Effect of informal rewards on employee motivation and the leaders’ use of informal rewards to achieve organizational goals

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Prasoon Jain

Abstract

IT companies face a major problem of attrition and turnover with employees switching organizations frequently and loss in motivation to achieve higher levels of growth as they move higher along the career path. Compensation plays the role of basic hygiene factor which guarantees no satisfaction and cannot be the sole reason of employee motivation. Also in this era of economic crisis achieving higher levels of growth will be only possible with employees dedicated towards work. The primary motive for doing this research is to understand the effect of informal rewards on employee motivation and how these awards can effectively help to achieve organization goals. The study is based on data collected from employees working in IT organizations based in Pune, Bangalore, Hyderabad & Indore. A structure questionnaire was distributed and the collected data was analyzed using correlation to study the impact of informal rewards on employee motivation. The results from the study reveal that employee recognition programs, leisure time, approval socially and acknowledgement socially are important tools in an organization to drive employee motivation.

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