Professional Documents
Culture Documents
MGT 672
Submitted by:
Marjan Farooque
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Reward System and Organization Culture Used as Motivation for The Employees to
Perform
Motivation:
Motivation is characterized as the procedure that starts, manages, and keeps up objective
arranged practices. Motivation is the reason that makes the people act or behave in a particular
way. Robbins and Judge (2009), defined motivation “as the processes that
Motivation
Motivation
Intensity refers to the amount of mental and physical effort put forth by a
which the goal-directed effort is put forth over time. There are many theories
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of motivation, including early theories and contemporary theories. Early
Douglas McGregor theories X and Y, the two factor theory, and McClelland’s
theory of needs.
esteem, and self-actualization. When one need is satisfied the person moves
Model 1:
Extrinsic
Rewards
system
Motivation
to perform
Intrinsic
Strong
organization
al culture
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As we can notice from the model, motivation to perform is influenced
by reward system.
Assumption 5: High performance culture Employees are more likely to succeed in their job roles
than others.
First the report is going to explain the reward system then we will talk about
they should have the capacity to check with roused and upbeat employees,
who will perform their best and who will be prepared to offer the organization
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some assistance with achieving its objectives. Motivating employees to
fact that not all workers are motivated by the same reasons. Few employees
are more motivated when they feel that they are picking up something out of
their diligent work, similar to cash, more advantages, or any sort of prize.
Different workers are motivated when they feel their organization and
rewards. They are normally money related in nature, for example, a rise up
in compensation, and a reward for reaching some quota or limit or paid time
doing something that they love and getting paid for it.
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employee motivation. This is not to say that employees won't look for
with all forms of final returns, tangible service and mechanism for good
arises when employees feel that their benefit are denied or about to be
for example, paid leave, protection, retirement pay and different worker
courses of action, for example, working from home and strategic scheduling
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that employees may see as advantages and covers the mechanism of
Non-compensation rewards are beneficial factors related to the work situation and well-
being of each employee. Provide adequate resources to do the job. Allowing the people control
over their own activities. Non-compensation rewards can include benefits (including medical or
other insurance), time off, flex time, mentoring programs, tuition assistance, childcare, gym
membership discounts, free or discounted parking and retirement matching. These advantages
impart to employees that their work is esteemed and advance a positive work-life parity. The
thought behind advantages is to assemble a group and emotionally supportive network, which
empowers employees to concentrate on work instead of stress over life (Boundless, 2015).
Under the compensation and non-compensation rewards falls the financial and non-
financial rewards. There are various types of financial and non-financial compensation that
equally motivates the employees to perform efficiently and effectively towards the
Financial Rewards:
Straight Salary: It is a compensation method where only fixed salary is paid based on
flat hourly, weekly or monthly rate. Salaries on this method is very easy to administer. Salaries
provide control the employees activities and reassignments are less of a problem. Salaries can be
useful when substantial development work is required. On the other hand straight salary method
offers little incentive for better performance. Salary compression usually causes perceptions of
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Straight commission: As stated in Business Dictionary (2015), it is a
method where the income is directly linked to the desired results. The
not of real time worked) reflected in sales volume. This technique is utilized
where the goal is to (1) produce most extreme transient deals income at the
employees.
(2014), among all the financial rewards performance bonus motivates the
task or goal to fulfil. When the employees know if they fulfil this goal they
are going to be paid extra they start working much harder and put more
effort towards fulfilling that goal. As performance bonus is an extra pay with
including their basic salary it makes the employees more efficient and
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effective towards their job which in return helps the organization to benefit
from it.
Non-Financial Rewards:
employers who need to perceive their employees for good work have
efficiency high. New employees can see the potential for development. If the
employees feel that there is a potential career path available within their
current organization, they will start working hard towards achieving that
point and this way the organization is less likely to lose promising efficient
(Greenwood, 2015).
