MSc Dissertation ZsuzsannaSzucs-1218863

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Brunel Business School
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IMPACTS OF REWARD SYSTEM ON
CUSTOMER SERVICE EMPLOYEES’
MOTIVATION AND ITS OUTCOMES ON THEIR
AFFECTIVE ORGANIZATIONAL
COMMITMENT
Name: Zsuzsanna Szucs
Student Number: 1218863
Course: MSc Management
Department: Brunel Business School
Supervisor: Dr Goudarz Azar
Submission Date: 12 September 2016
Word Count: 12 835

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ABSTRACT
Purpose – The aim of this research project is to investigate the human resource
management outcomes of reward systems among customer service employees in the UK. The
study in-depth examines the impacts of financial and non-financial rewards on employee
motivation and affective organizational commitment. The significant indicators of these
variables as well as the relatedness of employee motivation and organizational commitment
were identified.
Methodology – Both primary and secondary data were utilised in the investigation in order
to address the objectives of this study. Implementing a quantitative, survey method, snowball
sampling was carried out to employees holding part- or full-time customer service position in
the UK, aged 18 and above, with a sample size of 145. In order to test the developed
hypothesis Multiple Linear Regression analysis was carried out with control variables of age
and employment status (part- and full-time).
Results – The key findings revealed that customer service employees’ motivation is
significantly predicted by both financial and non-financial rewards. Particularly, fringe
benefits, pleasant working condition, friendly supervision and opportunities for career
development were found to show the strongest relationships. In contrast to the literature,
these results indicate the importance of hygiene factors in motivating labour-force.
Examining affective organizational commitment, monetary rewards did not show significant
results, while non-financial rewards, namely recognition, friendly supervision and autonomy
exert high levels of influence on front-line employees. Finally, the study highlights that
motivated workforce show higher willingness to share the organizational values and put extra
efforts on behalf of the organization to achieve its vision. Consequently, offering those
rewards that highly impact their motivation will advance the growth of their affective
commitment.
Conclusion – Based on the findings, recommendations were proposed to enhance front-line
employees’ motivation and affective organizational commitment. It was suggested to put
emphasis on the nature and level of non-financial rewards offered to workers since those
were found to be the strongest significant indicators of the dependent variables.

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ACKNOWLEDGEMENTS
First of all, I would like to express my sincere gratitude to my supervisor, Dr Goudarz
Azar for his excellent guidance throughout the whole progression of my dissertation.
Besides, I am grateful to all Brunel Business School lecturers who have taught me during
my studies and the tremendous help of the Graduate School tutors and Brunel University
librarians.
I would never have been able to finish my dissertation without the continued support of
my beloved parents and my brother who have been always there to encourage me. Also,
many thanks go to all of my friends for their understanding and patience.
Lastly, I would like to thank the help of all participants who completed the questionnaire
and all of those who forwarded it to identify potential further respondents.

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CONTENTS PAGE
1. INTRODUCTION
1.1 Introduction .................................................................................... 9
1.2 Background and Research Justification ............................................... 10
1.3 Aim and Objectives ......................................................................... 11
1.5 Chapter Synopsis............................................................................. 12
2. LITERATURE REVIEW
2.1 Reward Systems .............................................................................. 13
2.2 Motivation Theories......................................................................... 15
2.2.1 Maslow’s Hierarchy of Needs .................................................. 15
2.2.2 Herzberg’s Two-Factor Theory ................................................. 16
2.3 Impacts of Rewards on Employee Motivation ...................................... 17
2.3.1 Financial/Transactional Rewards .............................................. 17
2.3.2 Non-financial/Relational Rewards............................................. 18
2.4 Organizational Commitment .............................................................. 21
2.5 Impacts of Rewards on Affective Organizational Commitment .............. 22
2.6 Relationship between Employees’ Motivation and their
Affective Organizational Commitment................................................ 27
2.7 Conceptual Research Framework....................................................... 28
2.8 Chapter Summary ............................................................................ 28
3. RESEARCH METHODOLOGY
3.1 Research Philosophy ........................................................................ 29
3.2 Research Approach.......................................................................... 30
3.2.1 Deductive or Inductive............................................................. 30
3.2.2 Qualitative or Quantitative........................................................ 30
3.3 Research Method............................................................................. 30
3.3.1 Primary or Secondary Data ...................................................... 30
3.3.2 Questionnaire.......................................................................... 31

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3.4 Measurements ................................................................................. 31
3.4.1 Independent Variables ............................................................. 32
3.4.2 Dependent Variables................................................................ 34
3.4.3 Control Variables .................................................................... 35
3.5 Sample Selection and Data Collection ................................................ 35
3.6 Pilot Study...................................................................................... 36
3.7 Data Analysis .................................................................................. 36
3.8 Limitations ...................................................................................... 36
3.9 Ethical Considerations...................................................................... 37
3.10 Chapter Summary........................................................................... 37
4. FINDINGS AND ANALYSIS
4.1 Demographic Profile of Respondents ................................................. 38
4.2 Multiple Regression Analysis ............................................................ 39
4.3.1 Evaluation of the Reward Package Elements ............................... 43
4.4.1 Evaluation of the Reward Package Elements ............................... 46
4.6 Chapter Summary ............................................................................ 48
5. DISCUSSION
5.1.2 Evaluation of the Control Variables........................................... 52
5.2.3 Evaluation of the Control Variables........................................... 56
5.4 Chapter Summary ............................................................................ 57

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6. CONCLUSION AND RECOMMENDATIONS
5.1 Conclusion...................................................................................... 58
5.2 Managerial Implications.................................................................... 60
5.3 Suggestions for Future Research ....................................................... 60
REFERENCES ....................................................................................... 61
APPENDICES
Appendix A.......................................................................................... 76
Appendix B.......................................................................................... 79

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LIST OF FIGURES
Figure 2.1 Components of Reward Systems......................................................................14
Figure 2.2 Maslow’s Hierarchy of Needs.........................................................................15
Figure 2.3 Three Dimensions of Organizational Commitment..........................................21
Figure 2.4 Research Framework........................................................................................28
Figure 3.1 Towers Perrin Model.......................................................................................32
Figure 4.1 Age of Respondents..........................................................................................38
Figure 4.2 Gender of Respondents.....................................................................................38
Figure 4.3 Normal Probability Plots of the Regression Standardized Residuals...............40
Figure 4.4 Scatterplot of Regression Standardized Residuals............................................40

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LIST OF TABLES
Table 2.1 Applying Maslow’s Hierarchy of Needs at the Workplace ..............................16
Table 2.2 Herzberg’s Two-Factor Theory.........................................................................16
Table 3.1 Scales of Financial Rewards..............................................................................32
Table 3.2 Scales of Non-Financial Rewards .....................................................................33
Table 3.3 Scale of Employee Motivation...........................................................................34
Table 3.4 Scale of Affective Organizational Commitment................................................35
Table 4.1 Employment Status of Respondents..................................................................38
Table 4.2 Intercorrelation Matrix among Variables...........................................................39
Table 4.3 Model Summary of MLR on Employee Motivation..........................................41
Table 4.4 ANOVA of MLR on Employee Motivation ......................................................41
Table 4.5 Regression Coefficients – MLR on Employee Motivation................................42
Table 4.6 Disintegrated Model – Reward Package Elements on
Employee Motivation........................................................................................43
Table 4.7 Model Summary of MLR on Affective Organizational Commitment...............44
Table 4.8 ANOVA of MLR on Affective Organizational Commitment ...........................44
Table 4.9 Regression Coefficients – MLR on
Affective Organizational Commitment .............................................................45
Table 4.10 Disintegrated Model – Reward Package Elements on
Affective Organizational Commitment...........................................................46
Table 4.11 Model Summary of MLR on Employee Motivation and
Table 4.12 ANOVA of MLR on Employee Motivation and
Table 4.13 Regression Coefficients – MLR on Employee Motivation and

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Chapter 1
INTRODUCTION
1.1 INTRODUCTION
Given today’s highly competitive business environment where the demands and expectations
of the customers have significantly increased during the past few decades; ongoing cost
pressures and continued slow growth force businesses to consider the sustainability and
competitiveness of their labour force and talent strategies. It has been recognised that success
of an organization depends on its employees, namely those who are motivated and engaged
with the organizational vision, mission and values. However, misconceptions about what
employees really want still exist, which make management practices inefficient to deliver the
desired outcomes (Towers Watson, 2012).
According to Armstrong and Taylor (2014) a reward strategy is driven by the business
strategy which ensures that reward management is carried out effectively to the benefit of the
organization and the employees who work there. Employee motivation is crucial aspect of
management, since it encourages workers to do their best to fulfil their work duties and put
extra efforts to complete the tasks given to them at the workplace (Armstrong and Taylor,
2014). Whereas, employees’ organizational commitment is a broader concept since it is
associated with their sense of attachment to and identification with the organization
(Mowday, Porter and Steer, 1982), while affective organizational commitment can be seen as
the workers’ willingness to display effort on behalf of the organization and support to
achievement of the organization’s strategic goals by helping to communicate its values and
performance expectations (Meyer and Allen, 1997).
Therefore, reward management has a vital role in not only attracting and retaining high
potential employees, but also motivating them to act in the best interests of the business (Fay
and Thompson, 2001). In return to their efforts, employees need to be rewarded in a way that
makes them feel valued and appreciated for their work. Social Exchange theory suggests that
the more favourable the reward to the employees the more it generates the desirable
behaviours (Chiang and Birtch, 2012). However, in reality insufficient attention is given to
employee preferences for different types of rewards (Cox, Brown and Reilly, 2010).

