The Paradox of Rewards: Reconsidering Employee Satisfaction and Ideation Performance;

Document Type : Original Article

Authors

1 Department of Technology Entrepreneurship, Faculty of Entrepreneurship, University of Tehran, Tehran, Iran

2 Faculty of Entrepreneurship, Farshi Moghadam Street

3 Department of Corporate Entrepreneurship, Faculty of Entrepreneurship, University of Tehran, Tehran, Iran

10.22080/shrm.2024.4599

Abstract

This study examines the effect of successive monetary-rewards on employee satisfaction using an experimental method with the participation of 109 ICT professionals in China. Participants took a computerized-ideation-test with random rewards. Data were collected using the post-test ideation process and Gussman’s business model by SPSS and analyzed by the mixed-model-method.
The research findings challenge the dominant literature in the area of motivation and satisfaction, and show that monetary-rewards increase satisfaction only in the first allocation, but even if they are continued, do not increase satisfaction, so that although paying a bonus in the first round, satisfaction is at its highest value in all groups, but in all subsequent periods, decreases significantly, so that in all groups, satisfaction during and at the end of the period is lower than the beginning of the period. Also, although the highest level of satisfaction was observed in the group receiving the highest reward, did not lead to an improvement in ideation-performance and an increase in the idea-quality.
Our results contrast with many previous studies that report a positive relationship between rewards, motivation, satisfaction, and performance and questions the effectiveness of monetary-rewards in increasing employees’ long-term motivation, and satisfaction, and performance. Therefore, human resource managers of organizations should carefully monitor the use of rewards for specialists, because by providing continuous bonuses, despite spending resources, it leads to a decrease in the satisfaction and performance of experts in the long term.

