Reward Systems

The current research aims to explore the relationship between incentive/rewards and employee's performance through the mediating role of job satisfaction in the Saudi context. Using a quantitative method is suitable for research purposes. The sample was selected from full-time employees working in the largest region of the Kingdom, the Eastern Region, where the diversity of the industry provides a good representation of the whole country. Data were collected from January to March 2022 via a questionnaire developed for this study using online Google Forms.

Previous research investigated a relevant relationship through the quantitative approach and supported the credibility and validity of the instrument used to measure the relevant constructs. Data for this research was gathered using four instruments and compiled into one survey questionnaire (Supplementary Materials). The first section was devoted to collecting data on subjects' personal characteristics, while the other sections were used to measure the research variables: incentive/rewards, employee's performance, and job satisfaction. The researchers ensured the confidentiality and clarity of the survey questions and how appropriate it was for use in the targeted space, the Saudi industrial sector. The length of the survey was also carefully maintained to ensure that participants' interest would be preserved. Distribution techniques used to facilitate data collection were social networking and the snowballing amongst employees. The Saudi convenience sampling technique was adopted for cultural homogeneity and accessibility purposes. More than 300 questionnaires were distributed, 216 were returned and eligible for data analysis. The researchers therefore concluded that the data was adequate for Statistical analysis due to the large sample size and normality, through two-step Structural Equation Modeling - the measurement model or confirmatory factor analysis and structural model through SPSS AM`OS.

Each construct was measured through a set of instruments recorded on a five-point Likert type scale. Reliability, factor loadings, and goodness-of-fit for each scale of the study were conducted, and quantitative analysis of the empirical data was carried out to diagnose the relationships among the variables. Moreover, SEM allows to concurrently test the mediating hypothesis, rather than separate regression analyses for testing them.

Research Model and Instrument

Following the discussion of the theoretical background and related literature, this research proposes an integrated model by using incentive/rewards as independent constructs which are predicted to influence employees' performance (dependent construct), also job satisfaction was predicted to facilitate the relationship between the independent and dependent constructs (see Figure 1).

Figure 1. Hypothesized Model Proposing the Direct and Mediating Relationships.

The data for this study were gathered from one survey with four sections. The first section, which established the characteristics of the respondents, was created by this research' authors. The other sections of the survey required participants to rate their levels of incentives and rewards systems (IR), employee performance measures (PM), and job satisfaction (JS) preferences with regard to differing dimensions of their experiences of working in the industry. The questionnaire was designed using a five-point Likert scale (1 = strongly disagree; 2 = disagree, 3 = Neither agree nor disagree, 4 = agree, and 5 = strongly agree). The instruments used in the current study mostly showed good reliability scores of more than 0.8.

The second section, concerning incentives and rewards (IR), contains 10 questions adopted from several reliable studies. An example question was (Financial incentives are important to me and to my desire to excel at my job).

Section three, the employee performance measures (PM) section, was dedicated to measuring respondents' impressions of their employers' performance and the effect of incentives on performance from their perspective. This section contains four questions about the perception of employee performance. An example question was (I have a drive to achieve more when I am motivated morally).

Lastly, section four, the job satisfaction (JS) section, measures the degree of satisfaction of employees with the job itself, their position and independence within their work environment, and with incentives provided in their company. The measurements were conducted through the short form of the Minnesota Satisfaction Questionnaire. This is in line with many researchers who use this well-established and highly reliable questionnaire to measure job satisfaction in their respective studies. This section measures the degree of satisfaction of participants through five questions answered in Likert scale format. An example question was (What is your level of satisfaction with regard to financial incentives provided by your company).

Data Analysis Procedure

A two-step modelling technique which is recommended for conducting structural equation modeling (SEM). Thus, the following steps were followed to carry out the data analysis: In the first stage, each latent construct and its respective indicators were identified. Items' reliability and their respective loadings on their appropriate latent constructs were assessed independently to test the reliability, factor loadings, confirmatory factor analysis, constructs correlations covariances and significance, and goodness-of-fit for each scale of the study.

In the second stage, the structural model, the overall relationships between constructs were focused on by specifying how each construct appears in the model. The logic behind this two-step approach is to attain an accurate representation of the reliability of the measurements whilst avoiding the interactions between measurements and the structural model.