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1.2 RESEARCH BACKGROUND AND JUSTIFICATION
Research studies on how reward systems affect employee motivation (Ahamad et al., 2015;
Cameron and Pierce, 1994; Cox, Brown and Reilly, 2010; Brown, Hewett and Conway,
2015; Hewitt and Reilly, 2013; Fay and Thompson, 2001; Harel and Tzafrir, 1999; Rynes,
Gerhart and Minette, 2004; Shaw and Gupta, 2015) and organizational commitment (Angle
and Perry, 1983; Benson, 2006; Farndale and Murrer, 2015; Kinnie et al., 2005; Mottaz,
1988; Ogilvie, 1986) are broad and general but many researchers argue that employees’
behaviour needs to be understood in a specific research context (Cox, Brown and Reilly,
2010; Fay and Thompson, 2001; Kinnie et al., 2005 and Shaw and Gupta, 2015).
Despite the vast literature on the context of physical workers (Angle and Perry, 1983;
Kovach, 1987; Fein, 1973; Newman and Sheikh, 2012b; Young, Worchel and Woehr, 1998),
and intellectual labour (Ahamad et al., 2015; Chew and Chan, 2007; Hewett and Conway,
2015; Kanungo and Hartwick, 1987; Kuvaas, 2006; Nazir et al., 2016; Ogilvie, 1986; Paul
and Anantharaman, 2004); there is limited research on how different rewards affect the
motivation and organizational commitment of emotional, front-line labour. In the growing
service economy, investigation of employees who hold customer service roles is increasingly
important (Glomb, Kammeyer-Mueller and Rotundo, 2004). Their role is particularly crucial
since they are the workers who are in direct contact with the customers, thus they make an
immediate impact on the results of the business (Armstrong and Taylor, 2014; Brown and
West, 2005). Ensuring that staff not endangering company reputation, instead providing high
levels of customer service is essential; as it consequently increases the probability of
customer satisfaction and loyalty which in return benefits the business (Thorsten, 2004).
Nevertheless, a global research of Towers Watson (2014) found out that only four in ten
employees are highly committed, while 24% of the respondents are uncommitted, and 36%
detached from their job and the organization where they work, which points out the
importance of understanding the factors of reward systems that drive sustainable
commitment. These results might be explained by the Partial Inclusion Theory which argues
that employees belong to multiple social systems, thus only part of the individual is included
in the organisation (Katz and Kahn, 1978). It has been also discussed that part-time
employees might hold more non-work related roles, such as another job, family or studies,
than full-time employees which consequently have the potential to even more reduce their
involvement (Thorsteinson, 2003).

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Feldman (1990) emphasized that part-time employment status is especially common among
customer service roles since entire industries rely heavily on them, such as service and trade
industries in retail and hospitality sectors. The government recent statistics revealed, that
almost 27% of the UK labour force work part time, which has increased by 1.87 million in
the last four years, reaching 8.48 million (ONS, 2012 and ONS, 2016). Given the increase in
temporary and “zero-hours” employment contracts, might even more indicates the problem of
lack of motivation and commitment among this type of workforce. Therefore it provides a
perfect research context for the present study to investigate the impacts of reward systems on
customer service employees.
1.3 AIM AND OBJECTIVES
Aim
Having identified the research area and the current research gap, this study aims to
investigate the human resource management outcomes, namely motivation and
affective organizational commitment, of reward systems among customer service
employees in the UK.
Objectives
This research seeks to:
 Examine the impacts of financial and non-financial rewards on motivation and
affective organizational commitment among customer service employees.
 Identify the significant predictor variables of financial and non-financial reward
elements that influence customer service employees’ motivation and affective
organizational commitment respectively.
 Investigate the relationship between customer service employees’ motivation
and affective organizational commitment.

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1.4 CHAPTER SYNOPSIS
In order to meet the pre-set objectives of the study, the report will follow the below structure.

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Chapter 2
LITERATURE REVIEW
This chapter aims to introduce the term of reward system and its elements,
discuss the two main motivational theories and explain the wide range of
definitions of organizational commitment. It critically reviews the literature on
the impacts of financial and non-financial rewards on employee motivation as
well as on affective organizational commitment. It also includes a critical
discussion about the correlation between employees’ motivation and
organizational commitment. Consequently, this chapter leads to the development
of five hypotheses and the introduction of the research framework.
2.1 REWARD SYSTEMS
Reward system of an organization is designed to reflect its integrated policies, processes and
practices for rewarding its employees according to their contributions, competence and the
overall value they create (Armstrong, 1996). It is developed in order to support the
achievement of the business goals by attracting and retaining talented workforce, promoting
high performance, the organizational culture and its core values (Armstrong and Taylor
2014). Armstrong and Murlis (1998) also emphasized the importance of recognizing
employees as stakeholders of the business, therefore rewarding them ‘fairly, equitably and
consistently in accordance with their value to the organization’ is essential (Armstrong and
Stephens, 2005: pp 3).
The core components of reward systems are the pay and benefits which include the
employees’ basic pay, contingent pay referring to financial rewards linked to performance
and contribution; and benefits such as pension, sick and holiday pay, healthcare and other
perks, like company car (Martin, 2010). This combination of rewards is usually referred to as
financial rewards, total remuneration or transactional reward package. These rewards are
considered as extrinsic since these are provided externally, by the organization (Deci, 1972).

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On the other hand, reward management also incorporates non-financial rewards, such as the
work environment (organizational culture, supervision, non-financial recognition and
feedback), the learning and development opportunities which allows employees to expand
their competences and progress their career; and also the increased responsibility and
autonomy (Martin, 2010). Non-financial rewards can be seen as extrinsic, such as praise or
recognition; or intrinsic associated with the job design, personal interest or satisfaction and
the belief that the work is valuable (Armstrong and Taylor 2014).
Figure 2.1 Components of Reward Systems (Adopted from: Armstrong and Brown, 2006)

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2.2 MOTIVATION THEORIES
2.2.1 Maslow’s Hierarchy of Needs
Maslow (1943) claimed that basic (low level) needs of individuals must be at least partially
satisfied before higher needs can affect their behaviour. However, once a lower need has been
satisfied, people no longer consider it as a strong motivator. He stated that only unsatisfied
needs can motivate an individual. The needs have been placed in a hierarchy, as Figure 2.2
shows below, and each group of needs are dependent on a group below.
Figure 2.2 Maslow’s Hierarchy of Needs (Adopted from: Mullins, 2011)
Although, Maslow’s model have not been applied to the work environment Steers and Porter
(1991) suggested a list of organizational factors that can be connected to the original model to
motivate employees (see Table 2.1). This model provides a basis for understanding
employees’ desire not only for financial incentives but also for recognition, social status and
self-advancement.

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Levels of Needs Organizational Factors
Self-Actualization Challenging Job, Achievement, Self-advancement
Esteem Social Recognition, Job Title, Feedback
Social Friendly Supervision, Cohesive Work Group
Safety Safe Working Conditions, Company Benefits, Job Security
Physiological Pay, Pleasant Working Conditions
Table 2.1 Applying Maslow’s Hierarchy of Needs at the Workplace
(Adopted from: Mullins, 2011)
2.2.2 Herzberg’s Two-Factor Theory
Herzberg (1959) adopted and further developed Maslow’s work; however, he divided the
features of the work environment into two major groups and made distinction between
intrinsic an extrinsic work rewards. He argued that there are two distinct sets of job-related
variables that affect employee motivation; motivators (job content variables) and hygiene
variables (job context) (Reif, 1986). Hygiene factors correspond to the bottom three layers of
Maslow’s pyramid, while motivators to the top two layers.
It was proposed that hygiene factors (factors of the work environment; salary, job security,
working conditions, good quality of supervision and interpersonal relations) have to be at
present at the workplace to avoid employee dissatisfaction. However, motivators, such as
sense of achievement, personal growth and advancement, recognition and increased
responsibility; are the primary reason for enhancing motivation (Armstrong, 1996).
Not Dissatisfied but No Motivation Satisfaction and Motivation
Hygiene Factors Motivational Factors
Pleasant Working Conditions
Friendly Supervision
Salary
Fringe Benefits
Relations with co-workers
Job security
Achievement
Career Advancement
Self-Advancement
Personal Growth
Recognition
Autonomy
Table 2.2 Herzberg’s Two-Factor Theory

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2.3 IMPACTS OF REWARDS ON EMPLOYEE MOTIVATION
2.3.1 Financial/Transactional Rewards
Various articles have discussed that financial rewards have a significant influence on
employees’ motivation. Fein (1973) argued that extrinsic rewards, especially pay and
benefits, are more important factors for employee motivation than intrinsic ones, however
blue collar workers were only considered for his investigation. On the other hand, Reif’s
(1975) study with participants from all organizational levels and functional areas of six
different types of organizations (manufacturing, distributor, governmental and loan
association) have also found support for the more perceived value of monetary rewards, such
as salary, health insurance benefits and cost of living adjustments. The only intrinsic reward
that was scored high (fourth) on his survey was self-actualization, while personal growth and
development only thirteenth.
Cameron and Pierce (1994) have found that when extrinsic incentives (financial payments,
prizes, credits) were not offered the intrinsic motivation of employees were positive and
significant, but when it was offered the relationship was even stronger. Similarly to these
studies, Harel and Tzafrir (1999) stated money as ‘the most powerful motivator’. Although,
their study was based in the Middle East, their sample was extensive including participants
from different industries as well as from private and public organizations. Additionally,
recent studies of Huang, Lin and Chuang (2006) examining Taiwanese construction firm’s
employees, and Manolopoulos (2008) investigating employees from the Greek public sector
also revealed that monetary rewards are highly valued motivators for the workforce.
Likewise, employees in managerial position appeared to value salary as the most significant
indicator of motivation as well, while non-managers found to exert higher levels of
motivation when the combination of salary and fringe benefits are offered (Namasivayam,
Miao and Zhao, 2007). They suggested to greater attention to the level and the nature of the
benefits offered to workers. Similarly, Danish and Usman (2010) also found statistically
significant positive relationship between fringe benefits and employee motivation. Therefore,
these findings are in contrast to the theory of Herzberg; that employees are mainly concerned
with the features of the job itself, the higher order needs or so called ‘motivators’, and salary
and fringe benefits as hygiene factors do have motivational power.

