The impact of human resource management with regard to the reward system on the organizational performance improving

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Rabiyatul Jasiyah, Eko Muliansyah, Rita Meutia, Vegalyra Novantini Samodra, Indarti Indarti

2025 Economic Annals-XXI Vol. 216 Issue 7-8 Article Cited by 0 SDG 16SDG 17 Quartile

Abstract

This study investigates the effect of reward systems on organizational performance in Indonesian companies. The research adopts a descriptive survey design with an applied orientation. Data were collected in 2024 from a sample of 400 employees and managers working in Jakarta-based firms and analyzed using correlation and regression techniques. The findings reveal that all components of the reward system are positively and significantly associated with organizational performance. Regression results indicate that reward system variables explain 47.8% of the variance in employee productivity, with reward justice emerging as the strongest predictor (β = 0.365). In addition, employee satisfaction was found to mediate the relationship between reward justice and productivity, with an indirect effect of 0.275. These results highlight the importance of implementing flexible and fairness-based reward systems to enhance organizational performance. © CC BY 4.0.

Affiliations

Muhammadiyah University of Buton, 36 Jl. Betoambari Str., Kota Baubau, Sulawesi Tenggara, 93724, Indonesia; Luqman AL-Hakim Islamic Religious University (STAI Lukman Al Hakim), 1 Jl. Kejawan Putih Tambak VI Str., Kejawaan Putih Tambak, Kec. Mulyorejo, Surabaya, 60112, Indonesia; Syiah Kuala University (Universitas Syiah Kuala), 441 Jl. Teuku Nyak Arief Str., Kopelma Darussalam, Kec. Syiah Kuala, Kota Banda Aceh, Aceh, 23111, Indonesia; Al-Azhar Islamic University (Universitas Islam Al-Azhar), 20 JI. Unizar Str., NTB, Turida, Mataram City, 12110, Indonesia; State University of Surabaya, Universitas Negeri Surabaya, 31.364 Jl. Lidah Wetan Str., Surabaya, 60213, Indonesia

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