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accomplishment. When the employees are empowered to take action, it
gives them the ownership of their job. The empowerment helps them to
stage and take an interest in joint decision making. In quality circles, less
than ten employees meet with their administrator to talk about and discuss
accomplishment and at last increase the employee motivation level and job
making can create group viability and results in a better decision. The
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chance for adapting so as to build up their professions aptitudes, advances
and skills fundamental for execution change and advancement, they will feel
that the course of action will not only lead to accomplishment of goals but
yet brings about more noteworthy chances for their advancements. The
self-esteem and self-actualization. Thus, they can achieve the most positive
performance. Level with open doors for professional success and "equitable"
behavior. In this way, when employee wishes or desires are adjusted to the
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advantages that the employees anticipate for themselves are satisfied via
type of recognition system. The organization can perceive their workers for
and even a night or two as a visitor in a hotel. These grants are intended to
fortify employee practices that bolster and support the organization's central
goal. Honors like these can plainly exhibit that the organization appreciate
and value their employees and their work endeavors (Sturman & Ford,
2011).
memorable experience. Not only does the employee have the award itself,
but that individual has sentiments of pride from getting a plaque, enduring
than what you'd get from receiving an equivalent amount of money. For
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may cost just $20, however the enthusiastic effect of accepting a trophy is
far more noteworthy than that of essentially getting a $20 bill. The trophy
whatever length of time that they wish to hold it. At the point when
organizations need to show that they have a security towards their job. They
motivate employees most as the employees feel more motivated when they
see their work is being appreciated and recognized in front of the whole
rewards don’t last forever but appreciation or any kind of award stays
forever.
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Organizational Culture and Performance
Todays’ business world is being governed by many forces. These forces determine how a
researchers had been working really hard to understand the factors that drives performance of an
organization. Assuming all inputs like industry condition, economic climate, investment
what can be changed to gain competitive advantage over the competitor. Is it the marketing
strategy, brand management? Or is it the skill of the sales force? Does it have anything to do
with creativity and productivity of the employees? Or is it the leadership that makes the
difference. Well, all of them are correct. The key to perform better is actually is in the hands of
the organizations. Regardless of the nature or type of an organization, every organization have
something in common. That is the organizational culture and Human Resource specialists had
been claiming this for some time now that Organizations Culture is the key to drive performance.
Organizational Culture
Culture is the abstract phenomena that governs how a group of people will live their life
like. It consists of how they speak, what their values and beliefs are, what sort of behavior they
generally accept and expect, and the composition of ideologies that drive them. The way they
react and shows behavior toward something without thinking is because of the influence of the
culture they live in. This culture is fostered over many past generations and carefully carried by
the present members so that they can pass it onto the next generation. It is an ever evolving,
fascinating feature of human society that researchers still trying to fathom its depth.
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In an organization, people come together to achieve a common goal and they also bring
elements from the society they are from to form a separate type of culture. This is known as
organizational culture. Over the years, organizational culture been defined by many researchers
in many different ways. Like organizational culture is the set of common set of values, norms
and beliefs that makes the people behave in a certain way that they do (Schein, 2011). According
to Hofstede (1980) organizational culture is the shared values, beliefs and practices that
distinguishes one organization from another. Martin & Siehl (1983) compared organizational
culture with glue. They said organization culture is the adhesive that holds an organization
together and it has 3 components (core values, process of communication and strategies to
reinforce content). Denison (1990) indicated that organizational culture as the primary
assumptions, beliefs that serves as a basis for an organization’s management system. Some
the interpretation of that behavior (Schneider, 1997). Some other described it as an informal,
abstract way that binds people in an organization and that determines what each other think
about themselves (Wagner, 2005). So we can say that organizational culture is something that
includes everyone in an organization, determined by the people of the organization and their
Research shows that there are seven primary characteristics that expresses the principle of
Innovation and risk taking: Does the organization encourage risk taking and demands for
Attention to detail: Does the organization ask for precise, detailed style of work?