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On the other hand, Werner and Ward (2004) concludes that, although, financial incentives
have a positive impact on work motivation, the significance of the relationship strength is
overestimated and it may reduce the intrinsic motivation of the workforce. Similarly, a
comparative study on pay systems carried out by Cox (2005) found no significant positive
impact of financial rewards on motivation; whereas, Shaw and Gupta (2015) argued that
financial incentives do not erode, in fact significantly enhance intrinsic motivation.
According to Deci (1972) financial rewards, such as competitive salary, benefits and
incentives are necessary factors for satisfying employees’ needs; however, those cannot
guarantee that workers will be motivated as well. He pointed out the importance of
administering financial rewards non-contingently, since it have the potential of keeping
higher order needs while satisfying lower ones. Whereas, contingency payment schemes (e.g.
piece rate) will most likely decrease intrinsic motivation. Nevertheless, Ahamad et al. (2015)
by conducting a research in a commercial bank in Israel found that compensation
significantly influences the motivation of employees which was measured through their
productivity and performance. Their extensive research enabled the comparison of the
impacts of financial incentives based on employees past and future performance as well and it
was argued that both type of incentive schemes, but especially future performance based, can
lead to higher motivation.
Emanating from the previous discussion the following hypothesis was developed;
H1. Financial rewards positively predict customer service employees’ motivation.
2.3.2 Non-Financial/Relational Rewards
Hackman and Oldham’s (1980) Job Enrichment Model proposed that high intrinsic
motivation is related to experiencing three psychological states at work; meaningfulness of
work, responsibility and knowledge of the outcomes; and these states are derived from certain
characteristics of a job. They argued that workers’ motivation will mostly likely positively
respond to jobs where skill variety, task identity, task significance, autonomy and feedback
are available. Since in customer service, employees’ status is relatively low, all of these non-
financial rewards have the potential to positively affect their work experience and
consequently their motivation (Malhotra, Budhwar and Prowse, 2007).

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However, examining the impacts of feedback, Deci (1972) suggested that the relationship of
feedback and intrinsic motivation is not monotonic. Too much of positive feedback may
make the employee dependent on it, thus it would decrease his intrinsic motivation. Similarly,
too much of negative feedback would most likely threaten his self-determination,
consequently reduce his intrinsic motivation. However, a very small amount of both types of
feedbacks could serve as a boost for his individual level outcomes. Similarly, Hewett and
Conway’s (2015) study concluded that verbal reward (feedback and recognition) positively
predict motivation. Although, their study included participants from the UK, the
organizations were public and their jobs mainly required professional, higher degree
qualifications which might contradict with the findings of the current study from the context
of emotional labour.
Another research, investigating white-collar workers in the U.S. found recognition and praise
from supervisor as the ‘most effective motivators’ along with personal growth and career
development, autonomy and feelings of worthwhile (Kanungo and Hartwick, 1987).
Moreover, participative management through involving employees in decision-making
appears to have motivational impacts as it satisfies intrinsic needs (Deci, 1973). It was argued
by Deci (1973) that all of these non-financial rewards derives from the workers’ personal
interests and need for challenges, which have the potential of giving the feeling of
satisfaction and accomplishment, thus increase their intrinsic motivation. Similarly Zani et al.
(2011) stated that non-financial rewards provide intrinsic value to employees, thus it is the
best way to motivate them.
According to Nohria, Groysberg and Lee (2008) employees need to bond with their
workplace to drive motivation. They argued that it can be fulfilled by providing employee
friendly working conditions and fostering good relationships among co-workers and with
supervisors. Similarly, friendly supervision style, in contrast to autocratic style, found to be
strongly and significantly correlated with employee motivation among salespeople in the
retail industry (Chowdhury, 2007). These findings support the theory of Herzberg (1959) that
managers need to provide effective, supportive and non-intrusive supervision as a basis in
order to motivate workers.

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Moreover, another element of the reward package, training, was found to be that training is
positively related to human resource outcomes, especially to motivation since it enhances
career opportunities and competences of the workforce Tharenou, Saks and Moore (2007).
Additionally, through training support can be gained from the management of the
organization, therefore it not only enables workers to enhance their skills, but also provides
an opportunity to them to bond with their superiors (Tharenou, Saks and Moore, 2007).
However, Fey et al. (2000) found that non-technical training is only marginally significant for
non-managers to increase their motivation, and technical training showed stronger positive
relationship for managers than for non-managers. These findings highlight the different
perception of training between workers and managers.
Despite to the widely argued importance of non-financial, social rewards, Rynes, Gerhart and
Minette (2004) discovered that most studies underreport the importance of monetary rewards
as a result of discrepancy of what surveyed employees tend to say and how they actually
behave. They identified money as an important motivator for employees. However, their
research focused on employee preferences at the point of recruitment which might lead to
different results compared to the phase when participants are doing the job. They also
emphasized that in contrary to Maslow’s theory, pay is not only low-order motivator to
satisfy the basic needs, but it is vital to assist in obtaining any level on the Hierarchy of
Needs Model, including social esteem and self-actualization. Nonetheless, they also
highlighted that money is not the only, and most importantly not the primary motivator for
most employees.
Therefore, the following hypothesis has been developed;
H2. Non-financial rewards positively predict customer service employees’ motivation.

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2.4 ORGANIZATIONAL COMMITMENT
Organizational commitment has been a subject of an extensively investigated research area,
therefore wide variety of definitions and measurements have been developed (Paul and
Anantharaman, 2004). The most common definition is emphasizing employees’ desire to
remain member of the organization; thus it associates organizational commitment with
workers’ loyalty to their employers (Becker, Randal, and Riegel, 1995; Meyer and Allen,
1997; Northcraft and Neale, 1996). However, other dimensions of organizational
commitment identify the integration of individual and organizational goals (Becker, Randal,
and Riegel, 1995; Cohen, 2013; Hall, Schneider and Nygren, 1970) sense of attachment to
and identification with the organization (Mowday, Steers and Porter, 1979; Porter et al.,
1974; Romzek, 1989) and willingness to exert high levels of effort on behalf of the
organization (Becker, Randal, and Riegel, 1995; Mowday, Steers and Porter, 1979;).
On the other hand, organizational commitment can be seen as a multidimensional concept as
well, which was proposed by Meyer and Allen (1997). Their three dimensional model
describes different ways in which organizational commitment develops among the workforce.
As Figure 2.3 presents, the first dimension was termed affective commitment, which identifies
the psychological attachment to and shared values with the organization; while the second
component, continuance commitment highlights the costs associated with leaving the
organization (Cohen, 2013). The final element, normative commitment, is linked with the
employees’ perceived obligation to remain with the organization (Meyer and Allen, 1997).
Since the aim of the present research is to investigate whether reward systems influence
customer service employees’ willingness to display effort on behalf of the organization and to
accept its values and goals, affective commitment was selected as the type of organizational
commitment which covers all of these criteria (Mowday et al., 1979 and Porter et al., 1974).
Figure 2.3 Three Dimensions of Organizational Commitment
(Based on Meyer and Herscovitch, 2001, Adopted from: Padma and Nair, 2009)

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2.5 IMPACTS OF REWARDS ON AFFECTIVE ORGANIZATIONAL
COMMITMENT
A significant body of literature has investigated the financial factors that influence the
organizational commitment of employees. Research carried out by Ogilvie (1986) found
significant relationship between compensation and organizational commitment. He argued
that commitment levels can only be increased if the given benefits are clearly communicated
and administered to the employees. Since transactional rewards, such as pay raises, can be
more accurately communicated than non-financial, such as job characteristics; he concluded
that financial rewards help to achieve higher levels of affective organizational commitment.
Moreover, financial rewards cannot only communicated more clearly but also the criteria in
which employees usually financially rewarded is more objective and instructions on how to
attain them is more clearly understood (Marescaux, Winne and Sels, 2013).
Similarly, a cross-national study by Farndale and Murrer (2015) found that financial rewards
are positively related to affective organizational commitment. However, their research
findings from Mexico and the U.S. showed significant relationships; in the Netherlands the
same relationship was not found evident. It may be explained by the notion that countries
with higher masculinity and/or collectivist cultures value monetary rewards and economic
security more than intrinsic rewards, such as self-actualization (Huang and Vliert, 2003).
Likewise, studies in Chinese setting (Miao et al, 2013; Newman and Sheikh, 2012a, 2012b;
and Nazir et al., 2016) found that intrinsic rewards have only limited influence on
organizational commitment whereas extrinsic rewards showed strong relatedness. Miao et al
(2013) revealed only one intrinsic reward, autonomy; with high significance level whereas
Newman and Sheikh (2012a) identified salary and fringe benefits as the main factors for
influencing commitment.
Nevertheless, a study by Angle and Perry (1983) from the context of Western organizations
revealed similar results; that extrinsic rewards, compensation in particular, enhance
organizational commitment more effectively than intrinsic ones. Although, it was argued that
intrinsic factors are important as well, they strongly rejected the view that commitment is
related to an intrinsic need fulfilment. However, it was proposed that the findings vary by
occupation and their findings might not be generalized since only US public bus operators
with respondents mainly from lover educational levels were involved in their research.