Keywords

References

Adams, J. S. (1965). Inequity In Social Exchange. Advances in Experimental Social Psychology, 2(C).
https://doi.org/10.1016/S0065-2601(08)60108-2
Adams, S. J. (1963). Toward and Understanding of Inequity. Journal of Abnormal Psychology, 67(5).
Amabile, T. M. (1997). Motivating creativity in organizations: On doing what you love and loving what you do. California Management Review, 1. https://doi.org/10.2307/41165921
Amabile, T. M. (2013). Componential Theory of Creativity. Encyclopedia of Management Theory.
Benedek, M., Bruckdorfer, R., & Jauk, E. (2020). Motives for Creativity: Exploring the What and Why of Everyday Creativity. Journal of Creative Behavior, 54(3).
https://doi.org/10.1002/jocb.396
BLS. (2022). Employer Costs for Employee Compensation for the Regions – March 2022: Southwest Information Office: U.S. Bureau of Labor Statistics. https://www.bls.gov/regions/southwest/news-release/employercostsforemployeecompensation_regions.htm
Carlson, N. R., Buskist, William., Heth, C. Donald., & Schmaltz, Rod. (2009). Psychology: the Science of Behaviour, Fourth Canadian Edition with MyPsychLab. Pearson Education Canada.
Dean, D. L., Hender, J. M., Rodgers, T. L., & Santanen, E. L. (2006). Identifying Good Ideas: Constructs and Scales for Idea Evaluation. Journal of Association for Information Systems, 10(7).
Deci, E. L. (1971). Effects of externally mediated rewards on intrinsic motivation. Journal of Personality and Social Psychology, 18(1).
 https://doi.org/10.1037/h0030644
Deci, E. L., & Ryan, R. M. (1985). Intrinsic Motivation and Self-Determination in Human Behavior. In Intrinsic Motivation and Self-Determination in Human Behavior.
https://doi.org/10.1007/978-1-4899-2271-7
Deci, E. L., & Ryan, R. M. (2008). Self-determination theory: A macrotheory of human motivation, development, and health. Canadian Psychology, 49(3). https://doi.org/10.1037/a0012801
Deci, E. L., Ryan, R. M., & Koestner, R. (1999). A meta-analytic review of experiments examining the effects of extrinsic rewards on intrinsic motivation. In Psychological Bulletin (Vol. 125, Issue 6).
https://doi.org/10.1037/0033-2909.125.6.627
Deckop, J. R., Jurkiewicz, C. L., & Giacalone, R. A. (2010). Effects of materialism on work-related personal well-being. Human Relations, 63(7). https://doi.org/10.1177/0018726709353953
Eisenberger, R., Armeli, S., & Pretz, J. (1998). Can the Promise of Reward Increase Creativity? Journal of Personality and Social Psychology, 74(3). https://doi.org/10.1037/0022-3514.74.3.704
Esteves-Sorenson, C., & Broce, R. (2022). DO MONETARY INCENTIVES UNDERMINE PERFORMANCE ON INTRINSICALLY ENJOYABLE TASKS? A FIELD TEST. Review of Economics and Statistics, 104(1).
https://doi.org/10.1162/rest_a_00947
Etemadi, M., Chitsaz, E., & Abolghasemi Dehaqani, M. (2023a). The Myth of Rewards and Creative Performance: Should Companies Use Incentives to Boost Creativity in Personnel Performance? 3rd Iran Business Watch Conference 1402. https://doi.org/10.2139/SSRN.4550849
Etemadi, M., Chitsaz, E., & Abolghasemi Dehaqani, M. (2023b). Unveiling the Complexity of the Reward, Creativity, and Performance Relationship: When Does Behavioral Theories Reward Backfire? 3rd Iran Business Watch Conference, 2023.
https://doi.org/10.2139/SSRN.4550749
Fredrickson, B. L. (2001). The role of positive emotions in positive psychology: The broaden-and-build theory of positive emotions. American Psychologist, 56(3).
https://doi.org/10.1037/0003-066X.56.3.218
Fredrickson, B. L., & Branigan, C. (2005). Positive emotions broaden the scope of attention and thought-action repertoires. Cognition and Emotion, 19(3). https://doi.org/10.1080/02699930441000238
Frey, B. S., & Goette, L. (1999). Does pay motivate volunteers? Review of Economics and Statistics, 7(7).
Gagné, M., & Deci, E. L. (2005). Self-determination theory and work motivation. Journal of Organizational Behavior, 26(4).
 https://doi.org/10.1002/job.322
Gassmann Oliver, Frankenberger Karolin, & Csik Michaela. (2014). The Business Model Navigator Testimonials. 55 Models That Will Revolutionise Your Business. Pearson Education Limited.
Ghodratizadeh, F., Chitsaz, E., & Rostami, R. (2022). investigating on the effects of continuous financial rewards on the performance of employees’idea generation in the ict industry of china. Organizational Resources Management Researchs. https://scholar.google.com/citations?view_op=view_citation&hl=en&user=mYiGDXwAAAAJ&citation_for_view=mYiGDXwAAAAJ:2osOgNQ5qMEC
Hackman, J. R., & Oldham, G. R. (1975). Development of the Job Diagnostic Survey. Journal of Applied Psychology, 60(2).
https://doi.org/10.1037/h0076546
Hofstetter, R., Zhang, J. Z., & Herrmann, A. (2018). Successive Open Innovation Contests and Incentives: Winner-Take-All or Multiple Prizes? Journal of Product Innovation Management, 35(4). https://doi.org/10.1111/jpim.12424
Jalal, R. N.-U.-D., & Zaheer, M. A. (2017). Does Job Satisfaction Mediate the Relationship of Workload, Remuneration and Psychological Reward with Job Performance? International Journal of Academic Research in Business and Social Sciences, 7(9). https://doi.org/10.6007/ijarbss/v7-i9/3309
