2.

1 Introduction
In todays competitive global business environment, organizations are able to survive
and compete mainly due to effective human resource management. Hegar (2011) says that
effective organizations always consider their employees the most valuable asset and try to
ensure that their talent is used effectively. He further adds that employees values have also
changed over the decade and employees of each generation bring new expectations and
values (Henry, 2006) to the workplace which they have acquired over the life time.
Bell (2008) points that with the twenty-first century moving forward, organizations
are experiencing four or more generations working together in the workplace, which was
never experienced before. The reason behind the simultaneous presence of all these
generations in the workplace is importantly due to increased longevity and working beyond
the retirement age. Based on this perspective, companies will have to adjust their human
resource functions according the diverse and changing needs and expectations of these
generations (Hankin, 2005).

TaljaardJJ
1.2.1 Benefits of improving job performance

The success of any company can be determined by how well they are able to
utilise and mobilise their resources to give them the best results. Unlike other
resources, human resources have emotions and needs. It is therefore
imperative that management recognises these emotions and needs when
developing their human resource management systems. Effective development
of these systems can provide a competitive human resource advantage. As
access to capital and information becomes a less important means of
advantage so does the human resource become an increasingly important
means of differentiating oneself from ones competitors. This is the reason why
a companys human resources are considered to be its most important asset.

In order to stay competitive and ensure that the company has a long-term
future, it is important to improve these performances on an ongoing basis.
These performances will only improve with the buy-in of the employees into
higher levels of performance motivated by related rewards. The company will
benefit because its labour productivity will increase, labour cost per unit will
decrease and it will become more price competitive. This is especially the case
where the manufacturing process is very labour intensive. The researcher
therefore realises the potential benefit in researching the effectiveness of non
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monetary reward systems in labour intensive companies. Improving job
performance does not happen on its own, but gets driven by peoples
motivation. According to Armstrong and Murlis (1994:40) rewards and more
specifically non-monetary rewards normally drive a person. It is therefore
important to look at the payoffs of non-monetary rewards.

1.2.2 The payoffs of non-monetary rewards

Armstrong and Murlis (1994:40) say that the objectives of reward systems
include the attraction, motivation and retention of employees at all
organisational levels. Over the past couple of years, collective bargaining
instead of plant level bargaining has forced employers to adhere to pay
structures that are negotiated at national level. This has taken away the
flexibility of implementing certain incentives and monetary rewards to motivate
people who perform admirably.

According to Armstrong and Murlis (1994:40) non-financial rewards focus on the
needs most people have, although to different degrees, such as achievement,
recognition, responsibility, influence and personal growth. Gross (1995:133)
says that there are an almost infinite variety of non-cash rewards that
companies can hand out to recognise the contribution of employees. He
mentions examples of a simple thank you note to a paid trip to the Caribbean.
Other examples include T-shirts, vouchers for the canteen, pins and caps.
Parker, McAdams and Zielinski (2000:191) say that non-cash awards carry
trophy value in that they have great staying power because each time you look
at that television set or plaque you are reminded of what you or your team did to
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earn it. Thorpe and Homan (2000:143) mention non-financial rewards such as
recognition, career opportunities, status, responsibility and achievement. Nonmonetary
rewards do not only have payoffs in improvement in performance, but
also benefit the workers. It is therefore important to look at the benefits to lowskilled
employees.

Problem statement
Key focus of the study
As a consequence of competitive markets, technological advancements and globalisation, organisations worldwide
are facing challenges in retaining their human capital. This is no different in South Africa, as research by Kinnear and
Sutherland (2001) has shown. Staff attrition is of concern to organisations because of its high associated cost. It is
estimated that the total cost of an exempted employee turnover amounts to a minimum of one years pay and
benefits (Ramlall, 2004). In addition to the direct costs, the exit of employees also implies the loss of valuable
intellectual capital and thus competitive advantage. In order to retain its staff, organisations often focus on
remuneration and other monetary benefits as their main retention strategy although research has long established
that employees are unlikely to remain in the employment relationship when incentivised by monetary benefits alone
(e.g. Herzberg, 1959). This begs the question as to what other types of rewards could be effective in reducing the risk
of staff turnover in South African organisations through their relationship with affective commitment and
motivation.
Motivation is driving force for arousing ,selection and direction
of behaviour that can lead employees to better performance
when necessary conditions are met. It is a term used to define
failure or success of task. While the opportunity and ability
tend to be stable and difficult to change for the personnel,
motivation has flexibility, that is, it can be changed by some
means. Furthermore, it is apparent that in the absence of
willingness to perform; capacity and opportunity will not
generate the desired results.
What are the benefits of highly motivated staff?
Research has shown that employees who are highly motivated are likely to:
have fewer absences from work
deliver higher levels of performance
work harder when workplace demands are high
be loyal to their organisation resulting in a reduction in staff turnover and deliver higher
levels of customer service resulting in greater customer retention.

Given these benefits, it is clear that highly motivated employees are likely to have a positive impact on
your bottom line.