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Evaluating the adaptation of fringe benefits packages, Emerson and Prang (2016) argued that
benefits are often seen to be complex to administer for the companies as a result of meeting
tax and legal compliance, while for employees benefits are often not easy to understand.
Therefore, many companies neglect to invest in them. However, Ahmad and Scott (2015)
investigating hotel managers revealed that most types of fringe benefits have strong (such as,
sports and social facilities, relocation allowance, free laundry service and birthday
celebration) or moderate correlation (such as, staff discount, staff party and personal
accident insurance) on employees’ organizational commitment, especially to affective
commitment. Whereas, Wang (2004) research suggested that fringe benefits are normally
guaranteed at companies, therefore it does not have impact on affective commitment to share
the values and goals of the organization, but only on their continuance commitment. They
proposed that employees might be afraid of losing those benefits by leaving the organization
but those will not make them to put utmost efforts.
While these studies indicate that financial rewards are strongly and significantly related to
employees’ affective organizational commitment, Kuvaas (2006) noted that for highly
educated knowledge workers financial rewards are not the main reason for performing well
and developing high levels of commitment but the intrinsic and social rewards. Although,
Paul and Anantharaman’s (2004) research investigating software professionals in India
revealed that compensation practices show high correlation with affective organizational
commitment, significant relationship was not found in the regression analysis. Consequently,
salary might be a crucial criterion in the choice of the organization but once knowledge
workers are part of the organization non-monetary rewards are more important to them. In
support to this, Chew and Chan (2008) recognized that pay alone is not sufficient for
increasing employees’ organizational commitment, but along with non-financial rewards it
can provide a more effective approach.
However, the aim of the current research is to investigate customer service employees’
perception of organizational rewards, hence studies in the context of knowledge workers
might limit the understanding of the behaviours of the target population. Therefore based on
the literature from outside of the knowledge workers context, the following hypothesis was
developed;
H3. Financial rewards positively predict affective organizational commitment among
customer service employees.

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2.5.2 Non-financial/Relational Rewards
Previous studies in the context of non-financial rewards and organizational commitment
identified training (Benson, 2006; Nazir et al., 2016 and Paul and Anantharaman, 2004),
supervisor support (Kuvaas and Dysvik, 2010 and Truss et al., 2006), recognition and
feedback (Chew and Chan, 2008; Kinnie et al., 2005; Paul and Anantharaman, 2004 and
Truss et al., 2006), career development (Malhotra, Budhwar and Prowse, 2007; Meyer and
Smith, 2000; Paul and Anantharaman, 2004 and Truss et al, 2006) and the nature of the
task, such as autonomy, (Chew and Chan, 2008; Malhotra, Budhwar and Prowse, 2007 and
Mottaz, 1988) as the main factors influencing employees attitudes towards the organization
they work for.
A research study conducted by Paul and Anantharaman (2004) with a sample of knowledge
workers proposed that all non-financial rewards play a significant role in determining
employees’ organizational commitment. Particularly, employee-friendly work environment,
career development, development-oriented appraisal and comprehensive training were scored
highest, in the regression analysis. Although this study included various elements of non-
financial rewards, cross-sectional nature of the study with respondents from the Far East
might limit the generalizability of the results.
On the other hand, Malhotra, Budhwar and Prowse (2007) by investigating front line
employees in the UK call centres interpreted that non-financial rewards are considered as
more important to employees than financial ones. Similarly to Paul and Anantharaman (2004)
they have identified career development as a significant factor. In addition to this, autonomy,
participation in decision-making and role clarity found to enhance employees emotional
attachment to the organization. They argued, that in customer service roles, workers status is
relatively low, therefore autonomy and opportunities given to them to participate in decision
making regarding their role can make them more involved with the vison of the organization
(Malhotra, Budhwar and Prowse, 2007). However, training and feedback was not found
significant in their research.

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Similary, Kinnie et al. (2005) conducting research in the UK by selecting participants only
from organizations where quality of HRM practices operates, known as they were listed on
Sunday Times 100, training was not found significant by them either. However, in contrast to
Malhotra, Budhwar and Prowse (2007) career opportunities and involvement were not
supported either, whereas, recognition, communication and openness were found to influence
organizational commitment. The reason for the contradictory results can be that Kinnie et al.
(2005) included different levels of employees, from professionals, line managers and workers
while Malhotra, Budhwar and Prowse (2007) only considered workers for their investigation.
Although, findings from Chinese setting contradicts previous research that non-monetary
factors are the main influence on affective organizational commitment (Miao et al, 2013;
Newman and Sheikh 2012a and 2012b), Nazir et al., (2016) argued that autonomy leads to
empowerment and more flexible decision-making about employees’ work; therefore it foster
commitment. Similarly, Mottaz (1988) highlighted that intrinsic rewards followed by social
rewards make the most positive impact on affective organizational commitment, particularly
the nature of the task, task autonomy, significance and involvement, were identified as the
primary antecedents of organizational commitment.
Furthermore, Nazir et al., (2016) also found a significant positive relationship between
training and organizational commitment. They observed that as a result of training, workers
feel more confident and satisfied in their work, consequently they become more committed.
However, Benson (2006) argued that the effectiveness of employee development depends on
the activity and the skills that can be gained. Employees who gained specific skills through
on the job training were more committed while general, marketable skills reduced their
organizational commitment. Similarly, Chew and Chan (2008) stated that employees not
necessarily increase their commitment as a result of receiving training. However, the
examined companies in their research might lacked of time, resources and training facilities,
thus the received training content might could not serve the workers’ need. In addition to this,
Marescaux, Winne and Sels (2013) suggested that receiving training may not be seen as a
reward or appreciation but a sign of incompetence, therefore it lower the organizational
commitment.

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In contrast, perceived supervisor support and the behaviour of immediate line-manager is
more strongly related to affective commitment than employee development (Kuvaas and
Dysvik, 2010; and Truss et al., 2006). Furthermore, performance appraisals that provide
regular feedback to workers along with recognition practices nurtures the sense of attachment
and belonging of the rewarded employee (Chew and Chan, 2008; Gagné, 2009 and Paul and
Anantharaman, 2004) as well as provide an opportunity to communicate the organization’s
vision and goals (Cabrera and Cabrera, 2005).
The above findings of previous literature suggest the following hypothesis;
H4. Non-financial rewards positively predict affective organizational commitment
among customer service employees.

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2.6 RELATIONSHIP BETWEEN EMPLOYEES’ MOTIVATION AND THEIR
AFFECTIVE ORGANIZATIONAL COMMITMENT
According to Rizal et al. (2014) motivated employees ‘will give a boost involvement in
various activities to achieve organizational commitment’. Significant results have been
revealed in their study and it was concluded that individuals’ motivation is strongly related to
organizational commitment, particularly to workers’ willingness to share the organizational
values and to help the business to achieve its goals. In similar vein, findings of Choong,
Wong and Lau (2011) show significant correlation between motivation and all the
components of organizational commitment (affective, normative and continuance), however,
the relationship between affective commitment and motivation, which is in context with
present research, revealed the strongest correlation. Despite the fact that Warsi, Fatima and
Sahibzada (2009) by investigating private sector employees of Pakistan, found that the link
between job satisfaction and organizational commitment is stronger than motivation and
organizational commitment the correlation of motivation and organizational commitment
showed significant positive results.
In contrast, Tella, Ayeni and Popoola (2007) found motivation to be negatively correlated to
organizational commitment by investigating library personnel in Nigeria. The controversial
result suggests the need for examining the relationship in specific research context as well.
As this research aims to investigate customer service employees working in the UK the
results might differ from the previously mentioned study. Furthermore, motivation was not
found to be strongly important for college student volunteers’ organizational commitment
(Nazilah, Rozmi and Fauziah, 2012). However, it might be explained by the notion that
volunteers differ from paid employees, thus they can be highly motivated to perform a task
without strongly committed to the organization.
Therefore, hypothesis can be stated as follows:
H5. Customer service employees’ motivation is positively related to their affective
organizational commitment.

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2.7 CONCEPTUAL RESEARCH FRAMEWORK
Employees’ motivation was discussed as workers’ intention to put extra efforts to complete
the given tasks to them and fulfill their best potentials (Armstrong and Taylor, 2014), while
the level of their organizational commitment determines workers’ willingness to share the
values and goals of the organization and to contribute to the success of the business
(Mowday, Porter and Steer, 1982). Both of these variables are seen as key factors in
achieving competitive advantage in today’s highly competitive business environment
(Towers Watson, 2012). It has been identified that both employee motivation and
organizational commitment are dependent on the organizations’ reward packages, namely
financial and non-financial rewards (Fay and Thompson, 2001). Moreover, it has been
identified that there is correlation between motivation and organizational commitment
(Choong, Wong and Lau, 2011; Rizal et al., 2014 and Tella, Ayeni and Popoole, 2007).
Therefore, the proposed research framework can be seen below.
Figure 2.4 Research Framework
2.8 CHAPTER SUMMARY
This chapter has defined the term of reward systems along with its elements, introduced
motivational theories of Maslow and Herzberg, and explained the concept of organizational
commitment. It critically reviewed the existing literature on the effects of financial and non-
financial rewards on employee motivation as well as on organizational commitment. The
correlation between employees’ motivation and organizational commitment has been
discussed. Consequently, five hypotheses have been developed along with the research
framework.

