For today’s globalized companies, the problem of how to effectively motivate staff is becom-ing more and more vital. During the last decades, a vast number of incentive schemes and bonus plans have been developed by researchers and are applied in daily business. By now organizations have realized to appropriately view employee rewards as a kind of key investment, rather than one of their largest expenses. But why do people put so much effort in researching and ascertaining incentive systems? Companies want to ensure that good and well-trained employees do not leave the company and they are desperately trying to avoid the recruitment of new professionals. To reach these goals companies should use the inter-dependencies of linking rewards, results, and employee motivation, which can be one of the most value-added human capital strategies (Chen/Hsieh 2005, p. 155).
In the meantime the process of globalization is accelerating this development. The growing demand for highly skilled employees is intensifying the competition for workers in certain specialized industries and regions. On the other hand companies are expanding to new markets and countries in order to secure future business success. This dynamic has a direct im-pact on the value employers are placing on retaining employees and increasing employee productivity as well.
The key questions to be answered in this context are: If an organization moves to multinational areas, do any problems in designing rewards arise due to different cultural under-standings? And if so, what is seen as motivating in specific cultural environments and what can be seen as non-motivating in multinational firms and international joint ventures?
In order to answer these questions I will justify the use of rewards and incentives based on a description of frequently used work motivation theories. Additionally I’m going to examine the scientific models for a certain ‘country-compatibility’. In a second step I will go into more depth by defining and differentiating between types of rewards. Furthermore I’m going to put my findings into a global context by introducing a theory which involves the influence of culture or cultural variations on organizational dynamics and employee performance.
Table of Contents
1 Introduction
2 Motivation Theories and their Country-Compatibility
2.1 Herzberg’s Two-Factor Theory
2.2 Maslow’s Hierarchy of Needs
3 Application of Reward Systems
3.1 Different Types of Reward Programs
3.2 Incentive Systems Applied in Different Cultures
4 Conclusion
5 Appendix 1
6 Appendix 2
7 Appendix 3
Research Objectives and Core Themes
This work aims to investigate the necessity of cultural adjustments when designing employee reward systems in a globalized business environment, focusing on how different cultural understandings influence what motivates staff. The study evaluates traditional motivation theories against global workforce realities and explores how organizations can align reward strategies with specific cultural contexts to enhance employee performance and retention.
- Critique of traditional motivation theories regarding their "country-compatibility."
- Categorization and differentiation of various financial and non-financial reward programs.
- Analysis of the influence of national and cultural characteristics on organizational incentive structures.
- Evaluation of empirical trends in employee benefits across diverse international markets.
- Development of a holistic view on integrating culture into human capital management strategies.
Excerpt from the Book
3.2 Incentive Systems Applied in Different Cultures
As we know, reward and incentive systems are getting more and more in focus of today’s companies. Anyhow, the demographical change influences and affects companies and businesses as well. Increasing longevity and falling birth rates in Germany, Australia, US and UK lead to new challenges. Those countries can all be characterized as mature economies, whose demographic trends and challenges stand exemplary for all developed nations around the world.
Based on a representative study conducted by the Metropolitan Life Insurance Company (MetLife) in 2007, there is a new trend regarding the incentive employees systems. The survey focuses on the new economies in Asia or the Americas. They serve as an adequate sample of different economic and workplace environments of rapidly growing nations. Beside the prescribed well-known employee benefit programs and financial incentives, the study found that benefits programs supplied by employers in these newly industrialized countries often end up in filling gaps in national health and retirement systems (MetLife 2007, p. 1).
As we can see, beside the prescribed benefits in chapter 3.1, insurances for health, medical issues, and other social topics seem to play a major role in employee’s life. We also perceive that benefits are differencing from country to country and reflect cultural disparity. In my opinion the respective employee incentives are addressing basic needs, or to say it in Maslow’s words so called safety needs. The majority of benefits are aiming at a long-term relationship with employees and won’t be applied to reward any temporary success.
Chapter Summaries
1 Introduction: This chapter defines the core problem of motivating staff in globalized companies and establishes the necessity of exploring cultural impacts on reward systems.
2 Motivation Theories and their Country-Compatibility: This section reviews Herzberg’s Two-Factor Theory and Maslow’s Hierarchy of Needs, critically assessing their limited applicability across different international institutional frameworks.
3 Application of Reward Systems: This chapter categorizes common monetary incentive programs and examines how specific cultural factors, such as historical events and language, moderate the effectiveness of these systems in various countries.
4 Conclusion: This chapter synthesizes the findings, emphasizing that effective reward programs must be custom-made to fit an organization's specific cultural context and employee needs.
Keywords
Employee Motivation, Incentive Systems, Reward Programs, Cultural Influences, Herzberg, Maslow, Globalization, Human Resource Management, Variable Pay, Performance Management, Country-Compatibility, International Business, Corporate Governance, Employee Retention, Organizational Dynamics
Frequently Asked Questions
What is the primary focus of this research?
The work focuses on the challenges of effectively motivating employees in multinational companies, specifically examining how cultural differences necessitate adjustments in the design of reward and incentive systems.
What are the central themes of the work?
The central themes include the critique of Western-centric motivation theories, the classification of various reward tools (financial and non-financial), and the impact of national environment on organizational dynamics.
What is the research goal of the paper?
The goal is to determine if traditional motivation theories are universally applicable and to understand how companies can design "country-compatible" rewards that align with local values and employee needs.
Which methodology is applied?
The paper uses a descriptive and analytical approach, synthesizing existing literature on motivation theories and examining empirical studies and trends in global employee benefit programs.
What is addressed in the main body?
The main body covers the analysis of Herzberg and Maslow, detailed descriptions of specific reward mechanisms like profit sharing and stock options, and the application of these concepts within different cultural environments.
Which keywords characterize this work?
Key terms include motivation, reward systems, cultural influence, country-compatibility, job satisfaction, and performance-based compensation.
Why does the author consider Maslow's theory not a "panacea"?
The author argues that Maslow’s hierarchy is culturally biased and that needs are prioritized differently depending on the country, economic status, and profession of the employee.
How do historical events influence incentive systems according to Huo and Steers?
Huo and Steers suggest that major historical events disrupting political stability often lead to a greater demand for group-based incentive systems due to changes in a nation’s communal spirit.
What role does language play in reward preferences?
The research notes that languages with high ambiguity (equivocality) correlate with a preference for less specific, non-confrontational reward systems compared to cultures that favor precise performance metrics.
What is the significance of "Thank You" as mentioned in the conclusion?
The author emphasizes that beyond formal incentive programs, simple, personal, and immediate recognition is an essential and universally effective tool for motivating employees.
- Arbeit zitieren
- Diplom-Kaufmann Sebastian Wagner (Autor:in), 2014, Leadership and job motivation in international corporate governance, München, GRIN Verlag, https://www.hausarbeiten.de/document/272860
