Impact of the total reward management on performance of employees in commercial banks

Abstract

This study examines the impact of total compensation management on employee performance in commercial banks. It considers the total compensation system elements, such as equality in financial rewards, effects of non-financial rewards, and other factors as operational and control tools used to align organizational and employee goals and improve performance. For this study, 129 questionnaires administered to Kosovo commercial bank employees were analyzed. Statistical methods used in this paper are principal component analysis and ordinary linear regressions. One of the most important findings of this research is that financial incentive is the most important determinant of employee performance, increasing employee performance by 30 percent. The research results also indicate a significant relationship between equal employee compensation and pay for work of equal value. A significant relationship between non-financial factors has also been identified, including career development opportunities and benefit packages, such as pension funds, holidays, and loans specifically discounted for commercial bank employees. It is important to note that employee performance decreases with other factors, such as competition in the labor market.

Keywords

• employee performance
• reward
• compensation
• benefits