2.1.

2 Excellent Performance

Excellent performance refers to the achievement of high standards of work and productivity that

exceed the normal expectations of an employee’s role. It is often characterized by superior

quality of work, innovation, and exceptional outcomes. Excellent performance can be a result of

effective reward management practices that incentivize and recognize high achievers. Excellent

performance in the workplace leads to the consistent achievement of high standards in terms of

task completion, quality of work, and meeting organizational goals. It goes beyond just

performing one's duties; it involves exceeding expectations and continuously improving.

According to Dessler (2017), excellent performance is often driven by a combination of personal

attributes, such as skills and abilities, as well as external factors like the work environment and

leadership support.

The concept of excellent performance is linked to performance management theories such as the

Performance-Based Management Theory, which emphasizes setting clear goals, providing

feedback, and rewarding outstanding performance. High-performing employees are often

recognized through performance appraisals, bonuses, and career advancement opportunities,

which further reinforce their high levels of performance.

2.1.3 Promotion

Promotion refers to the advancement of employees within an organization, typically involving an

increase in responsibilities, status, and salary. Promotions are a key component of reward

management and play a crucial role in employee motivation and performance. They are often

seen as a way to recognize and reward employees' hard work and achievements.
Promotion are often accompanied by an increase in status, authority, and salary. Armstrong

(2020) defines promotion as the progression of an individual within an organization, typically

due to their demonstrated competence and performance. It is a key aspect of career development,

providing employees with opportunities to grow within the organization while fulfilling their

personal and professional goals.

The impact of promotions on employee performance can be understood through theories such as

the Career Development Theory (Super, 1957), which emphasizes the importance of career

growth and advancement in employee satisfaction and motivation. Promotions can enhance

employees' sense of achievement, increase their commitment to the organization, and encourage

them to strive for higher performance.

2.1.4 Motivation

Motivation refers to the internal and external forces that drive individuals to achieve their goals

and perform tasks effectively. In the context of reward management, motivation is often

influenced by the rewards and recognition provided by the organization. Motivated employees

are more likely to exert effort, be productive, and contribute positively to organizational goals.

Motivation also is that force stimulate individuals to take actions that lead to the achievement of

a goal. According to Robbins and Judge (2013), motivation is the willingness to exert high levels

of effort towards organizational goals, conditioned by the effort’s ability to satisfy some

individual need. Motivation in the workplace is often driven by a combination of intrinsic

factors, such as personal growth and achievement, and extrinsic factors, such as pay and rewards.
Theories of motivation, such as Maslow's Hierarchy of Needs (Maslow, 1943) and Herzberg's

Two-Factor Theory (Herzberg, 1959), provide insights into what drives employee motivation.

Maslow’s theory suggests that individuals are motivated by a hierarchy of needs, from basic

physiological needs to self-actualization. Herzberg’s theory identifies motivators (such as

achievement and recognition) and hygiene factors (such as salary and working conditions) that

influence job satisfaction and performance.

2.1.2 Employe Performance

Employee performance is how well a person executes their job duties and responsibilities. Many

commercial Banks assess their employees performance on an annual or quarterly basis to define

certain areas that needs improvement and hence encourage further success in areas that are

meeting or exceeding expectations.

[Link] Employee Motivation

Employee motivation is fundamentally tied to how they perceive the rewards they receive for

their work. Vroom's Expectancy Theory highlights the relationship between rewards and

motivation, suggesting that employees are motivated when they believe that their effort will lead

to a desirable outcome (Lunenburg, 2011). In this context, the design and structure of the reward

system play a critical role in maintaining or boosting employee motivation.

[Link] Employee job Satisfaction

Job satisfaction refers to the degree to which employees feel content and fulfilled with their jobs.

It encompasses various aspects such as the nature of the work, working conditions, relationships
with colleagues, and overall reward. Job satisfaction is a critical outcome of effective reward

management, as it influences employees' attitudes, motivation, and performance.

Job satisfaction once again refers to the extent to which an individual feels content and fulfilled

in their job role. Locke (2016) defines job satisfaction as a positive emotional state resulting

from the appraisal of one’s job or job experiences. When employees are satisfied with their jobs,

they are more likely to perform at a high level, thereby contributing to overall organizational

success.

Theories such as Herzberg’s Two-Factor Theory and the Job Characteristics Model (Hackman &

Oldham, 1976) highlight the factors that contribute to job satisfaction. Herzberg’s theory

differentiates between motivators (such as achievement and recognition) and hygiene factors

(such as salary and job security), while the Job Characteristics Model emphasizes the importance

of job design elements like skill variety, task identity, and autonomy in influencing job

satisfaction.

[Link] Employee Commitment

Employee commitment refers to the level of dedication and loyalty employees have towards their

organization. It reflects their willingness to invest effort and remain with the organization over

time. High employee commitment is often associated with increased job performance, lower

turnover rates, and a stronger alignment with organizational goals.

Employee commitment refers to also as the psychological attachment an employee feels towards

their organization, often reflected in their loyalty and desire to remain with the organization.

Meyer and Allen (1991) describe employee commitment as a multidimensional construct,

encompassing affective, continuance, and normative commitment. Affective commitment is the

emotional attachment employees have to their organization, while continuance commitment is

based on the costs of leaving, and normative commitment reflects a sense of obligation to

remain.

The concept of employee commitment is explored through theories such as Organizational

Commitment Theory (Meyer & Allen, 1991), which identifies three types of commitment:

affective (emotional attachment), continuance (perceived costs of leaving), and normative (sense

of obligation). Reward management practices, such as recognition and career development

opportunities, play a significant role in fostering and maintaining employee commitment.

[Link] Employee Satisfaction

Employee satisfaction is the overall contentment employees feel with their job and work

environment. It is influenced by various factors including job role, work conditions, relationships

with colleagues, and reward. High levels of employee satisfaction are associated with positive

outcomes such as increased productivity, lower absenteeism, and improved organizational

loyalty.