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Chapter 3
RESEARCH METHODOLOGY
This chapter aims to critically explain the available research strategies along with
the justification of why the adopted method serves the aim of the research to
investigate the impacts of reward systems on customer service employees’
motivation and affective organizational commitment. It provides the scales and
measurements used for this research as well as the sampling, data collection and
data analysis methods. Finally, limitations of the research as well as the ethical
issues that have been considered were addressed.
3.1 RESEARCH PHILOSOPHY
First of all, the research philosophy provides a crucial starting point for business research
since it not only influences what method is chosen but also how the data is collected,
analysed and understood. According to Saunders, Lewis and Thornhill (2016) two main
philosophies can be distinguished; positivism and interpretivism. Positivism entails observing
social reality and creating law-like generalisations by testing existing theory to explain and
predict behaviour in organizations (Gill and Johnson, 2010).
Although interpretivist research facilitates the new and in-depth understandings of a research
problem (Saunders, Lewis and Thornhill, 2016); as a result of its complexity and the close
involvement with the people being investigated it is a highly subjective approach (Bryman
and Bell, 2011). Therefore, in order to avoid influencing the findings, the present study is
based on the philosophy of positivism, since investigating the relationships of rewards and
employee motivation and organizational commitment requires objectivity and a detached data
collection about an observable reality (Crotty, 1998). Hence, existing theories will be tested
as well as regularities and casual relationships will be identified.

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3.2 RESEARCH APPROACH
3.2.1 Deductive or Inductive
Alongside with the positivist philosophy deductive research approach has been implemented
since first a theoretical framework and hypotheses were developed from the academic
literature and then it was tested by empirical observation (Collis and Hussey, 2014). Hence,
the logic moved from the general to the particular to investigate the impacts of reward
systems on customer service employees’ attitudes. Whereas inductive approach does not aim
to approve or negate the existing theories, but pursue to create new outlines and significances
in a more subjective, qualitative way (Collis and Hussey, 2014).
3.2.2 Quantitative or Qualitative
According to Saunders, Lewis and Thornhill (2016) quantitative and qualitative research
techniques can be seen as two ends of a continuum. Quantitative method examines
relationships between variables by theory testing, and it uses and generates numerical data
through a standardised data collection technique, such as questionnaires (Saunders, Lewis
and Thornhill, 2016). Despite the fact, the qualitative method enables the investigation of
reasons behind a phenomenon and exploration of new areas of the research problem,
quantitative method can better determine and quantify the degree of relationships between
concepts and variables and enables highly structured empirical investigation and statistical
analysis (Blumberg, Cooper and Schindler, 2011). Moreover, quantitative data collection is
perceived as more anonymous and more objective as there is no influence from the researcher
side (Saunders, Lewis and Thornhill, 2016), which is highly important to investigate sensitive
topics such as rewards and employees’ behaviours towards their jobs and organizations;
therefore quantitative approach is the most suitable for the present study.
3.3 RESEARCH METHOD
3.3.1 Primary and Secondary Data
In order to meet the pre-set objectives of the study, both secondary and primary data was
used. Secondary data was obtained from academic journals and textbooks in order to identify
the gap in the existing literature and develop hypotheses. Since secondary data is ‘gathered
and recorded by someone else prior to the current need of the researcher’s (Zikmund, 2002,
pp.136) it cannot provide the most relevant and up to date data (Bryman and Bell, 2011).
Therefore, primary data was collected by using a self-administered questionnaire.

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3.3.2 Questionnaire
As it has been discussed, survey method was designed to gather primary data for the research
since it has the potential to reveal attitudes and expectations of a representative sample of
individuals (Zikmund, 2002). Self-administered questionnaires cannot only be distributed
faster and cheaper, but also a larger sample size can be reached, thus it can provide more
accurate information about the population than qualitative methods, such as observation and
interviews (Cooper and Schindler, 2011). However, the lack of presence of the researcher at
the time of the data collection prevents the respondents to get clarification from the
researcher if misunderstandings occur (Bryman and Bell, 2007). In order to reduce the
occurrence of that problem to the lowest level, a pilot study was conducted beforehand (see
Section 3.5).
The survey was designed with closed-ended questions and respondents were asked to state
their level of agreement on a five-point Likert Scale (see Appendix A). The reason for
choosing such types of questions was to enhance the comparability of answers since it makes
easier for the researcher to quantify and show relationships between variables (Bryman and
Bell, 2011). Moreover, in this way higher response rates can be achieved as questions can be
answered quicker and more easily by participants (Zikmund, 2002).
3.4 MEASUREMENTS
Measurements used in the present study were already developed and published in high-
quality ABS (3 and 4 stars) listed journals in order to ensure reliability and validity of the
scales. Furthermore, the adopted scales have been tested for their reliability by employing
Cronbach’s alpha. Results were acceptable and all values were positive thus it indicates that
items were measuring the same underlying characteristics (Pallant, 2010).
All items on the questionnaire were linked to a five-point Likert scale ranking, where 5 meant
‘strongly agree’ and 1 ‘strongly disagree’. Since this type of scale does not force participants
to indicate simple ‘yes or no’ answer, a better understanding of the level of their agreement
can be reached (Zikmund et al., 2013). Moreover, it allows neutral and undecided feelings to
be presented (Zikmund et al., 2013). In addition to this, reversed items were included on the
research survey in order to diminish the risk of biases (Cooil and Rust, 1994).

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3.4.1 Independent Variables
Since the present research aims to investigate the impacts of reward systems on employees’
behaviours towards their jobs and the organizations they work for, financial and non-financial
rewards are the independent variables in the study. Towers Perrin model, shown in Figure
3.1, was adopted in order to identify pay and benefits as financial (transactional) elements of
the reward system; as well as work environment and learning and development as non-
financial, or so called relational rewards.
Figure 3.1 Towers Perrin Model (Adopted from Armstrong and Taylor, 2014 pp 366)
Financial/Transactional Rewards
Financial rewards were measured by two indicators; pay and fringe benefits, developed by
Malhotra, Budhwar and Prowse (2007) and have been well accepted for demonstrating high
reliability and validity (Newman and Sheikh, 2012b). In the current study, Cronbach alpha
coefficient was .812. The responses for each indicator (pay and benefits) were summed and
averaged to yield a satisfaction with the financial benefits. Items included are listed in Table
3.1.
Pay I amsatisfied with the amount of pay I receive for the job I do.
I feel I ampaid fairly considering the work I do.
I amsatisfied with my pay considering otherorganizations I know of.
Benefits I amsatisfied with the fringe benefits package.
The fringe benefits package is as good asother organization offer.
Table 3.1 Scales of Financial Rewards

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Non-Financial/Relational Rewards
Based on the Towers Perrin Model two main indicators were identified; learning and
development and work environment, and several sub-scales were selected and adopted from
Malhotra, Budhwar and Prowse (2007), see Table 3.2. Promotional opportunities was
captured by a reduced scale of Mottaz (1988) while training was measured by a two-item
scale, originally generated by Boshoff and Allen (2000). Scales to measure supervision was
used by Singh (1998) and Teas (1983) while reduced scale of autonomy was adopted from
the Job diagnostic survey developed by Hackman and Oldham (1976). Finally, three-item
scale was taken from Hackman and Oldham (1976) to measure satisfaction with feedback.
The developed scale has good internal consistency, with a Cronbach alpha coefficient of .902.
Similarly to the financial rewards, the responses for each item were summed and averaged to
yield a satisfaction with the non-financial benefits. The items included on the survey are
listed in Table 3.2.
Learning and
Development
Promotional opportunities
There is enough opportunity foradvancement on my job.
Training
I receive induction training before coming in contact with
customers.
I receive regular training to keep me updated for good service.
Work Environment Working condition
The working conditions are adequate to performa good job.
Supervision
My supervisoris approachable.
My supervisorhelps make my job more pleasant.
Autonomy
The job allowsme to use personal initiative in carrying out the
work.
Feedback (non-financial recognition)
Superiorgives me feedback on how well I amperforming on my
job.
I ampraised by my superior for providing good service to
customers.
I receive recognition by superior for providing good service.
Table 3.2 Scales of Non-Financial Rewards

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3.4.2 Dependent Variables
Since the current study investigates the influence of rewards systems on human resource
management outcomes, employee motivation and affective organizational commitment are
the dependent variables in this study.
Employee Motivation
Employee motivation was measured by job satisfaction since it has been identified and used
as a motivational factor for employees (Mak and Sockel, 2001). The scale was accepted
since it was tested for reliability and validity checks have been performed by conducting
confirmatory factor analysis (CFA) (Mak and Sockel, 2001). In the current study, Cronbach
alpha coefficient was .627 which is a bit low, however, as it only consists of four items the
result (>0.5) is acceptable (Pallant, 2010). Items included are presented in Table 3.3.
Items
1. All in all, I am satisfied with my job.
2. In general, I like working here.
3.
I will probably not be looking for a job outside of
customer service.
4. I seldom think about quitting. (R)
Table 3.3 Scale of Employee Motivation
Affective Organizational Commitment
It was measured using a reduced 7-item organizational commitment questionnaire (OCQ)
scale developed by Mowday et al. (1979) which fit well with the purpose of the present study
since it only measures affective commitment, in contrast to the other highly cited scale of
Allen and Meyer (1990). Moreover, OCQ of Mowday et al. (1979) was preferred for its
strong consistency and coherence as it is designed to be unidimensional in nature (Reichers,
1985). Since there is substantial evidence regarding the reliability and validity of this measure
(Mowday et al., 1979) it has been widely used in academia (Angle and Perry, 1981; Paul and
Anantharaman, 2004; Whitener, 2001). In the current study, the Cronbach alpha coefficient
was .864. Table 3.4 exhibits the revised items of OCQ developed by Mowday et al. (1979).

