Academic journal article SA Journal of Human Resource Management

The Relationship between Occupational Culture Dimensions and Reward Preferences: A Structural Equation Modelling Approach

Academic journal article SA Journal of Human Resource Management

The Relationship between Occupational Culture Dimensions and Reward Preferences: A Structural Equation Modelling Approach

Article excerpt


Key focus of the study and background

Employee turnover remains a concern for employers (Silverstone, 2009). Organisations continue to face the challenge of retaining the key skills and competencies required to achieve organisational objectives, particularly so in a very demanding economic climate and competitive talent market (Moore & Bussin, 2012; Munsamy & Venter, 2009; Nzukuma & Bussin, 2011). Bhattacharya and Mukherjee (2009) highlight the association between employee retention and reward. Employee reward is concerned with the reward of individuals as aligned to the value that they add to the organisation (Armstrong, 2002). Despite the introduction of a total reward approach (WorldatWork, 2008), effective reward remains a challenge for organisations.

Trends from the research

Research has considered reward preferences from a range of standpoints in an attempt to better comprehend individual preferences. This has included consideration of the influence of demographic factors such as race, gender, age and marital status (Moore & Bussin, 2012; Nienaber, Bussin & Henn, 2011; Schlechter, Thompson & Bussin, 2015; Snelgar, Renard & Venter, 2013), personality type (Nienaber et al., 2011; Vandenberghe, St-Onge & Robineau, 2008), generational theory (Bunton & Brewer, 2012; Bussin & Van Rooy, 2014; Smit, Stanz & Bussin, 2015; Snelgar et al., 2013), industry (Bussin & Toerien, 2015) and the influence of national culture on reward preferences (Herkenhoff, 2000; Newman & Nollen, 1996; Schuler & Rogocsky, 1998; Westerman, Beekun, Daly & Vanka, 2009), led primarily by Hofstede's (1980) research. Despite these studies, further clarity is still required on how organisations should devise appropriate reward strategies, especially when dealing with non-financial rewards (Armstrong & Stephens, 2005; Schlechter et al., 2015).

While the impact of national culture on reward preferences has been researched (Herkenhoff, 2000; Hofstede, 1980; Westerman et al., 2009), occupational culture offers a further level of culture, which impacts on employee behaviour informed by membership to an occupational group (Lachman, Nedd & Hinings, 1995). As with national culture, occupational culture too may impact on employee behaviour in terms of reward preferences; however, this has not been empirically tested and explored in the literature as yet.

Research objectives

The primary purpose of this study was to research reward preferences from an occupational culture perspective within the South African context. In line with this purpose, the main objective of the research was to propose and evaluate a theoretical model of the relationship between occupational culture dimensions and employee reward preferences. The core research problem relates to a gap in empirical research of the effect occupational culture has on reward preferences.

The potential value-add of the study

By assessing the extent to which occupational groups prefer the different types of reward offered in the workplace, organisations will be more informed and enabled to leverage benefit from the structuring of the different reward elements in accordance with these preferences, thereby aiding retention efforts. In addition, consideration of occupational groups from a time orientation perspective in particular may guide organisations to structure incentive plans in such a manner that the preference for short- or long-term incentives can be optimised to achieve the greatest return for this investment. Organisations too can consider the findings in the application of the principles relating to pay allocation and pay orientation.

What will follow

The next section is a review of the literature, outlining research on the main constructs and integrating it with this research. This is followed by a description of the research design, findings, results and discussion. …

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