It is also the extent to which employees are content with their jobs and work environment. Job

satisfaction is a multifaceted concept that includes an employee’s feelings about their role,

reward, work-life balance, and relationships within the workplace. Locke (2016) defines job

satisfaction as the pleasurable emotional state resulting from the appraisal of one’s job as

achieving or facilitating the achievement of one’s job values.

Research on employee satisfaction often draws on theories such as the Dispositional Theory

(Judge et al., 2001), which suggests that individual personality traits can influence job

satisfaction, and the Satisfaction-Performance Hypothesis, which explores the relationship

between job satisfaction and job performance. Effective reward management strategies can

enhance employee satisfaction by addressing key factors that contribute to a positive work

experience.

These conceptual reviews provide a foundation for understanding how each variable in your

thesis might interact and impact employee performance in the Nigerian commercial banking

sector.

2.2 Conceptual Framework

Total Reward Management Employee Performance

Reward structure Employee Motivation

Excellent performance Job Satisfaction

Promotion Employee Commitment

Motivation Employee Satisfaction

Fig2.1 Operational Variables

2.2.1 Impact of Reward Structure on Employee Motivation

Employee motivation has been a focal point of research in organizational behavior for decades,

primarily due to its significant influence on productivity, job satisfaction, and overall
organizational performance. A core aspect of employee motivation is the reward structure

implemented by an organization. Reward structures, encompassing both intrinsic and extrinsic

rewards, play a pivotal role in shaping employee behavior and driving motivation. This literature

review aims to explore the various dimensions of reward structures and their impact on employee

motivation, particularly within the context of commercial banks in Nigeria.

Reward structures that are equitable and transparent are more likely to foster motivation among

employees. The Equity Theory by Adams (2015) suggests that employees compare their input-

output ratio to that of others within the organization. If they perceive fairness in the reward

structure, their motivation is maintained; if not, it can lead to dissatisfaction and demotivation.

The relationship between reward structure and motivation is further explained by the Goal-

Setting Theory, which asserts that employees are motivated when they are rewarded for

achieving specific, challenging goals (Locke & Latham, 2022). When the reward structure is

closely tied to goal attainment, employees are more likely to be driven to perform at their best.

An organization's reward structure should also accommodate diverse employee preferences and

needs. While some employees may be motivated by financial rewards, others may value

professional development opportunities or work-life balance initiatives (Kuvaas, 2006).

Therefore, a flexible reward structure that caters to these varying preferences is more effective in

driving motivation.

Research indicates that a performance-based reward structure is a critical component in

enhancing employee motivation. When rewards are linked directly to performance metrics,

employees tend to be more engaged and committed to achieving organizational goals (Pfeffer,
1998). This kind of reward structure promotes a meritocratic work environment where effort and

outcomes are appropriately rewarded.

However, the reward structure must be perceived as achievable and aligned with realistic

expectations. Unrealistic reward expectations can lead to frustration and demotivation among

employees, particularly when goals seem unattainable (Shields et al., 2016). Therefore,

designing a balanced and attainable reward structure is crucial for sustained motivation.

One key aspect of reward structures that significantly influences motivation is recognition.

Employees are more motivated when they feel that their hard work is acknowledged, even if the

rewards are non-financial (Kohn, 1993). Simple gestures such as public recognition or a thank-

you note can boost morale and enhance intrinsic motivation.

Reward structures should be regularly reviewed and adapted to ensure they continue to motivate

employees effectively. Changes in the external environment, such as inflation or shifts in

industry standards, can necessitate adjustments to the reward structure (Milkovich & Newman,

2008). Continuous monitoring ensures that the system remains relevant and motivational.

It's also important to consider the psychological aspects of reward structures in employee

motivation. Cognitive Evaluation Theory suggests that extrinsic rewards can sometimes

undermine intrinsic motivation by shifting the employee's focus from the satisfaction of the work

itself to the external rewards (Deci & Ryan, 2015). Therefore, a balanced approach to reward

structures is essential.

Moreover, reward structures that foster a positive work environment contribute to employee

motivation. When rewards are linked to collaborative efforts, such as team bonuses, they can
encourage teamwork and increase overall morale (Robbins & Judge, 2013). This in turn fosters a

culture of support and motivation among employees.

The implementation of reward structures must be consistent and fair. Inconsistent reward

practices can lead to perceptions of favoritism or unfairness, which can significantly undermine

employee motivation (Greenberg, 1990). To avoid this, organizations must ensure that reward

policies are clearly communicated and uniformly applied.

Historically, reward structures have been conceptualized as mechanisms for reinforcing desired

behaviors in employees. According to Skinner’s (2013) operant conditioning theory, behaviors

that are followed by positive outcomes, or rewards, are more likely to be repeated. This principle

has underpinned much of the research on reward systems, highlighting the significance of

aligning rewards with organizational goals to enhance motivation and productivity. Studies have

consistently shown that a well-designed reward structure can act as a powerful incentive,

encouraging employees to perform at their best (Herzberg, 2016; Lawler, 2011).

A critical distinction in the study of reward structures is between intrinsic and extrinsic rewards.

Intrinsic rewards, such as personal growth, autonomy, and a sense of accomplishment, are

internally driven and fulfill psychological needs. In contrast, extrinsic rewards include tangible

benefits such as salary, bonuses, and promotions. Ryan and Deci (2020) posited that intrinsic

rewards have a more substantial and long-lasting impact on employee motivation compared to

extrinsic rewards. However, the effectiveness of intrinsic versus extrinsic rewards can vary

depending on individual preferences and organizational contexts.

