Total reward satisfaction profiles and work performance: A person-centered approach

Abstract

It has recently become an incentive management challenge for organizations to implement a total reward system. Existing variable-centered studies have neglected to explore the incentive effect of a total reward system from the perspective of individual differences. Our study aimed to initially investigate the profiles of total reward satisfaction (TRS) and the impact of these profiles on work performance. Using a person-centered approach, two studies were conducted using retail industry employees in China as samples. Study 1 identified the TRS profiles of 429 samples using latent profile analysis. Study 2 replicated Study 1's configuration of profiles and examined the relationship of these profiles with demographic variables and work performance using 885 samples. Our results were as follows: (1) there were four quantitatively and qualitatively distinct profiles (subpopulations) of TRS, namely, dissatisfied (DS), development and career opportunities satisfied-dominant (DOS-dominant), work-life balance satisfied-dominant (WLS-dominant), and compensation satisfied-dominant (CS-dominant); (2) demographic variables involving gender, age, education, and position level affected the likelihood of membership in each TRS profile; and (3) the four profiles predicted different levels of work performance, or more specifically, different levels of task and contextual performance. The task and contextual performance of the four subpopulations listed from best to worst were WLS-dominant, DOS-dominant, CS-dominant, and DS. For practical management, organizations should customize a classified total reward system according to employee subpopulations to improve work performance.