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Outcome Orientation: Is the management outcome oriented rather than way/technique to
People Orientation: Is the management bothered about effect of outcome on the people
Team Orientation: What sort of work style the management promotes most –
These characteristics shows that organizational culture actually determines the attitude of
the organizations people. When a person starts working with a group of people he will start
learning what is expected from him. He will learn how the rest of the people are behaving and he
will shape himself along with that. So that’s why people coming from different walks of life
behaves similarly within an organization. It is because that sort of behavior is asked from him by
the management. There are two types of organizational culture that exists in an organization.
One is dominant culture, which is shared by the majority of the people. This is the culture where
organizations values, norms and beliefs are shared broadly. The other one is the sub culture,
smaller groups of people share a smaller set of culture across departments or geolocations of that
organization.
Performance
Generally, in a business organization performance refers to how the organization and its’
people are doing in its mission to attain the goals. Performance can be varied to financial or non-
financial measures or it can be hybrid of the both. ROI, ROE, stock price, profit, sales turnover,
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overhead cost reduction of a plan etc can be examples of financial performance. On the other
hand, image of the organization, awareness of the brand, public relations, employee retention and
motivation can be examples of non-financial performance of the organization and its’ employees.
Two organizations operating in the same industry, serving the same market may perform
differently. The reason is their individual performance. It’s because of the performance for which
two companies will experience two different outcomes in the same period of time, one being
good and other being bad. Performance is an important issue for any organization be it profit or
non-profit organization. We can look at performance from two different perspective- individual
performance may depend on numbers of factors like compatibility of the person, experience,
knowledge on specific field, motivation of the person, benefits and rewards the person is
receiving from the organization and so on. Overall organization performance can be dictated by
the industry climate, the market share, image of the organization, past record or history of
organization, leadership practice in the organization etc. But both of them can be influenced by a
strong medium that is unavoidable in any organization – the organization’s culture. This is such a
strong phenomenon in the business that researchers and managers are trying to understand it
Many scholars have found positive relationship between organizational culture and
performance. Profit is the ultimate outcome an organization seeks and this is the result of
individual efforts that employee put in together. Stewart (2007) stated that, the work culture
determines the outcome for an organization and the strongest element of the work culture is
its’ member belief and attitude toward work. People make up the culture and it carries through
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them. If an organizations values contain such belief that ‘if it’s not broken don’t fix it’ the
employees performance will reflect this value. On the other hand, if the culture has such a
component that states that ‘hard work is rewarded here’, the employees will act in favor of that
belief.
Strength wise organizational culture can be either strong or weak. When organizations’
core beliefs and assumptions are both deeply believed and extensively shared then it can be
assumed that that culture is a strong culture. More people accepting core values of an
organization indicates the strength of their commitment to these values. Strong culture creates
because it leads to employee cohesiveness and loyalty. A weak culture is just the opposite
when values are weak and employees feel like loosely connected to each other and with the
organization and its goals. According to the text book by Robbins, S. P., & Judge, T. A. (2010)
there are four types of culture based on competing values. Those are collaborative and
cohesive clan, adaptable adhocracy, controlled and consistent hierarchy and customer focused
market. This Competing Values Framework was proposed by Quinn and Rorbaugh (1983).
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Clan is more flexible than others and the do not put much emphasis on structure. People
are motivated by common goals and shared belief. These type of organization often act like a
family and the leaders are often take up the role of a guardian. Adhocracy enjoys more
flexibility than the clans. They have greater freedom because they adapt to swiftly changing
business environment. Their market response is fast and quickly changes shape to answer calls
from the market. Innovation and fast reaction is key to success here and dynamic entrepreneurs
are examples of leaders of this kind. Hierarchy are the classical bureaucratic organization that
follows strict chain of command rules. It is very structured and workflow & communication is
very controlled. They usually have strict guidelines for every aspect of an organization and the
leaders are usually the chief coordinators. Market organizations are those who also like to
impose heavy control but does so by looking outward. They are driven by result and market
responsive. In a market culture organization value flows between people and stakeholder with
minimal cost and delay. Studies found that, clan based cultures specializes in job attitudes and
loyalty. It means if the leaders demand to go the extra mile from the employees of clan culture
organization, they will probably do that out of self-obligation. Clan culture organization
functions like a family so retention rate is high. The study also shows that, innovation is high in
market culture and so is the financial outcomes. Since market culture is highly market responsive
and functions with high competency it demands such performance from its’ members.
