Utilizing non-financial rewards as a competitive advantage in attracting and retaining employees

Abstract

Most research in terms of reward focuses on the financial aspects. Little has been done to understand the value of non-financial rewards. The objective of this study is to determine if South African organisations are utilising nonfinancial rewards as a competitive advantage in attracting and retaining employees. A survey was developed and distributed to gather data regarding the preferences of organisations and individuals for financial versus non-financial rewards. The data was statistically analysed to determine the organisational value of both – with special attention on how organisations use non-financial rewards. As expected, organisations indicated a preference for financial rewards, but this preference was also strongly indicated by individuals. Given the cost effectiveness of non-financial rewards, and its long-term value, the study determines that there is still a place for such rewards within the broader context of the total reward approach. The cost and legislative implications associated with financial rewards makes non-financial rewards, if well positioned, an attractive option as a distinctive competitive advantage in attracting and retaining employees. In addition, it presents organisations with a certain level of fluidity in offering alternatives to employees and in dealing with profitability challenges.