The Relationship between Rewards and Recognition of Employees Contribution: A Literature Review

TIMESINDONESIA, MALANG – Human resource is the most important assets among other resources. Therefore, the challenge for each and every organization is to insure that their employees are highly motivated. The level of motivation of employees is connected to an effective system of rewards and recognition (Arnold and Feldman, 1986). 

The concept of reward and recognition has gained much importance in the current times and has captured the attention of organizational managers and researchers equally (Mandal & Dalal, 2006). Resultantly, around the world in different organizations, reward and recognition are used as motivational techniques for employee’s better performance.

Reward is used as an appreciation of certain behavior in the shape of monetary or non-monetary incentives after certain accomplishment or a success. Recognition is the sense which is given to an individual for being a valued person of an organization. 

The strong relationship between reward and recognition and its importance for job satisfaction of employees has also been explained by various theorists from around the world. These theories deal in detail with the concept of reward and recognition and employee’s motivation and job satisfaction. 

Maslow’s Need Hierarchy Theory 

According to this theory there are two types of needs. Lower level and higher level needs. Lower level needs are the basic biological human needs such as food, shelter, sex and dress while upper level needs are those which individual strives to achieve after the satisfaction of the lower level such as self-esteem and selfactualization.

In his theory Maslow (1943) also discusses that employees can be motivated by satisfying their needs. In work setting employees are motivated through recognition, an increase in responsibility, high status, appreciation and positive feedback. 

According to Maslow (1943) needs emerge as a hierarchy. When lower level needs are satisfied in the hierarchy, individual strive for the next level. We can say that when physiological, safety and social needs are satisfied, the individual strives for selfesteem and self–actualization.

Hence, Maslow’s hierarchy theory broadly supports the concept that reward and recognition (basic needs) and (self-esteem needs) of employees, if met, lead to satisfaction of the particular employee. The theory says that needs at different hierarchy level reflect reward and recognition.

For example, physiological needs represent the tangible reward in the shape of salary and food. Social needs are intangible rewards provided by colleagues and superiors in the shape of encouragement, appreciation and positive feedback. Similarly, an individual strives for recognition which increases his / her selfesteem. 

Hertzberg Two Factor Theory 

Hertzberg (1959) explored motivation by offering Two Factor Theory. He divided the factors of motivation in two categories such as Satisfiers or (motivators) and Dissatisfies or (hygiene). According to Herzberg, satisfiers or motivators are intrinsic motivational factors which are related to job itself and internal to individual such as, recognition, development and responsibility.

It also corresponds to Maslow’s motivation or need hierarchy theory where self-esteem is an upper level need. Dissatisfaction or hygiene are extrinsic motivational factors which remove dissatisfaction such as salary, working condition and relationship with colleagues. It reflects Maslow’s lower level or physiological needs.

The Herzberg theory constitutes the same framework in support of the argument of reward and recognition and its effect on employee’s job satisfaction as constituted by Maslow’s hierarchy theory. The motivating factors reflect selfesteem which is actually recognition.

Aldefer’s ERG Model 

Alderfer (1972) modified Maslow’s theory divided the need hierarchy into three basic levels such as Existence Needs (incentives and physical requirements such as pay, security and working conditions.), Relatedness Needs (need for social relations such as relationships with family, friends and colleagues) and Growth Needs (self-fulfillment, the desire for career growth development and competency).

According to this model all the basic needs motivate behavior at the same time and might not emerge like Maslow’s Need Hierarchy Theory. It means that any need emerges any time to motivate employees regardless of the fulfillment of the other need. It can be argued that the three levels of needs in the ERG model represent reward and recognition.

Existence needs such as pay and incentives corresponds with reward. Relatedness needs like social relations (family, friends and colleagues) correspond with recognition. Thus reward and recognition motivate employees regardless of any hierarchy.

In conclusion, there is significant relationship exists between reward and recognition and job satisfaction of employees. All the four motivation theories analyzed in this study directly or indirectly emphasize upon employee’s job satisfaction through reward and recognition. This study also finds out that in organizations individuals choose such roles which result in greatest benefits to them. 

Therefore, the study recommends that job satisfaction must be tied to rewards and recognition because employees achieve satisfaction and happiness when they put their energies fully in their activities. This study strengthened the belief of the researcher on the basis of the review of theories that job satisfaction of employee’s is the result of motivation. 

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*) Oleh: Santri Maharani, a student of Post Graduate of Muhammadiyah University Malang.

*) Tulisan Opini ini sepenuhnya adalah tanggung jawab penulis, tidak menjadi bagian tanggung jawab redaksi timesindonesia.co.id

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