In the context of Nigerian commercial banks, the balance between intrinsic and extrinsic rewards

is particularly crucial. Ukaegbu (2020) observed that in Nigeria, where economic uncertainties
and job insecurity are prevalent, extrinsic rewards often play a more significant role in

motivating employees compared to intrinsic rewards. This finding aligns with the broader

literature suggesting that in environments characterized by economic instability, financial

incentives tend to be a primary motivator for employees (Kovach, 2017; Ajila & Abiola, 2004).

Furthermore, the effectiveness of reward structures is also influenced by the alignment of

rewards with employee expectations and organizational objectives. The expectancy theory of

motivation, proposed by Vroom (2014), emphasizes the importance of the perceived linkage

between effort, performance, and rewards. Employees are more likely to be motivated when they

believe that their efforts will lead to desirable rewards. In a study of Nigerian banks, Eze (2012)

found that employees’ perceptions of the fairness and transparency of the reward system

significantly influenced their motivation and job satisfaction.

Another critical factor is the role of recognition in the reward structure. Recognition, as a form of

intrinsic reward, involves acknowledging and appreciating employees’ contributions. Research

has shown that recognition can enhance employees’ self-esteem and reinforce their sense of

belonging within the organization (Nelson, 2005; Brun & Dugas, 2008). In the context of

Nigerian banks, Akinola (2013) reported that recognition of excellent performance, when

integrated into the reward structure, positively affected employees’ job satisfaction and

commitment.

Promotions, as a component of extrinsic rewards, also play a significant role in influencing

employee motivation. Promotions offer employees not only financial benefits but also

opportunities for career advancement and professional growth. A study by Armstrong and Murlis

(2007) highlighted the importance of clear and achievable promotion pathways in maintaining
employee motivation. In Nigerian banks, where hierarchical structures are common, the prospect

of promotion can be a strong motivator for employees to enhance their performance and

commitment (Ogunyomi& Bruning, 2016).

The impact of reward structures on employee motivation is further influenced by cultural and

contextual factors. In a cross-cultural study, Hofstede (2010) identified that individuals from

different cultural backgrounds have varying preferences for reward types and structures. For

instance, in collectivist societies like Nigeria, group-based rewards and recognition may be more

effective in motivating employees compared to individual-based rewards. This cultural

perspective underscores the importance of designing reward structures that are culturally

sensitive and tailored to the specific needs of the workforce (Aguiniset al., 2013).

Moreover, the role of leadership in shaping the reward structure and its impact on employee

motivation cannot be overlooked. Leaders play a crucial role in communicating and

implementing the reward structure, as well as in fostering a motivational climate within the

organization. According to Bass and Riggio (2006), transformational leaders who inspire and

motivate their employees can enhance the effectiveness of the reward structure. In the context of

Nigerian banks, leaders who demonstrate a commitment to employee development and

recognition can significantly influence the motivation levels of their teams (Avolio et al., 2009).

Despite the positive impacts of reward structures on employee motivation, there are potential

drawbacks that organizations need to consider. Excessive reliance on extrinsic rewards can lead

to a decrease in intrinsic motivation, a phenomenon known as the "overjustification effect" (Deci

et al., 1999). Additionally, poorly designed reward structures that do not align with employee
values or organizational goals can lead to dissatisfaction, decreased motivation, and even

counterproductive behaviors (Kerr, 2015; Pfeffer & Sutton, 2006).

2.2.2Effect of Recognition of Excellent Performance on Employee’s Job Satisfaction

Employee recognition is increasingly recognized as a critical component of organizational

success and a significant determinant of job satisfaction. Recognition of excellent performance

can take various forms, including verbal praise, awards, public acknowledgment, and other

incentives. The impact of such recognition on job satisfaction is profound and has been the

subject of numerous studies in the field of organizational behavior. This literature review

explores the effect of recognition on employee job satisfaction, emphasizing the mechanisms

through which recognition contributes to a positive work environment and enhances employee

morale, particularly within the context of Nigerian commercial banks.

Recognition, as a component of intrinsic rewards, fulfills employees' psychological needs for

appreciation, respect, and self-actualization. According to Herzberg’s Two-Factor Theory,

recognition is a key motivator that can lead to higher levels of job satisfaction (Herzberg, 2016).

This theory distinguishes between hygiene factors, which prevent dissatisfaction, and motivators,

which promote satisfaction and motivation. Recognition falls under the category of motivators,

suggesting that when employees feel valued and acknowledged for their contributions, their

satisfaction with their jobs increases.

The relationship between recognition and job satisfaction has been empirically supported by

various studies. Brun and Dugas (2008) found that employee recognition significantly

contributes to job satisfaction by reinforcing positive behavior and fostering a sense of belonging

within the organization. This sense of belonging, in turn, enhances employees' commitment and
loyalty to the organization. Similarly, a study by Bishop (2017) revealed that employees who

receive regular recognition are more likely to report higher levels of job satisfaction compared to

those who do not receive such acknowledgment.

In the context of Nigerian commercial banks, where the financial sector is highly competitive

and performance-driven, the role of recognition becomes even more critical. A study by Akinola

(2013) in Nigerian banks demonstrated that employees who received recognition for their

excellent performance exhibited higher levels of job satisfaction and were more motivated to

maintain or improve their performance. This finding underscores the importance of

implementing effective recognition programs to boost employee morale and enhance job

satisfaction in the banking sector. These relationships between excellent performance and job

satisfaction is often seen as reciprocal.

High-performing employees tend to experience greater job satisfaction because their efforts are

recognized and rewarded. Conversely, satisfied employees are more motivated to deliver

excellent performance (Judge et al., 2021). This dynamic interaction emphasizes the importance

of fostering both performance excellence and job satisfaction within an organization.

Research suggests that job satisfaction is influenced by various factors, including the nature of

the job, working conditions, reward, and opportunities for growth (Spector, 1997). These factors

also play a critical role in determining an employee's ability to perform excellently. For instance,

employees who have access to the resources they need to complete their work effectively are

more likely to perform at a high level and feel satisfied with their job.