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Items
1. I am willing to put in a great deal of effort beyond that normally
expected in order to help this organization be successful.
2. I talk up this organization to my friends as a great organization to
work for.
3. I feel very little loyalty to this organization. (R)
4. I find that my values and the organization’s values are very similar.
5. There’s not too much to be gained by sticking with this organization
indefinitely. (R)
6. I really care about the fate of this organization.
7. Deciding to work for this organization was a definite mistake on my
part. (R)
Table 3.4 Scale of Affective Organizational Commitment
3.4.3 Control Variables
Previous studies suggest that comparing the attitudes of part- and full-time employees is
particularly crucial in service and trade industries, in retail and hospitality sectors (Feldman,
1990 and Rotchford and Roberts, 1982). There are studies indicating differences between
part- and full-time employees’ attitudes (Clinebell and Clinebell, 2007; Lee and Johnson
(1991); Jacobsen (2000); Rotchford and Roberts, 1982; Stamper and Van Dyne, 2003 and
Thorsteinson, 2003). They argue that full-time employees are more involved with their work
and workplace as a result of the more working hours, consequently they are more motivated.
Moreover, researchers (Marescaux, De Winne and Sels, 2013 and Meyer and Allan, 1997)
have found a correlation between age and affective commitment. It was assumed that age can
be associated with seniority which provides an option for higher position within the same
organization. Therefore, age and employment status were added as control variables.
3.5 SAMPLE SELECTION AND DATA COLLECTION
Selecting a segment of the population for investigation a convenience non-probability
approach, called snowball sampling method (Saunders, Lewis and Thornhill, 2016) has been
applied to the present research as a result of budget and time constraints. Several individuals
were approached from the relevant population, who were identified as holding a customer
service position, and they were asked to complete and forward the questionnaire to
individuals from the same population and even those respondents identified further cases. By

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doing so, this method proved to be efficient technique to gather large number of responses in
short period of time; however, a possible limitation of this sampling can be the homogeneity
of the sample which restricts the generalization of the findings across the wider population
(Wilson, 2010). In order to reduce the probability of bias, potential respondents were
approached from different age groups, employment status, organization and geographical
locations (UK wide).
The questionnaire was carried out on a sample size of 145, with respondents who were aged
18 or above, currently holding a customer service role and based in the UK. The sample size
enables fair representation of the control variable (occupation status) and gathers sufficient
data from the population. Therefore, the results of the data analysis would be significant.
3.6 PILOT STUDY
In order to ensure that the survey questions operate well and can be easily and clearly
understood (Bryman and Bell, 2011) a test was conducted before distributing it to potential
respondents. Feedback was asked from the supervisor about the clarity of scales and the items
on the questionnaire. Moreover, the design and the flow of the questions along with the
grammar and spelling mistakes were also checked by asking two potential participants from
each employment status to complete and make comments on the survey. The participants’
feedback on the layout and the order of the sections were considered and minor changes were
made on the final version. Moreover, the time it took for them to fill it out was summed and
averaged in order to be able to provide information on the length of survey to respondents.
3.7 DATA ANALYSIS
For this study, the statistics software SPSS was used in order analyse the collected data since
it allows the quick and accurate generation of various graphs and statistical tests. Descriptive
statistics were used to summarize the numerical details and determine consistent patterns,
while inferential statistics were adopted to test the hypotheses and carry out multiple linear
regression analysis between dependent and independent variables (Wilson, 2010).
3.8 LIMITATIONS
The chosen research method is suitable for addressing the purpose of the study to investigate
the impacts of reward systems on employees’ motivation and organizational commitment;
however, it cannot provide deeper understanding and further insight into the reasons behind
participants’ behaviours. Qualitative research approach with in-depth interviews or

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observations could have been served the researcher to gather more information about the
reasons behind employees’ attitudes towards their jobs and organizations. Furthermore, as a
result of time constraints a relatively smaller sample size was achieved by convenience and
snowball sampling which might limit the generalizability of the results to the whole
population. More accurate findings may have been obtained by either extending the sample
size or specifying the type of customer service positions, such as retail, supermarkets or
hospitality sectors; for investigation. Moreover, since the research is UK based it limits the
understanding of customer service employees’ attitudes in a Western European context.
3.9 ETHICAL CONSIDERATIONS
In order to adhere to the Brunel University Code of Research Ethics several ethical issues
were taken into account. First of all, before the data collection procedure ethical review and
approval was obtained from the Brunel University Research Ethics Committee.
Secondly, a well-detailed Participation Information Sheet (see Appendix A) was displayed at
the beginning of the online survey providing clear information about the nature and the
purpose of the study. Moreover, it was highlighted that participation is completely voluntary
and the right to withdraw it at any time was made clear. Furthermore, anonymity,
confidentiality and privacy was ensured by avoiding questions requiring personal information
and ensuring that the collected data is kept securely, on a password protected Brunel
University server, and only used in an aggregated form in the project report.
Finally, contact details of the researcher was provided in order to enable participants to raise
any questions regarding the research project, while the contact details of the supervisor and
the Chair of the Research Ethics Committee were stated to allow respondents to make any
complaints.
3.10 CHAPTER SUMMARY
This chapter outlines the overall methodology of the present study that was adopted in order
to address the aim and to meet the pre-set objectives of the research. The chosen research
philosophy, approach and method were critically reviewed along with the justification of why
those were used for the current study. Scales for measuring dependent and independent
variables as well as the control variables were introduced. Moreover, sampling technique,
data analysis and limitations of the study were discussed and steps taken to ensure the
research complies with the University Code of Research Ethics were explained.

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Chapter 4
FINDINGS AND ANALYSIS
This chapter presents the results of the analysis based on the data that were
collected through the conducted questionnaire. The first section illustrates the
descriptive statistics, the demographic profile of respondents. It was followed by a
section explaining the reasons, why multiple linear regression analysis was
adopted to examine the strength of relationship between the reward package
constructs and customer service employees’ motivation and affective
organizational commitment. After that, the results of the examined relationships
between dependent, independent and control variables were presented.
4.1 DEMOGRAPHIC PROFILE OF RESPONDENTS
A total number of 145 questionnaires were used for this analysis. Out of the 145 respondents,
71 (49%) were male and 74 (51%) were female (see Figure 4.1). The majority of the
participants, 72 (49.66%) belonged to the age group of 18-24, and 44 (30.3%) to the 25-34
while responses from older age groups were limited (see Figure 4.2). As Table 4.1 highlights,
responses based on the control variable of occupation status were gathered closely equally in
order to obtain fair representation of both part-time 76 (52.4%) and full-time 69 (47.6%)
employees.
Figure 4.1 Age of Respondents Figure 4.2 Gender of Respondents
Employment Status
Frequency Percent Valid Percent Cumulativ e Percent
Valid
Part-time 76 52,4 52,4 52,4
Full-time 69 47,6 47,6 100,0
Total 145 100,0 100,0
Table 4.1 Employment Status of Responses

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4.2 MULTIPLE LINEAR REGRESSION ANALYSIS
A multiple linear regression (MLR) analysis was adopted throughout this chapter to meet the
pre-set objectives of the study. This analysis type was selected since non-violation of
assumptions, discussed by Pallant (2010) was found. First of all, correlation among the
variables was checked. Strong correlation was found between motivation and non-financial
rewards, organizational commitment and non-financial rewards; moderate between
motivation and financial rewards, motivation and organizational commitment; and small
between financial and non-financial rewards, and financial rewards and organizational
commitment (See Table 4.2). Regarding the control variables, age and motivation showed
weak relatedness, while employment status and motivation and organizational commitment
were moderate.
Descriptive Statistics (N=145)
Variable Mean SD 1 2 3 4 5 6
1. Financial Rewards 3.1117 .86727 -
2. Non-financial Rewards 3.4807 .90870 .252** -
3. Motivation 3.1207 .79391 .402** .543** -
4. Organizational
Commitment
3.2414 .84205 .145 .793** .487** -
5. Age 0.76 0.900 -.118 -.107 .048* 0.030 -
6. Employment Status 0.48 0.501 -.165* -.174* .234** .173* .441** -
**Correlationis significant at the 0.01level (2-tailed).
*Correlationis significant at the 0.05level (2-tailed).
Table 4.2 Intercorrelations among Variables
Secondly, the sample size of 145 was accepted since a calculation using a formula of
Tabachnick and Fidell (2007) gave 68 responses as the minimum requirement. Moreover,
multicollinearity (VIF=1.068 and Tolerance=0.937) was checked to avoid high correlation
between the independent variables. Multicollinearity was rejected as the results are less than
10 and more than 0.10 respectively, the benchmark values to be compared against (Pallant,
2010).
In addition to these, normality and linearity was tested for motivation and organizational
commitment (see Figure 4.3) and no major deviations were detected. Residuals closely
followed the diagonals which is the requirement of the normal distribution (Pallant, 2010).
Alongside with these, the independences of residuals are presented on Figure 4.4. Therefore,
the results of this investigation supported the use of MLR as an appropriate statistical analysis
for this part of the study.

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Figure 4.3 Normal Probability Plots of the Regression Standardized Residuals
Figure 4.4 Scatterplot of Regression Standardized Residuals
In order to determine the statistical significance of the results, which consequently enables
the acceptance or rejection of the developed hypotheses, 5% significance level was chosen.
This significance level is well accepted in academia and business research, therefore it was
deemed to be appropriate for this investigation (Bryman and Bell, 2011).
Due to the multiple types of rewards, composite variables were developed to compute the
mean of financial and non-financial reward elements. These variables were adopted on the
integrated model, while on the disintegrated model the mean of each financial and non-
financial indicator were separately computed.

