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- Title
The Effects of Reward Type on Employee Goal Setting, Goal Commitment, and Performance.
- Authors
Presslee, Adam; Vance, Thomas W.; Webb, R. Alan
- Abstract
The use of tangible rewards in the form of non-cash incentives with a monetary value has become increasingly common in many organizations (Peltier et al. 2005). Despite their use, the behavioral and performance effects of tangible rewards have received minimal research attention. Relative to cash rewards, we predict tangible rewards will have positive effects on goal commitment and performance but will lead employees to set easier goals, which will negatively affect performance. The overall performance impact of tangible rewards will depend on the relative strength of these competing effects. We conduct a quasi-experiment at five call centers of a financial services company. Employees at two locations earned cash rewards for goal attainment while employees at three locations earned points, with equivalent retail value to cash rewards, redeemable for merchandise. Results show that cash rewards lead to better performance through their effects on the difficulty of the goals employees selected. Implications for theory and practice are discussed.
- Subjects
INCENTIVE awards; PERFORMANCE awards; EMPLOYEE benefits; GOAL setting in personnel management; JOB performance; ORGANIZATIONAL commitment; FINANCIAL services industry personnel
- Publication
Accounting Review, 2013, Vol 88, Issue 5, p1805
- ISSN
0001-4826
- Publication type
Article
- DOI
10.2308/accr-50480