Herzberg’s Two-Factor Theory (2022) provides further insights into the connection between

performance and satisfaction. The theory suggests that there are certain factors, such as
recognition and achievement, which directly influence job satisfaction and performance. These

motivators encourage employees to excel in their roles, while the absence of hygiene factors,

such as fair pay and safe working conditions, can lead to dissatisfaction and hinder performance.

Employee autonomy is another critical factor that influences both job satisfaction and

performance. When employees are given the freedom to make decisions about how they

complete their work, they are more likely to feel satisfied and motivated to perform at a high

level (Hackman & Oldham, 2016). Autonomy fosters a sense of ownership and responsibility,

which can lead to improved performance outcomes.

The role of leadership in driving excellent performance and job satisfaction cannot be overstated.

Effective leaders create a supportive work environment that fosters both high performance and

job satisfaction. According to Bass (1990), transformational leadership, which focuses on

inspiring and motivating employees, is particularly effective in encouraging excellent

performance and job satisfaction among team members.

Organizational culture also plays a significant role in shaping both performance and satisfaction.

A culture that promotes collaboration, continuous improvement, and recognition of employee

efforts can lead to higher levels of both (O'Reilly et al., 1991). When employees feel that their

contributions are valued and that there is a strong alignment between their personal values and

the organizational culture, they are more likely to perform at an excellent level and experience

job satisfaction.

Moreover, psychological empowerment can significantly affect both performance and job

satisfaction. Employees who feel empowered to influence their work environment and outcomes

are more likely to exhibit excellent performance and job satisfaction (Spreitzer, 1995). This
sense of empowerment fosters a proactive attitude, which is essential for both achieving high

performance and maintaining job satisfaction.

Job satisfaction and performance are also impacted by work-life balance. Employees who can

balance their personal and professional responsibilities are more likely to be satisfied with their

jobs and perform well. Research shows that organizations that prioritize work-life balance tend

to have more engaged and high-performing employees (Greenhaus &Beutell, 2015). Thus,

creating policies that support work-life balance can contribute to both excellent performance and

job satisfaction.

Furthermore, the mode of recognition plays a crucial role in determining its effectiveness. Verbal

praise and public acknowledgment are often considered the most powerful forms of recognition,

as they provide a personal touch and can enhance employees' self-esteem and confidence

(Kouzes & Posner, 2012). A study by Nelson (2005) found that employees who were publicly

recognized for their achievements reported higher levels of job satisfaction and were more likely

to recommend their organization as a great place to work. This finding is particularly relevant in

the context of Nigerian commercial banks, where public recognition can serve as a powerful

motivator for employees.

In addition to enhancing job satisfaction, recognition of excellent performance also contributes to

other positive outcomes, such as increased productivity, reduced turnover, and improved

organizational commitment. A study by Deci et al. (1999) showed that recognition not only

boosts job satisfaction but also enhances employees' intrinsic motivation, leading to higher levels

of productivity and performance. This is particularly important in the banking sector, where

employee performance directly impacts the organization's financial success and competitiveness.
Recognition of excellent performance is a powerful tool for enhancing employee job satisfaction

and motivation. By providing timely, specific, and fair recognition, organizations can create a

positive work environment that fosters employee engagement, loyalty, and productivity. In the

context of Nigerian commercial banks, where the competition for talent is intense, implementing

effective recognition programs can be a key differentiator in attracting and retaining top talent.

Future research should focus on exploring innovative recognition strategies that address the

diverse needs and preferences of employees in the Nigerian banking sector.

2.2.3 Role of Promotion on Employee Commitment

Employee commitment is a crucial factor in organizational success, as it reflects the level of

dedication and loyalty employees have toward their organization. One of the key determinants of

employee commitment is the opportunity for promotion. Promotion, defined as the advancement

of an employee to a higher position with increased responsibilities and benefits, serves as a

powerful motivator and a critical component of career development. This literature review

examines the role of promotion in enhancing employee commitment, with a particular focus on

the dynamics within Nigerian commercial banks.

Promotions play a vital role in enhancing employee commitment by providing opportunities for

career advancement, recognition, and professional growth. By implementing fair and transparent

promotion policies, organizations can foster a culture of commitment and engagement, leading to

improved job satisfaction, loyalty, and productivity. In the context of Nigerian commercial

banks, where the financial sector is highly competitive and performance-driven, effective

promotion practices can be a key differentiator in attracting and retaining top talent. Future
research should focus on exploring innovative promotion strategies that address the diverse

needs and preferences of employees in the Nigerian banking sector.

These two variables are closely linked, as promotional opportunities are often seen as a reward

for employee loyalty and hard work. Employees who perceive that they have a clear path to

advancement within the organization are more likely to remain committed and motivated to

perform well (Kuvaas, 2006). This link suggests that promotions play a significant role in

enhancing employee commitment, particularly in fostering affective commitment.

The concept of promotion is closely tied to the psychological contract between employees and

their organization. According to Rousseau (1995), the psychological contract encompasses the

implicit expectations and beliefs employees have about their employment relationship. When

organizations fulfill these expectations through fair and transparent promotion policies,

employees are more likely to develop a strong sense of commitment to the organization

(Morrison & Robinson, 1997). This commitment, in turn, leads to increased job satisfaction,

loyalty, and a willingness to go above and beyond in their roles (Meyer & Allen, 1991).

The role of promotion in enhancing employee commitment is also supported by the equity theory

of motivation. This theory, proposed by Adams (2013), suggests that employees compare their

input-output ratio with that of their peers. When employees perceive that their contributions are

fairly rewarded through promotions, they are more likely to feel valued and committed to the

organization. Conversely, a lack of promotion opportunities or perceived inequity in promotion

decisions can lead to dissatisfaction and decreased commitment (Greenberg, 2017). In Nigerian

commercial banks, where competition for promotions can be intense, ensuring fairness and
transparency in promotion processes is essential for maintaining employee commitment (Adeoye

& Fields, 2014).