Kahneman, D., & Tversky, A. (1979). Prospect Theory: An Analysis of Decision under Risk Daniel Kahneman; Amos Tversky. Econometrica, 47(2).
Kahneman, D., & Tversky, A. (2018). Prospect theory: An analysis of decision under risk. In Experiments in Environmental Economics (Vol. 1). https://doi.org/10.2307/1914185
Kier, A. S., & McMullen, J. S. (2018). Entrepreneurial imaginativeness in new venture ideation. Academy of Management Journal, 61(6).
https://doi.org/10.5465/amj.2017.0395
Kruger, J., & Dunning, D. (1999). Unskilled and unaware of it: How difficulties in recognizing one’s own incompetence lead to inflated self-assessments. Journal of Personality and Social Psychology, 77(6).
https://doi.org/10.1037/0022-3514.77.6.1121
Lunenburg, F. C. (2011). Expectancy Theory of Motivation: Motivating by Altering Expectations. International Journal of Business Administration, 15(1).
McCoy, R. (2018). The Relationship of Employee Reward Systems and Motivation Levels with Special Emphasis on Franchising. LIGS University, February.
Oldham, G. R., & Richard Hackman, J. (2010). Not what it was and not what it will be: The future of job design research. In Journal of Organizational Behavior (Vol. 31, Issues 2–3). https://doi.org/10.1002/job.678
Olsson, M., Hogberg, J., Wastlund, E., & Gustafsson, A. (2016). In-store gamification: Testing a location-based treasure hunt app in a real retailing environment. Proceedings of the Annual Hawaii International Conference on System Sciences, 2016-March. https://doi.org/10.1109/HICSS.2016.206
Peters, R. S. (2018). Drive Theories. In The Concept of Motivation (pp. 95–129). Routledge. https://doi.org/10.4324/9781315712833-4
Prasanga, A. A., & Gamage, A. S. (2013). Job Satisfaction and Job Performance of the Sailors in Rapid Action Boat Squadron of Sri Lanka Navy. Sri Lankan Journal of Human Resource Management, 3(1), 49.
https://doi.org/10.4038/sljhrm.v3i1.5097
Richard M. Ryan, & Deci, E. L. (2009). Intrinsic and Extrinsic Motivations: Classic Definitions and New Direction. Contemporary Educational Psychology 25, 54–67. Academy of Management Learning and Education, 8(2).
Rosenfield, D., Folger, R., & Adelman, H. F. (1980). When rewards reflect competence: A qualification of the overjustification effect. Journal of Personality and Social Psychology, 39(3). https://doi.org/10.1037/0022-3514.39.3.368
Ryan, R. M., & Deci, E. L. (1985). The “third selective paradigm” and the role of human motivation in cultural and biological selection: A response to Csikszentmihalyi and Massimini. New Ideas in Psychology, 3(3). https://doi.org/10.1016/0732-118X(85)90020-0
Ryan, R. M., & Deci, E. L. (2000). Self-determination theory and the facilitation of intrinsic motivation, social development, and well-being. American Psychologist, 55(1).
https://doi.org/10.1037/0003-066X.55.1.68
Schmitz, L., Bijleveld, E., & Veling, H. (2020). Cognitive labor shapes the desire for social and monetary compensation. Motivation and Emotion, 44(6).
https://doi.org/10.1007/s11031-020-09856-0
Schuhmacher, M. C., & Kuester, S. (2012a). Identification of Lead User Characteristics Driving the Quality-of-Service Innovation Ideas. Creativity and Innovation Management, 21(4). https://doi.org/10.1111/caim.12002
Schuhmacher, M. C., & Kuester, S. (2012b). Identification of Lead User Characteristics Driving the Quality-of-Service Innovation Ideas. Creativity and Innovation Management, 21(4). https://doi.org/10.1111/caim.12002
Selten, R. (1998). Aspiration Adaptation Theory. Journal of Mathematical Psychology, 42(2–3).
 https://doi.org/10.1006/jmps.1997.1205
Selten, R. (2001). What Is Bounded Rationality? Bounded Rationality The Adaptive Toolbox, May.
Shaw, J. D., & III, E. E. L. (2002). Rewarding Excellence: Pay Strategies for the New Economy. Administrative Science Quarterly, 47(1).
Simon, H. A. (1954). Some strategic considerations in the construction of social science models. In Mathematical thinking in the social sciences.
Singh, S. K., & Tiwari, V. (2012). Relationship between Motivation and Job Satisfaction of the White-Collar Employees: A Case Study. Management Insight.
StaffConnect. (2018). Employee Engagement Survey Results – StaffConnectApp.
https://web.archive.org/web/20190502040122/https://www.staffconnectapp.com/employee-engagement-survey-results/
Terera, S. R., & Ngirande, H. (2014). The impact of rewards on job satisfaction and employee retention. Mediterranean Journal of Social Sciences, 5(1). https://doi.org/10.5901/mjss.2014.v5n1p481
Titmuss, R. (2019). The Gift Relationship: From Human Blood to Social Policy A study of blood donor motivation in South Africa. May 2022, 1–5.
Tversky, A., & Kahneman, D. (1986). Rational Choice and the Framing of Decisions Rational Choice and the Framing of Decisions*. Source: The Journal of Business The Behavioral Foundations of Economic Theory, 59(2).
Zhang, Z. (2019). The effect of library indoor environments on occupant satisfaction and performance in Chinese universities using SEMs. Building and Environment, 150. https://doi.org/10.1016/j.buildenv.2019.01.018
Journal of Sustainable Human Resource Management
Volume 6, Issue 10
April 2024
Pages 87-71

Files

Share

How to cite

Statistics