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The proportion of explained variance, as measured by the R square, for the regression
analysis is 0.415 as it shown on Table 4.3. In other words, financial and non-financial
rewards are explaining 41.5% of variance in employee motivation. Consequently, it means
that high proportion, about 58.5%, of employee motivation is explained by other variables.
Model Summary
Model R R Square Adjusted R Square Std. Error of the
Estimate
1 ,644a
,415 ,398 ,61588
a. Predictors: (Constant), Age, Non-f inancial Rewards, Financial Rewards, Occupation
Table 4.3 Model Summary of MLR on Employee Motivation
The ANOVA model test in Table 4.4 support the existence of relationship between financial
and non-financial rewards and employee motivation, since the significance value (p) is 0.000
which is less than 0.05, the benchmark value to be compared against (Bryman and Bell,
2011).
ANOVAa
Model Sum of Squares df Mean Square F Sig.
1
Regression 37,659 4 9,415 24,820 ,000b
Residual 53,104 140 ,379
Total 90,763 144
a. Dependent Variable: Motiv ation
b. Predictors: (Constant), Age, Non-f inancial Rewards, Financial Rewards, Occupation
Table 4.4 ANOVA of MLR on Employee Motivation

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The regression coefficients table (Table 4.5) highlights that both independent variables,
financial and non-financial rewards have a statistically significant impact (p=0.000) on
employee motivation. Beta value shows that out of these variables, non-financial rewards
make the largest unique contribution to employee motivation (b=0.431), while financial
rewards make contribution of 0.331.
Control variables of employee motivation revealed that employment status have a significant
impact on the dependent variable (p=0.012) with a beta value of 0.192. On the other hand,
age did not show significant effect on it.
Coefficientsa
Model Unstandardized Coef f icients Standardized
Coef f icients
t Sig.
B Std. Error Beta
1
(Constant) ,645 ,282 2,287 ,024
Financial Rewards ,303 ,063 ,331 4,839 ,000
Non-f inancial Rewards ,377 ,061 ,431 6,162 ,000
Employ ment Status ,304 ,120 ,192 2,531 ,012
Age ,043 ,065 ,049 ,663 ,508
a. Dependent Variable: Motiv ation
Table 4.5 Regression Coefficients – MLR on Employee Motivation

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4.3.1 Evaluation of the Reward Package Elements on Employee Motivation
As another objective of the present study, the primary research also aimed to identify the
elements of the reward package, both financial and non-financial, which indicate high
employee motivation. Before conducting a multiple linear regression analysis with the
multiple indicators of financial and non-financial rewards multicollinearity was checked (see
Appendix B) and rejected, thus the analysis could be carried out. The results of the multiple
linear regression analysis are presented on Table 4.6.
As it can be seen on Table 4.6 both indicators of financial rewards show significant
relationships with employee motivation. Although, pay was found to exert a significant
impact on customer service employees’ motivation (p=0.020) with beta value of 0.197 and t
value of 2.355, it is less influential compared to fringe benefits (p=0.001, b=0.292, t=3.495)
Analysing, the non-financial elements of the reward package, working condition was found to
make the most unique contribution to employee motivation (p=0.000, b=0.423, t=5.372).
Moreover, friendly supervision was scored the second most important factor (p=0.005,
b=0.328, t=2.847) followed by career development opportunities (p=0.33, b=0.162, t=2.157).
Although, training appears to have significant impact on employee motivation (p=0.021, b= -
0.186, t= -2.338), it indicates a negative relationship. Whilst, autonomy (p=0.969), feedback
(p=0.765) and recognition (p=0.507) do not show significant results.
Independent Variables beta t R2 p
Financial Rewards 0.170 0.000*
Pay 0.197 2.355 0.020*
Fringe Benefits 0.292 3.495 0.001*
Non-financial Rewards 0.440 0.000*
Working Condition 0.423 5.372 0.000*
Supervisor 0.328 2.847 0.005*
Career Development 0.161 2.157 0.033*
Training -0.186 -2.338 0.021*
Recognition 0.081 0.666 0.507
Feedback -0.034 -0.300 0.765
Autonomy -0.004 -0.039 0.969
Dependent Variable: Employee Motivation
*p < 0.05
Table 4.6 Disintegrated Model –Reward Package Elements on Employee Motivation

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COMMITMENT
The proportion of explained variance, as measured by the R square presented on Table 4.7 for
the rewards impact on customer service employees’ affective organizational commitment is
0.645. It can be argued that approximately 64.5% of the variation in commitment is explained
by rewards. This result is substantially higher than the 41.5% of variance in employee
motivation (Table 4.3). Therefore, it can be deduced that rewards have more significant
impact on employees’ affective organizational commitment than on their motivation.
Model Summary
Estimate
1 ,803a
,645 ,635 ,50877
a. Predictors: (Constant), Age, Non-f inancial Rewards, Financial Rewards, Occupation
Table 4.7 Model Summary of MLR on Affective Organizational Commitment
In addition to this, the existence of the relationship between rewards and affective
organizational commitment is supported by the ANOVA model in Table 4.8 as well, which
provides the significance value (p) of 0.000.
ANOVAa
1
Regression 65,864 4 16,466 63,613 ,000b
Residual 36,239 140 ,259
Total 102,103 144
a. Dependent Variable: Organizational Commitment
b. Predictors: (Constant), Age, Non-f inancial Rewards, Financial Rewards, Occupation
Table 4.8 ANOVA of MLR on Affective Organizational Commitment

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However, when examining financial and non-financial rewards’ impact on organizational
commitment the significance levels show controversial results. The regression coefficients
Table 4.9 do not show statistically significant results for financial rewards (p=0.315) with
negative - 0.054 contribution to organizational commitment. Whereas, non-financial rewards
highly contribute (b=0.827) to organizational commitment with a significant (p=0.000) value.
Interpreting the impacts of the control variables on organizational commitment, employment
status was not found to influence the dependent variable. On the other hand, age revealed
small relatedness with a beta value of 0.129 at a significance level of 0.027.
Coefficientsa
Coef f icients
t Sig.
B Std. Error Beta
1
(Constant) ,556 ,233 2,386 ,018
Financial Rewards -,052 ,052 -,054 -1,008 ,315
Non-f inancial Rewards ,766 ,051 ,827 15,159 ,000
Employ ment Status -,062 ,099 -,037 -,629 ,531
Age ,120 ,054 ,129 2,242 ,027
Table 4.9 Regression Coefficients – MLR on Affective Organizational Commitment

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4.4.1 Evaluation of the Reward Package Elements on Affective Organizational
Commitment
Similarly, to section 4.3.1, multiple linear regression analysis was carried out to investigate
the different elements of the reward package, both financial and non-financial since
multicollinearity between the variables was rejected. Although, financial rewards were not
found to be significant in affecting customer service employees’ affective commitment,
fringe benefits separately have a positive significant impact (p=0.000, b=0.337, t=3.859).
Whereas, pay do not show significance (p=0.131) in fact indicates negative relationship.
On considering only non-financial elements of the reward package (see Table 4.10)
recognition appeared to be the strongest indicator in predicting affective commitment
(p=0.001, b=0.343, t=3.488). It was followed by friendly supervision (p=0.009, b=0.244,
t=2.636) and autonomy (p=0.043, b=0.146, t=2.046). Whereas, career development
opportunities (p=0.082), training (p=0.254) and feedback (p=0.409) were not found to exert
significant influence on the dependent variable.
Independent Variables beta t R2 p
Financial Rewards 0.095 0.001*
Pay -0.123 -1.517 0.131
Fringe Benefits 0.337 3.859 0.000*
Non-financial Rewards 0.638 0.000*
Recognition 0.343 3.488 0.001*
Supervisor 0.244 2.636 0.009*
Autonomy 0.146 2.046 0.043*
Career Development 0.105 1.752 0.082
Training 0.073 1.144 0.254
Feedback 0.072 0.828 0.409
Dependent Variable: Organizational Commitment
*p < 0.05
Table 4.10 Disintegrated Model –Reward Package Elements on Affective Organizational
Commitment

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4.5 RELATIONSHIP BETWEEN EMPLOYEES’ MOTIVATION AND THEIR
AFFECTIVE ORGANIZATIONAL COMMITMENT
The R square value of examining customer service employees’ motivation on affective
organizational commitment is 0.238 as it can be seen on Table 4.11 Consequently, it suggests
that low proportion, approximately 24% of organizational commitment is explained by
employee motivation. However, the relationship is still appears to be significant, with a p-
value of 0.000, as Table 4.12 presents.
Model Summary
Estimate
1 ,487a
,238 ,232 ,73783
a. Predictors: (Constant), Motiv ation
Table 4.11 Model Summary of MLR on Employee Motivation and Affective Organizational
Commitment
ANOVAa
1
Regression 24,254 1 24,254 44,552 ,000b
Residual 77,849 143 ,544
Total 102,103 144
b. Predictors: (Constant), Motiv ation
Table 4.12 ANOVA of MLR on Employee Motivation and Affective Organizational
Commitment
On examining Table 4.13 Regression coefficients of employees’ motivation show positive
significant results. The beta value of 0.487 indicates that customer service employees’
motivation make a large unique contribution to their organizational commitment with a t
value of 6.675.
Coefficientsa
Coef f icients
t Sig.
B Std. Error Beta
1
(Constant) 1,628 ,249 6,530 ,000
Motiv ation ,517 ,077 ,487 6,675 ,000
Table 4.13 Regression Coefficients – MLR on Employee Motivation and Affective
Organizational Commitment

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4.6 CHAPTER SUMMARY
Conducting multiple linear regression analysis, the existence of rewards’ influence on
employee motivation and affective organizational commitment, as well as employee
motivation on affective organizational commitment was found. The results of the significance
levels, beta, t, R2 values were presented. The research findings along with the hypothesis tests
will be critically discussed in relation to the prior literature in the following chapter.