In addition to the direct impact of promotion on employee commitment, promotions also play a

crucial role in shaping organizational culture and values. Promotions serve as a signal to

employees about the behaviors and competencies that are valued by the organization. When

organizations promote employees based on their alignment with organizational values and goals,

it reinforces a culture of commitment and engagement (Morrison, 1996). In Nigerian commercial

banks, where organizational culture is shaped by the leadership and management practices,

promotions based on merit and performance can foster a culture of excellence and commitment

(Oladipo et al., 2012).

The availability of promotion opportunities can also contribute to an employee’s sense of job

security, which is another factor influencing commitment. When employees believe that there is

room for advancement within the organization, they are more likely to feel secure in their roles

and, consequently, more committed to the organization (Robbins & Judge, 2013). Job security,

enhanced by the possibility of promotion, thus serves as a motivating factor for long-term

commitment.

Promotions are not only about moving up the organizational hierarchy; they also involve

professional growth and development. Greenberg and Baron (2008) argue that employees are

more committed to organizations that provide opportunities for skill enhancement, learning, and

personal development. This type of promotion, focused on individual growth rather than just

positional advancement, can greatly contribute to an employee's sense of commitment.

Promotions can also enhance employee commitment by reinforcing organizational identification.

When employees are promoted, they often feel a stronger sense of belonging and identification

with the organization (Ashforth & Mael, 2019). This enhanced organizational identification leads

to higher levels of commitment, as employees become more invested in the organization's

success and goals.

Furthermore, employee commitment can be influenced by the type of promotion offered.

Vertical promotions, which involve a clear upward movement in the organizational hierarchy,

are traditionally seen as the most desirable. However, lateral promotions, which involve moving

to a different role at the same level, can also enhance commitment if they provide opportunities

for personal growth and skill development (Dessler, 2017). Both types of promotions can

contribute to sustained employee commitment if they align with the employee’s career

aspirations.

In addition to career advancement, promotions often come with increased recognition and status,

both of which are important factors in building employee commitment. According to Herzberg

(2022), recognition is a key motivator, and when employees are promoted, they feel valued and

recognized for their contributions. This recognition enhances their emotional attachment to the

organization, increasing their commitment levels.

Another critical aspect of the relationship between promotion and commitment is the role of

leadership. Leaders play a vital role in identifying and nurturing talent within the organization,

and employees who feel supported by their leaders in their pursuit of promotion are more likely

to remain committed (Bass, 1990). Supportive leadership fosters a culture of trust and loyalty,

which in turn promotes employee commitment.

Promotions can also influence employee commitment through the impact on work-life balance.

Employees who are promoted may experience increased responsibilities, which can affect their

work-life balance. However, organizations that support their employees in managing these

increased responsibilities can help maintain commitment (Greenhaus &Beutell, 2015). Providing

resources and flexibility to help employees balance their new roles can ensure that the promotion

leads to enhanced commitment rather than burnout.

Promotion opportunities also play a key role in retention, which is closely related to employee

commitment. Employees are more likely to stay with an organization if they see opportunities for

advancement. Research by Eisenberger et al. (1997) shows that promotion opportunities are a

significant predictor of employee retention and commitment. By offering pathways to promotion,

organizations can retain top talent and foster long-term commitment.

Despite the positive impact of promotions on employee commitment, there are potential

challenges and drawbacks that organizations need to consider. One of the main challenges is the

limited availability of promotion opportunities, particularly in organizations with flat structures

or limited growth potential. In such cases, employees may become frustrated and disengaged,

leading to decreased commitment and increased turnover (Griffeth et al., 2020). In Nigerian

commercial banks, where competition for promotions is high, managing employee expectations

and providing alternative career development opportunities, such as lateral moves or skill

development programs, can help maintain commitment (Ajibola & Ogunsanya, 2014).

2.2.4 Effect of Motivation on Employee Satisfaction in Nigerian Commercial Banks

The relationship between motivation and employee satisfaction is complex, as motivation

influences the degree to which employees feel satisfied with their work. Herzberg's two-factor
theory (2022) divides motivational factors into hygiene factors and motivators. Hygiene factors,

such as salary, work conditions, and company policies, do not necessarily motivate employees

but can lead to dissatisfaction if inadequate. Motivators, such as recognition and achievement,

are intrinsic factors that drive employee satisfaction.

Intrinsic motivation, which comes from within an individual, plays a significant role in

determining employee satisfaction. According to Deci and Ryan (2015), individuals are

intrinsically motivated when they engage in work activities for the inherent enjoyment and

satisfaction derived from the work itself, rather than for external rewards. Intrinsically motivated

employees are more likely to experience higher levels of job satisfaction because they derive

personal fulfillment from their roles.

Extrinsic motivation, driven by external rewards such as pay, promotions, and bonuses, also has

a significant impact on employee satisfaction. Vroom’s Expectancy Theory (2014) suggests that

employees are motivated when they believe their efforts will lead to desirable outcomes, such as

rewards or recognition. When extrinsic rewards meet or exceed employee expectations, job

satisfaction is likely to increase, as employees feel their efforts are valued by the organization.

Research also indicates that motivation significantly impacts employee satisfaction in Nigerian

commercial banks. Adeoye and Olayemi (2014) investigate this relationship by examining how

motivational factors such as financial incentives, job security, and career development

opportunities affect employee satisfaction. Their study finds that employees in Nigerian banks

are motivated primarily by financial rewards and job security, which are crucial for enhancing

job satisfaction. They argue that a well-structured reward system and job stability can

significantly improve employees' overall satisfaction and productivity.

