21.7% 18% 11.2% 24.4% + Strongly
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Sympathetic Personal Help Good working conditions Other benefits
61.2% 64.5% 53.9%
22.8% 20.4% 34.4%
16% 15.1% 11.7%
Chi Square Test Chi square test is applicable when data is categorical. Chi square was applied for testing hypothesis-1 Table 3 (Chi-Square Tests) Value Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases 9.597a 9.525 .013 226 df 4 4 1 Asymp. sided) .048 .049 .908 Sig. (2-
a. 1 cells (10.0%) have expected count less than 5. The minimum expected count is 1.75.
Chi Square Test Demographical factors Vs Motivation Factors Table 4 Association between two categorical variables Gender Vs salary Gender Vs job security Gender Vs workload Gender Vs praised(admiration) Age Vs suggestions Experience Vs job security Income Vs bonus, incentives Association in (Yes/ No) Yes No Yes Yes Yes Yes yes P-Value .048 .2356 .0123 .0045 .0091 .0245 .0030
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Table 4 shows that there is association between gender and salary of banking employees because p- value is .048, which less than .05. So we accepted the Hypothesis H1 and rejected the Null Hypothesis (H0). In banking sector salary varies with gender wise. Some banks give more salary to female as compared to male. So we can say that an impact of gender on salary of bank employees is positive. There is association between gender and workload. Female
abele employees have more secure from his job and bank not fire form. There is association between income level and Bonus, incentives. Banks gives more incentives and bonus to their employees .Who receive high level income like (above Rs.50, 000).There is no association between gender and job security. Correlation and Regression Analysis In order to find out the nature of relationship between two variables and analysis is carried out. The line regression explained the pattern of variation of depended variable in relation to the independent variable. In this research ,in order to find what relationship exists between reward system and employee motivation, the binary regression is applied.
employees have less workload as compared to male employees. There is association between gender and admiration (praised of employee). There is association between age and
suggestions of bank employees. Management of any bank encourages the suggestions of old age bank employees. There is association between experience and job security. High experience Table 5 ( Correlations)
Motivation Motivation Pearson Correlation Sig. (2-tailed) N Reward Pearson Correlation Sig. (2-tailed) N **. Correlation is significant at the 0.01 level (2-tailed). 226 .546** .000 226 1
Reward .546** .000 226 1
226
In Table 5, 0.546** value shows result that there is positive relationship between motivation and reward.
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Table 6 (Coefficients) Model Unstandardized Coefficients B 1 (Constant) Reward 6.664 .527 Std. Error .572 .054 .546 Standardized Coefficients Beta 11.651 9.767 .000 .000 tStatistic Sig.
Dependent Variable: motivation
Table 7 Reward Vs employee motivation Indicator Regression Correlation Sig-value R-square Values Motivation = 6.66 + 0.0527reward .546 .000 0.61
Motivation = 6.66 + 0.0527reward
…………
R-square = 0.61 between rewards and employee motivation is 0.0546. The value of R-square is 0.61 which shows the explanatory power of regression model and employee motivation is accepted by Reward.
Regression equation given above shows the positive effect of reward on employee
motivation. That , when reward is increased by one unit, then motivation increased by 0.527, so we can say that motivation is directly
proportional to rewards and that motivation is depends on rewards .P-value is .000 which is less than .05, so we rejected H0.The correlation
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V.
Conclusion and Recommendations
The paper recommends that in order to increase the employees’ motivation by redesigning the reward system. (i). Employees should be trained according to the present context of the environment. (ii). Regrading the salary and other allowances.
In this Study, every element like job security, salary, working conditions and appreciation relates with the rewards and employee
motivation of banking sector of Pakistan. The study establishes that employee motivation is explained by several factors. In this research, it was revealed that rewards and employee motivation have positive relationship and chisquare results shows that there is association between motivational factors and demographical variables like ( gender, age, qualification, income and experience ) but there is no association between employee motivation and qualification of banks employees, while
(iii). Internal work environment of banks must be pleasant. In order to satisfy the staff and work with efficiency. (iv). Different facilities to be provided to all employees in order to enhance the
employees’ motivation and job satisfaction. Management of any bank need to encourage the salary scheme of employees that would to
experience showed the least association. On the other hand, similarities were also identified, when reward is increased by one unit, then motivation increased by 0.527, so we can say that motivation depends upon rewards .Simply change in reward offer will have same effect of change in employee work motivation. After the careful analysis to determine, the ranked order of motivational factors are, 1.good salary,
upgreat their standard of living. 1-Bonus 2Holiday pay 3- Overtime pay 4- Pension Benefits 5- Proper training and promotion also needs to be given to the staff in order to promote their job satisfaction. Limitation and Are Further Research Data collected for present study from only 21 banks from only Punjab District, Pakistan and sample size was not enough for better results. Further researchers in this area should focus the work-life issues, flexible working hours of banks’ employees. Impact of factors other than rewards on employees’ motivation. Consider the different levels of employees in banks. Consider
2.Promotions and growth in the organization 3.Full appreciation of work done, 4. Job security, 5. Good working conditions, 6.personal loyalty to employees, 7.tactful discipline, and 8. Sympathetic help with personal problems.
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the comparison of motivation level of private
and public sector employees of Pakistani banks.
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