Denison (1990) came up with a model that explains cultural traits of an organization. In
his study he connected management practices with organizational norms and beliefs. He
proposed that organizations’ performance is the function of beliefs held by the members of that
organization. He also stated that strength of those values and beliefs are the actual predictor of
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Denison’s culture model is based on four cultural traits. Each trait has several indexes.
Those are:
At the center of the model there is beliefs and assumptions. The four cultural trait spring around
Mission: long term objective of the organization. This trait consists indexes like Strategic
Direction & Intent, Goals & Objectives and Vision. This part indicates are the employees aligned
with company’s mission and vision? Is their personal goal aligned with organizational goal? Do
they fully understand the direction the company is going and do they agree with it? A successful
organization will always have clear mission and vision. They will also make sure the employees
are fully communicated on this agenda and their commitment is there with organizations mission
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and vision. If organization changes direction of their mission/vision, the culture has to adjust
Adaptability: Organization’s responsiveness toward the market. The indexes are creating
change, customer focus and organizational learning. This trait asks questions like do the
members have the intent to improve the way they work? Are they customer focused? Is the
organization share knowledge across departments/divisions? Do they give innovation and risk
taking any chance? A successful organization will always be customer focus. They will learn
what market is demanding and answer quickly with innovation. Sometimes they will go the extra
Involvement: Developing sense of ownership and competence among the members. The
indexes are Empowerment, Team Orientation and Capability Development. This trait indicates
towards issues like are the employees feeling like they are part of the organization? Do they
work with ownership? Does the organization promote team orientation and team achievement?
Are employee capabilities are developing? An effective organization who asks for higher
performance from their employees will give the employees the feeling that they are empowered.
They will develop a culture around team where everyone is equally accountable for achieving the
desired goal. Every employee will feel like they are directly connected to the ultimate
achievement.
Consistency: Strength of the core values of the organization that is also highly
consistent. The indexes are Core Values, Agreement and Coordination & Integration. This trait
of the organization refers to whether the leaders are strong role models for conveying the values?
How well and effectively the members coordinate and reach to an agreement in times of critical
issues? A high performing successful organization is always well coordinated and well
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integrated. Companies that can react quickly among the diverse views of members and reach to
All of these traits are available in all sorts of organization. The performance of that
organization will be determined how high they score among these traits and what is the mix they
use to achieve their goal. Organizations that score high in adaptability and involvement are
known to be flexible. They are known to be quickly responsive to environment and serve their
customers with innovation and speed. Organizations that score high in mission and consistency
are known to be more stable. They have set of rules that the go by and known to be efficient and
financially profitable. On the other spectrum, organizations that score high in adaptability and
mission assumed to have external focus. They observe the market closely and react accordingly.
As a result, they obtain a steady growth as they satisfy the present market demand and also keep
predicting the future. Organizations that score high in involvement and consistency are known to
have internal focus. They align their processes and people to achieve operational excellence,
Conclusion:
At the end it can be said that the aim of this paper was to explore the
reward system and organization culture, that affect the motivation of the employee
Managers should find the perfect balance to create the best motivation
technique that will benefit the employees and the organization as a whole.
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There are two types of rewards financial and non-financial, which
equally motivates the employees to perform well and give their best to boost
up the organizational benefit. Among the financial rewards falls the straight
job security and recognition. Among all the factors recognition plays the
motivated to perform well when they see that their work is being recognized
As far as organization’s profitability is concerned it is the function of how all units of that
organization is performing to attain their respective goals matters. Units’ goals can be achieved
when their members perform accordingly. Their performance is dependent on the competency to
perform the job and their job attitude. So when management is concerned about the performance
of an organization they should look inside what is shaping the attitude of the members toward
their jobs. Organizational culture should be scrutinized and emphasized when leaders want to
organizational culture is an underrated topic of human resource practices but it deserves more
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