Motivation and job satisfaction are also linked to an employee’s perception of fairness and equity

in the workplace. Adams’ (2015) Equity Theory suggests that employees compare their inputs

(such as effort, skill, and experience) with their outcomes (such as pay, benefits, and recognition)

relative to others in similar roles. When employees perceive that they are being treated fairly,

their motivation and job satisfaction tend to increase. Conversely, perceived inequities can lead

to dissatisfaction and demotivation.

Maslow's Hierarchy of Needs (2013) is another influential theory linking motivation to employee

satisfaction. According to Maslow, individuals have a hierarchy of needs, beginning with basic

physiological needs and progressing through safety, social, esteem, and self-actualization needs.

When these needs are met in the workplace—such as through fair wages, job security, positive

relationships, and opportunities for personal growth—employees are more likely to feel satisfied

and motivated to perform at their best. Akinyele (2021) also highlights the importance of

aligning motivational practices with employees' needs and expectations. Akinyele's research

shows that customized motivational strategies, tailored to individual employees' preferences and

career goals, are more effective in enhancing job satisfaction than one-size-fits-all approaches.

This study underscores the need for banks to understand and address the diverse motivational

needs of their employees to improve satisfaction.

The relationship between motivation and employee satisfaction is also reflected in goal-setting

theory. Locke and Latham (1990) argue that setting specific and challenging goals can motivate

employees by providing a clear sense of direction and purpose. When employees achieve their

goals, they experience a sense of accomplishment, which contributes to greater job satisfaction.

The alignment of personal and organizational goals is crucial in maintaining both motivation and

satisfaction.
Workplace recognition and rewards are powerful motivators that enhance employee satisfaction.

According to Armstrong (2020), recognition for achievements, whether formal or informal,

fosters a positive work environment where employees feel valued. This recognition contributes

to their overall job satisfaction and motivates them to continue performing well. Positive

reinforcement through recognition creates a cycle of motivation and satisfaction, benefiting both

the employee and the organization.

The impact of motivation on employee satisfaction can also be understood through McGregor’s

Theory X and Theory Y (2010). Theory X assumes that employees are inherently lazy and

require constant supervision and control, which can lead to low job satisfaction. In contrast,

Theory Y assumes that employees are self-motivated and seek fulfillment through their work.

Organizations that embrace Theory Y principles, by providing autonomy, opportunities for

growth, and meaningful work, are more likely to foster employee satisfaction.

The job characteristics model, developed by Hackman and Oldham (2016), provides further

insight into the connection between motivation and satisfaction. This model suggests that jobs

with high levels of skill variety, task identity, task significance, autonomy, and feedback are

more motivating and lead to higher employee satisfaction. When employees find their work

meaningful and experience a sense of responsibility for outcomes, they are more likely to be

satisfied and motivated.

Additionally, motivation and employee satisfaction can be enhanced through effective

leadership. Transformational leaders, who inspire and motivate employees by creating a vision of

the future and encouraging personal development, can significantly impact employee

satisfaction. According to Bass and Avolio (1994), transformational leadership fosters a culture
of motivation, trust, and job satisfaction by recognizing and addressing the needs of individual

employees.

Motivation and employee satisfaction are also influenced by organizational culture. As Schein

(2010) notes, organizational culture shapes the values, beliefs, and behaviors that guide how

employees interact and perform their work. A positive organizational culture that promotes

collaboration, innovation, and recognition contributes to higher levels of motivation and

satisfaction. Employees who feel that their organization supports their personal and professional

growth are more likely to be satisfied with their jobs.

In addition, Olawale and Animasahun (2015) explore the role of training and development

programs in motivating employees in Nigerian banks. Their research finds that employees who

perceive opportunities for professional growth and development are more satisfied with their

jobs. Training programs not only improve employees' skills but also demonstrate the

organization's commitment to their career advancement, which boosts motivation and job

satisfaction.

In contrast, a study by Nwachukwu and Okafor (2020) focuses on the challenges faced by

Nigerian banks in implementing effective motivational strategies. Their research identifies

barriers such as inadequate financial resources, poor working conditions, and lack of training and

development programs. These challenges hinder the ability of banks to fully utilize motivational

strategies to enhance employee satisfaction. The study underscores the need for banks to address

these issues to improve employee motivation and satisfaction. Job stress and employee

satisfaction in Nigerian banks is another area of interest. A study by Ojo and Olufemi (2019)

examines how job stress affects motivation and satisfaction. Their findings indicate that high
levels of job stress negatively impact employee satisfaction and motivation. Employees

experiencing high stress levels are less likely to be motivated and satisfied with their jobs,

highlighting the need for banks to implement stress management strategies to improve employee

well-being.

2.3 Theoretical Review

2.1.1 Expectation Theory

The Expectancy Theory was developed in 1964 by Victor H. Vroom. Expectancy theory argues

that the strength of a tendency to act in a certain way depends on the power of an expectation

that the act will be followed by a given outcome and on the attractiveness of the outcome to the

individual (Vroom,1964). Here, attractiveness is the importance that the individual places on the

potential outcome that can be achieved on the job. This theory posits that individuals such as

employees will often tend to act or perform to given extent on the basis of the expectation that,

that act has a given pleasant outcome that will follow. Three variables are often linked to the

expectancy theory. First, there is the effort performance linkage to expectance which entails the

probability individuals perceive in line with the notion that when they exert a given level of

effort, they will eventually perform as expected. Second, there is the linkage between

performance rewards and instrumentality (Robbins et al., 2013). This linkage or relationship

focuses on the belief that individuals eventually attain the desired outcome when they perform at

a given level. Third, there is the relationship between valence and attractiveness. This stipulates

the importance placed by individuals on the rewards that a given job is likely to afford them.

