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Rewarding employees in turbulent economies for improved organisational performance: Exploring SMEs in the South-Eastern European region

Prouska, Rea; Psychogios, Alexandros G.; Rexhepi, Yllka

Authors

Rea Prouska

Alexandros G. Psychogios

Yllka Rexhepi

Abstract

© 2016, Emerald Group Publishing Limited. Purpose: The purpose of this paper is to explore the application of total reward practices in small and medium-sized enterprises (SMEs) in the South-Eastern European (SEE) region and the reward elements positively affecting organisational performance. Design/methodology/approach: The sample consists of 199 SMEs operating in SEE countries which are either under economic crisis or transition: Greece, Bulgaria, Romania, Albania, Kosovo and the Former Yugoslav Republic of Macedonia. Findings: SMEs in the SEE region are implementing a total rewards model which is characterised by a weaker application of individual aspects and by a stronger application of transactional, relational and communal aspects. Within the communal aspects of the model, the study found three elements of the work environment that positively affect organisational performance; work-life balance, employee involvement voice mechanisms, and organisational culture supporting personal and professional development. Practical implications: The study contributes to HR practice; the authors found that a better work environment is positively related to improved organisational performance in these SMEs. This means that in times of economic crisis or transition when HR budgets are limited such non-financial strategies can be a viable alternative to costly financial rewards to such organisations. Originality/value: The study contributes to both theory and HR practice by shedding light on how employee rewards are a ffected in economies under crisis and transition, how SMEs can motivate their employees when faced with significant financial limitations, as well as explores which reward elements can lead to enhanced organisational performance in such organisations.

Journal Article Type Article
Publication Date Sep 5, 2016
Journal Personnel review
Print ISSN 0048-3486
Publisher Emerald
Peer Reviewed Peer Reviewed
Volume 45
Issue 6
Pages 1259-1280
Institution Citation Prouska, R., Psychogios, A. G., & Rexhepi, Y. (2016). Rewarding employees in turbulent economies for improved organisational performance: Exploring SMEs in the South-Eastern European region. Personnel review, 45(6), (1259-1280). doi:10.1108/PR-02-2015-0024. ISSN 0048-3486
DOI https://doi.org/10.1108/PR-02-2015-0024
Keywords Applied Psychology; Organizational Behavior and Human Resource Management
Publisher URL http://www.emeraldinsight.com/doi/abs/10.1108/PR-02-2015-0024
Copyright Statement ©2017 University of Hull
Additional Information This is the author's accepted manuscript of an article which has been published in: Personnel review, 2016, v.45, issue 6

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