Reward Strategy and Employee Commitment: Moderated by Empowerment

Abstract

Organizational commitment also termed as employee commitment continues and remains to be an important element in any sector in the economy. Interest in triggers and stimulants of employee commitment has ramped up among researchers and organizations due to intensified competition for highly skilled and talented staff brought about by free labor market. The study set to find out the effect of reward strategy on employee commitment. Secondly, it also sought to establish the moderating effect of employee empowerment on reward strategy and employee commitment. Social exchange theory in this study illustrates the connection between reward strategy and employee commitment through the reciprocity principle. Data was collected using a self-administered questionnaire on a sample of 394. Regression analyses was used to test the hypotheses. The results were that reward strategy applied by the commercial banks had a positive significant effect on employee commitment. Further, it was established that employee empowerment had a moderating effect on reward strategy and employee commitment therefore validating the aims of the study. From these findings, organizations should leverage on reward strategy and empowerment to bolster and strengthen commitment in their employees. The implications, recommendations and conclusion have been comprehensively discussed in the study.

Keywords: Reward Strategy, Employee commitment, Empowerment, Moderation.

DOI: 10.7176/EJBM/14-22-10

Publication date: November 30^th 2022