The expectancy theory works in several ways, first, the strength or level of an individual’s

motivation towards performing a given task directly correlates with the level of believing that the
individual has the capability to realize goals set for him/her. Second, the employee on the basis

of instrumentality notion has to believe that after achieving the given goal, he or she will be

adequately rewarded by the requisite departments or organization (Robbins et al., 2013). Third,

based on valence or attractiveness notion, the individual has to believe that the stated reward will

eventually satisfy individual goals. The key issues concerning valence is that the right criteria

should be employed in judging employees' performance in achieving the desired outcomes. In

addition, the employees’ personal review on the chances they have towards achieving the desired

goals is very important. Employees should view themselves as capable of, or having a high

probability of achieving or successfully attaining the desired levels of performance.

2.1.2 Equity Theory

Equity Theory was developed by J. Stacey Adams in 1963and is primarily based on employees’

comparisons with others. The equity theory claims that in most cases, employees do compare the

reward a given job situation gives them in relation to their input in the job, comparing the input-

outcome ratios of other employees relevant to their job type and level. It thus becomes

imperative to understand how employees perceive their input-outcome ratios when deciding on

the plausible ways to motivate or reward those (Robbins et al., 1963). A state of equity will

always exist when employees perceive that their input-output ration is equal to those of other

employees relevant to their levels. This does not present issues when it comes to rewarding the

employees. However, whenever employees perceive that there is a given level ofinequity in

input- outcome ratio, there are several actions they likely will take including, distorting their own

inputs or outcomes or those of others. It is highly likely that when employees realize they are

over-rewarded or under-rewarded they will behave in a way that will eventually induce other

employees to change their input-outcome ratios.

In situation where employees perceive they are over-rewarded, they will be motivated and thus

will put more effort in their work (Robbins et al., 2013). Eventually, these employees might act

in ways that other employees will perceive they are under-rewarded which may result in tension

or a reduction in the other employees’ performance. In situations that employees feel under-

rewarded, they might employ less effort in their work resulting in reduced levels of production

while in cases where employees perceive they are over-rewarded, they feel more motivated to

work harder (Robbins et al., 2013). Additionally, under-rewarded employees may decide to quit

their jobs or the over-rewarded employees cause other employees to quit their jobs. Moreover,

the equity theory has its own inherent problems. This theory leaves several core issues unclear.

Such issues include how employees define their inputs and outcomes as well as those of others.

Another key issue left unclear by this theory is how employees combine outcomes and inputs as

well as weigh them to come up or arrive at totals (Robbins et al., 2013). Moreover, the theory

does not explain how these factors change over time. Despite the limitations of the equity theory,

it rides on an impressive research support, offering crucial insights into employee reward

systems.

2.1.3 Maslow’s Hierarchy of Needs Theory

In motivation and reward theories, Maslow’s Hierarchy of Needs Theory is the best-known cited

theory. Abraham Maslow proposed this theory in 1943. In this theory,Maslow claims that for

every human being, a hierarchy of five needs exists (Maslow, 2013). These five need categories

include lower order and higher order needs. The lower order needs are physiological needs and

safety needs. On the other hand, higher order needs include the social needs, self-actualization

needs, and esteem needs. In the context of rewards, needs entails internal states that make certain

outcomes appear attractive? For example, money in Maslow’s theory would essentially satisfy
lower needs and motivate employees to work harder aiming at higher needs. In most cases,

employees fight for money as a security need, provision of clothing, food, and shelter while on

the other hand, money could act as a self- esteem need capable of giving the individual a sense of

self-worth.

It is instructive for managers to understand that as each of the employee’s need is substantially

satisfied, another need becomes dominant. Therefore, at no time will every need be fully

gratified as well as no substantially satisfied need motivates (Maslow, 2013). In motivating

employees, it is highly recommended that the manager understands the employee’s position in

the hierarchy and focusing on rewarding the employees by satisfying needs at that level or a level

immediately above the employee’s level. This theory has an intuitive logic as well as it is easy to

understand. Despite its intuitive logic, this theory is rarely validated by research since it lacks

empirical substantiation (Maslow, 2013).

2.4 Empirical Review

Several empirical studies have investigated the impact of reward systems, including total

rewards, on employee performance across different sectors. Riaz (2014) explored the effect of

total rewards on employee performance and organizational commitment, using SPSS as a

statistical tool. The study concluded that total rewards, such as incentives and salaries, play a

significant role in increasing employee motivation in Local Revenue Management.

Similarly, Ramzan, Hafiz, Zubair, Ali, and Arslan (2014) examined the impact of remuneration

on employee performance within the banking sector of Pakistan. Their findings revealed a

significant relationship between remuneration and employee performance, with the use of SPSS

and ANOVA indicating that remuneration and awards have a notable influence on performance.
Mukulu et al. (2014) investigated how reward and total reward policies affect the performance of

Kenyan commercial banks. They argued that strategic success in organizations largely depends

on human resources, highlighting the critical role of rewards in enhancing organizational

performance.

Staphen’s study focused on job satisfaction and employee motivation, specifically within the

context of performance appraisals. He suggested that employee motivation is strongly influenced

by confidence in the appraisal system. Yasmeen et al. (2013) conducted empirical research on

the effect of rewards on organizational performance in the Pakistan Telecom sector. Their

findings indicated that appreciation and recognition are key factors driving organizational

performance, with a modest link between total rewards, bonuses, and performance. The study

concluded that employees are more motivated by intrinsic rewards compared to extrinsic ones.

Nazir and Khan (2013) explored organizational engagement and job satisfaction in the UK

Higher Education sector. Their research found that the system of rewards, both cash and non-

cash, positively influenced employee competence and engagement. The study emphasized that

recognizing employees as social agents contributed to higher levels of organizational

commitment.

Nguithomaskatuaat (2014) investigated the banking sector in Kenya, revealing that employee

performance is significantly influenced by reward structures. Using SPSS and MS Excel, the

study found that rewards and total reward structures have a strong impact on employee

motivation and performance in Kenyan banks.