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Chapter 5
DISCUSSION
This chapter is divided into three main sections to address the objectives of the
present research. Impacts of rewards on employee motivation and affective
organizational commitment respectively, along with the evaluation of the reward
package elements and the influence of the control variables (age and employment
status) has been critically discussed in relation to the literature review. Moreover,
the relationship between customer service employees’ motivation and affective
organizational commitment has been addressed.
Examining the impacts of financial rewards on employee motivation, a statistically
significant, positive relationship was found (p=0.000, t=4.839, b=0.331) which consequently
leads to the acceptance of hypothesis 1. This finding of the study reinforces Maslow’s theory
(1943) that if workers receive financial incentives it will increase their motivation levels. The
results are also consistent with previous studies of Ahamad et al. (2015) Huang, Lin and
Chuang (2006) Manolopoulos (2008) and Shaw and Gupta (2015) that financial rewards lead
to higher employee motivation.
However, it does not support the argument of Fein (1973), Reif (1975) and Harel and Tzafrir
(1994) that pay and fringe benefits are the most important factors for motivating workers
since Table 4.5 shows higher level of beta value for non-financial rewards (b=0.431).
Similarly, Cameron and Pierce (1994) findings that financial incentives enhance the
motivation of employees more effectively than non-financial were not supported. The reason
for the contradictory results might be partly explained by that customer service employees,
emotional labour, differ from the examined population (knowledge and blue-collar workers)
of the previously mentioned articles. Moreover, as it was discussed by Deci (1972) and
Werner and Ward (2004) possible explanation can be that although financial incentives have
a positive impact on employees’ motivation those cannot guarantee high overall motivation
levels as they might reduce workers’ intrinsic motivation.

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On examining the elements of the financial rewards, both indicators; salary (p=0.020,
b=0.197, t=2.355) and fringe benefits (p=0.001, b=0.292, t=3.495) revealed significant
relation to employee motivation. It supports the study of Namasivayam, Miao and Zhao
(2007) that employees in non-managerial position will not exert high levels of motivation by
only receiving a satisfying base salary but by the combination of salary and fringe benefits.
Similarly, the importance of fringe benefits was also highlighted in the research of Danish
and Usman (2010). These results entailed that the higher implementation of fringe benefits,
along with satisfying base salary will advance the growth of motivation among customer
service employees.
Evaluating the results of the regression analysis, non-financial rewards significantly predict
customer service employees’ motivation (p=0.000, t=6.162, b=0.431), therefore hypothesis 2
can be accepted. This study finding reinforce the theory of Herzberg (1959), that non-
financial rewards, such as personal growth and advancement, increased responsibility and
sense of achievement are the primary reason for enhanced motivation among the workforce.
Similarly, findings of Deci (1973) and Kanungo and Hartwick (1987) were supported that
personal development opportunities and friendly supervision need to be present at the
workplace in order to reach higher levels of motivation.
Controversially, argument of Rynes, Gerhart and Minette (2004) that non-monetary rewards
cannot contribute to reaching higher order needs in the motivation hierarchy, is not consistent
with the present findings since non-financial rewards were found to be highly important for
customer service employees. However, a possible explanation for the controversial results
can be that their research focused on employees’ behaviours at the point of their recruitment,
while the present research included participants who were already doing the job. This might
explain the differences in the results, since at the point of joining an organization, monetary
rewards can be easily evaluated and compared against other companies, thus serve as a
motivator. However, after some time relational and social rewards make high impact on the
daily work routines of the employees, thus affects the motivational levels continuously.

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Evaluating the non-financial elements of the reward package, working condition (p=0.000,
b=0.423, t=5.372) and friendly supervision were found to be the strongest indicators of
employee motivation. Therefore the argument of Nohria, Groysberg and Lee (2008) that
employees need to bond at their workplace to drive motivation was supported. They argued
this bond can be achieved by providing pleasant working condition and good relationships
among co-workers and supervisors. These results postulates that hygiene factors of
Herzberg’s model (1959) cannot only prevent from employee dissatisfaction but have
motivational power as well.
On the other hand, career development (p=0.033, b=0.161, t=2.157) was only scored the
third most significant non-monetary reward. It indicates that for customer service employees
the so-called ‘motivators’ (Herzberg, 1959) only have moderate effect on their motivation.
Kanungo and Hartwick (1987) examining white-collar workers revealed stronger relationship
between career-development opportunities and motivation. The contradictory nature of
findings can be explained by that in customer service roles, workers have limited
advancement opportunities and they are aware of that at the point of recruitment, thus they
become motivated by other factors (Malhotra, Budhwar and Prowse, 2007).
Although training (p=0.021, b= -0.186, t= -2.338) was found to be a significant indicator of
employee motivation; it revealed negative results in contrast to Fey et al. (2000) and
Tharenou, Saks and Moore (2007). The reason for that can be explained by the argument of
Chew and Chan (2008) that training which does not serve the workers’ need as a result of
lack of time, resources and facilities cannot enhance positive human resource management
outcomes. Moreover, training may not be seen as a reward but a sign of incompetence
consequently lower employee motivation (Marescaux, Winne and Sels, 2013).
Regardless of the significant findings of previous literature on verbal rewards, feedback and
recognition, (Deci, 1972; Hackman and Oldham, 1980; Hewett and Conway, 2015 and
Kanungo and Hartwick, 1987) and on autonomy (Hackman and Oldham, 1980 and Kanungo
and Hartwick, 1987), these rewards did not suggest significant impact on customer service
employees’ motivation. These study findings entails, that organizations need to put higher
emphasis on ‘hygiene’ factors to drive sustainable employee motivation among front-line
workers than on ‘motivators’.

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5.1.3 Evaluation of the Control Variables
The results of the added control variables indicated that age is not significant in determining
employee motivation, whereas employment status has a significant (p=0.012) effect on it
with a beta value of 0.192. Although, Eberhardt and Shani (1984) suggested that part-time
employees are more motivated as a result of lack of knowledge and negative information
about the occurring events at their workplace and organizational politics, the present research
revealed that full-time employees are more motivated. However, it might be explained by the
argument of Clinebell and Clinebell (2007) and Thorsteinson (2003) that the more working
hours of full-time employees prevents them to engage in many other non-work related
activities, compared to part-time employees, thus it makes them more involved with their
work and workplace. Thereby, the higher levels of involvement make them more motivated.

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COMMITMENT
Evaluating the results of the regression analysis on affective commitment, the findings are in
contrast to the theory that compensation and financial benefits increase employees’ affective
organizational commitment (Marescaux, Winnie and Sels, 2013 and Ogilvie, 1986);
therefore, hypothesis 3 needs to be rejected. This finding also differs from those from Asian
setting (Miao et al., 2013, Newman and Sheikh, 2012a, 2012b and Nazir et al. 2016) who
revealed strong relatedness between these variables. However, regardless that Paul and
Anantharaman (2004) found strong correlation between monetary rewards and affective
commitment, their regression analysis did not reveal significant relatedness either. Moreover,
despite that Marescaux, Winnie and Sels (2013) found significant impact of monetary
rewards on commitment, their research provided evidence for the more perceived
favourability of socio-emotional, non-financial rewards.
The reason for the controversial results can be partly explained by the study of Farndale and
Murrer (2015) which compared the impacts of financial rewards on affective commitment in
three different countries; Mexico, the U.S. and the Netherlands. They did not find significant
relationship in the western European context while the other two countries showed evident
relationships. Therefore, the present UK based study on customer service employees also
supports the view of Huang and Vliert (2003) that workers who belong to a more feminine
and/or individualist cultures less likely to value monetary rewards and economic security
more than intrinsic, relational rewards. In addition to this, another reason might be that
monetary rewards (fringe benefits, bonuses and financial promotions) are limited among
front-line employees and the instructions on how to attain extra monetary rewards might not
communicated and administered clearly in the organizations where the investigated
participants work (Ogilvie, 1986). Consequently these factors decrease affective commitment
levels.

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Despite the previously discussed findings that financial rewards significantly did not predict
organizational commitment, the investigation of the separate indicators revealed that fringe
benefits (p=0.000, b=0.337, t=3.859) are perceived as influential in determining commitment
levels. While this finding supports the study of Ahmad and Scott (2015) that most fringe
benefits have strong or moderate impact on affective organizational commitment, it is in
contrast to argument of Wang (2004) that those can only affect their continuance
commitment, to stick with the organization but will not make them to put high levels of
efforts on behalf of the organization. However, the present study findings suggest that
investment into fringe benefits have the potential to contribute to the enhancement of front-
line employees’ affective commitment.
Investigating the impacts of non-financial rewards, statistically significant, strong positive
relationship was found with customer service employees’ affective organizational
commitment (p=0.000, t=15.159, b=0.827). This evidence suggests that non-financial,
relational rewards play a significant role in determining employees’ commitment to the
organization where they work, which supports previous research conducted by Chew and
Chan (2008) Gagné (2009) and Paul and Ananthataman (2004). Research outcomes of
Mottaz (1988) that intrinsic and social rewards make stronger positive impact on this variable
than monetary rewards were also reinforced. Likewise, the present study is also consistent
Malhotra, Budhwar and Prowse’s (2007) research from a similar research context, that non-
financial rewards are perceived as more important to customer service employees’ affective
commitment than financial compensation. Consequently, it leads to the acceptance of
hypothesis 4.
Although, Chew and Chan (2008) recognised that non-financial rewards are sufficient to
enhance workers’ affective commitment, they argued that financial rewards are as important
in determining high levels of commitment. The present finding, strongly reject this view,
since non-financial rewards at beta value of 0.827 show significantly stronger contribution to
organizational commitment of customer service employees than financial ones b= -0.57. In
addition to this, as a result of high relatedness of non-financial rewards and affective
commitment, the present study also rejects the view of Angle and Perry (1983) that
organizational commitment is not related to an intrinsic need fulfilment which can be
achieved by recognition, autonomy and career development.

MSc Dissertation ZsuzsannaSzucs-1218863

MSc Dissertation ZsuzsannaSzucs-1218863

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