Impact of reward system on employee performance in banking sector

The aim of the study was to identify the impact of reward system on employee performance in banking sector of Karachi Pakistan. Rewards are very essential for every organization. They can engage organization mission and mend the overall sense of community. A good quality of reward makes organization effective and improves the performance of employees’ similarly poor reward system make organization ineffective and leads the employee performance to unproductive. So, organization use reward for improving their employee performance and their morale. Several survey and experience of HR professionals expose that the rewards increase employee motivation like benefits, pay, and incentives. It is clear that there is a research gap in this area and further research needs to be carried out in order to find out whether rewards have any impact on employee performance in banking sector of Karachi, Pakistan. The study followed the quantitative technique to achieve the objectives of this study by explaining and identifying the relation and impact of reward on employee performance. There were six independent variables were taken for this study. These are from intrinsic reward (recognition, career growth, motivation); from extrinsic reward (salary, fringe benefit, recognition). convenience sampling was used to collect the data. Researcher used well-structured and close ended question to measure the responses on a five level likert scale, was given to 300 employees of bank in Pakistan. Software that has been used for analysis is SPSS 17.0. Descriptive research design was used to analyze the data such as mean and standard deviation. Pearson correlation coefficient was used to determine if there is a significant positive correlation between each reward type and employee performance. Regression analysis was used to test the relationship between variables under the study of research objective. Overall performance of banking employees was assessed as satisfactory. This study confirmed that intrinsic and extrinsic reward increase employee performance and it has a positive impact on employee performance.