Employee reward systems are widely regarded as essential tools for attracting, retaining, and motivating employees within organizations. Traditional perspectives emphasize financial incentives as the primary driver of employee performance; however, recent studies suggest that non-financial rewards may play an equally or even more significant role in enhancing motivation and productivity. This study examines the effects of reward management policies on employee performance, with particular attention to both financial and non-financial reward mechanisms. It challenges the long-standing assumption that monetary compensation is the most effective motivator by exploring alternative reward strategies such as recognition, career development opportunities, and workplace environment improvements. Evidence from prior research indicates that employee motivation is multifaceted, and reliance solely on financial rewards may, in some cases, lead to diminishing returns or even demotivation. The study highlights the importance of a balanced reward system that integrates both intrinsic and extrinsic motivators to optimize employee performance. The findings contribute to a broader understanding of how modern reward management practices influence employee attitudes, motivation, and productivity in organizational settings
Michael J. Harrison (Wed,) studied this question.