Adewale et al. (2014) examined the effect of remuneration systems on employee job

performance in private institutions in Ogun State, Nigeria. Their findings revealed that
institutions with favorable pay scales experience improved employee performance, reduced

turnover, and greater employee commitment to their tasks.

Ellis (2011) studied total reward management as a tool for improving organizational performance

in the public sector, specifically within the Anambra State Civil Service in Nigeria. The research

concluded that the reform programs in the state had not significantly impacted financial reward

policies in the civil service, suggesting a need for further reforms.

Riaz (2014), using SPSS, studied the impact of total rewards on organizational commitment and

employee performance. He concluded that financial rewards, such as salaries and incentives,

play a pivotal role in motivating employees, particularly in local revenue management. Similarly,

Ramzan et al. (2014), in their research on the banking sector of Pakistan, demonstrated a

significant relationship between remuneration and employee performance, using statistical tools

like SPSS and ANOVA to show that performance is closely linked to how rewards are

structured.

In Kenya, Mukulu et al. (2014) focused on how reward policies influenced the performance of

commercial banks. Their study showed that strategic success in companies is largely dependent

on how well human resources are rewarded, with rewards boosting motivation and driving

performance. Staphen’s empirical study on performance appraisal further highlighted that job

satisfaction is often tied to employees' trust in the fairness and effectiveness of appraisal systems.

Yasmeen et al. (2013) conducted a case study in Pakistan's telecom sector, revealing that

intrinsic rewards like appreciation and recognition had a greater impact on organizational

performance than extrinsic rewards like bonuses. This suggests that while financial rewards are

important, non-financial rewards can play a more crucial role in motivating employees.
Further research by Nazir and Khan (2013) in the UK higher education sector found that non-

cash rewards, such as recognition, play a key role in enhancing job satisfaction and

organizational commitment. This aligns with findings by Nguithomaskatuaat (2014), who noted

that banks in Kenya showed a strong link between rewards and employee performance,

particularly when using both financial and non-financial incentives.

Adewale et al. (2014), focusing on private institutions in Nigeria, discovered that appropriate

remuneration systems directly influenced employee performance, reducing turnover and

enhancing commitment. Ellis (2011) examined public sector organizations, concluding that while

financial rewards are essential, non-financial rewards, such as career advancement opportunities,

also play a critical role in motivating employees.

Christen and Lyer (2005) underscored the importance of effort in achieving job performance and

satisfaction. They argued that employee performance is tied to the perceived fairness and

adequacy of the rewards system, where both financial and non-financial rewards should be

balanced to sustain motivation and productivity.

2.5 Review Summary/Knowledge Gap

The literature review has provided comprehensive insights into various aspects of reward

management and its impact on employee performance, particularly within the context of the

Nigerian commercial banking sector. Key themes explored include the role of financial and non-

financial rewards in enhancing employee motivation, job satisfaction, and organizational

commitment. Theories such as Equity Theory and empirical findings from recent studies were

discussed, highlighting the importance of a balanced reward system that includes both monetary

incentives and recognition of employee contributions.

2.5.1 Review Summary

1. Impact of Financial Rewards: Financial rewards such as bonuses, salaries, and

incentives have been consistently shown to have a positive impact on employee

performance. They directly link the reward to the performance outcomes, motivating

employees to achieve higher levels of productivity. However, the review indicates that

the over-reliance on financial rewards can overshadow the importance of non-financial

rewards, which are equally crucial for long-term motivation and job satisfaction.

2. Role of Non-Financial Rewards: Non-financial rewards, including recognition, career

development opportunities, and supportive work environments, play a significant role in

enhancing employee motivation and satisfaction. The review suggests that when

employees feel valued and recognized for their contributions, their commitment to the

organization increases, leading to improved performance.

3. Challenges in the Nigerian Banking Sector: In the Nigerian commercial banking

sector, there are significant challenges related to the implementation of effective reward

management systems. The review highlights issues such as employee dissatisfaction, high

turnover rates, and the lack of clear career development paths, which are prevalent in

many banks. These challenges point to potential gaps in the current reward structures that

need to be addressed to improve employee performance and retention.

4. Cultural and Economic Influences: The review also points to the influence of cultural

values and economic factors on reward management practices. In South East Nigeria,

cultural dimensions such as collectivism and power distance impact how employees
 perceive rewards. Additionally, economic challenges such as inflation and currency

fluctuations affect the effectiveness of financial rewards.

2.5.2 Knowledge Gaps

Despite the extensive research on reward management, several knowledge gaps exist,

particularly within the context of the Nigerian commercial banking sector:

1. Limited Empirical Research in South East Nigeria: While there is considerable

research on reward management in general, there is a lack of empirical studies focused

specifically on the South East Nigerian banking sector. This gap is significant given the

unique cultural and economic factors that influence reward management practices in this

region.

2. Integration of Financial and Non-Financial Rewards: There is a need for more

research on how financial and non-financial rewards can be effectively integrated to

create a holistic reward management system. Existing studies tend to focus on one aspect,

either financial or non-financial, without adequately exploring how these rewards can

complement each other to enhance employee performance.

3. Longitudinal Studies on Reward Impact: Most studies in the literature review focus on

short-term effects of rewards on employee performance. There is a gap in longitudinal

research that examines the long-term impact of reward management practices on

employee motivation, satisfaction, and retention in the banking sector.

4. Impact of Technological Advancements: The review highlighted the influence of

technological advancements on employee roles and reward in the banking sector.

 However, there is limited research on how reward management systems need to adapt to

these changes, particularly in relation to digital banking and automation.

Addressing these knowledge gaps through further research will provide a deeper understanding

of effective reward management practices in the South East Nigerian commercial banking sector

and their impact on employee performance.