KNUTSFORD UNIVERSITY

COLLEGE

Research Proposal
TOPIC: THE RELATIONSHIP BETWEEN GOOD SALARY AND EMPLOYEE
PERFORMANCE IN GHANA

ENE UMO EFFIONG (KBS0406)

1.0. INTRODUCTION

1.1. Background to study

In any company or organization, it is important to generate and maintain an effective reward

system that would cater to the needs of its human resources. The reward system offered in

different companies may come in various and concrete forms. These may either be monetary

or non-monetary, tangible or intangible, and physical or psychological, and these are offered

to the employees as compensation for the productive work they execute (Caruth &

Handlogten, 2001).

Furthermore, a formalized corporate reward system is necessary because it would appeal to

capable and skilled people to fill the available positions in a specific organization.

Additionally, such method would promote acceptable levels of turnovers because the present

human resources would be encouraged to stay in the organization. Lastly, an efficient reward

system would also motivate the workers to perform their responsibilities to the fullest degree

of their personal capacities (Caruth & Handlogten, 2001).

Traditionally it is believed that employees are motivated by the opportunity to make as much

money as possible and will act rationally to maximize their earnings. The assumption is that

money, because what it can buy is the most important motivator of all people. If this is so,

why do some employees oppose the introduction of piece rate plans and others refuse to take

overtime. Obviously in place of the above monistic approach (men is motivated by money

alone) a pluralistic explanation is required. According to the pluralistic approach men work to

fulfill variety of needs. Three types forces generally influence human behavior: (1) Forces

operating within the individual (2) forces operating within the organization and (3) forces

operating in the environment.

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To the individual, human needs are both numerous and complex. Some these needs cannot be

described and identified because people hide their real needs under the cover of socially

accepted behavior. Further, each person is different and variety of items may prove to be

motivating depending upon the needs of the individual, the situation the individual is in and

what rewards the individual expects for the work done. It is the duty of the manager to match

individual needs and expectations to the type of rewards available in the job setting.

The climate in the organization must conducive to human performance. Climate plays an

important part in determining worker’s motivation. The climate in an organization is

determined by a number of variables such as its leadership styles, autonomy, enjoyed by

member’s growth prospects emotional support from members reward structure etc.

A worker does not live in two separate worlds, one inside the factory and the other outside it.

The troubles and pleasures of off the job life cannot be put aside when reporting for work in

the morning nor can factory matters be dropped when returning home after work. On the job

experiences an off the job experiences are inextricably interwoven and cannot be separated to

water tight compartments. Culture, norms, customs, images and attributes accorded by

society to particular jobs, professionals and occupation and the worker’s home life – all play

a strong motivation role. An individual may prefer to do the job of an officer (because it has

social status and gives lot of power) rather than serve as a college teacher (powerless

position). In other words factor such as social status and social acceptance play an important

role in shaping the motivations of people.

Many managers hold the opinion that, paying good salaries to employees would

automatically lead to performance. However, the historical antecedents of the Ghanaian

economy have proved that is not necessarily the case. The researcher therefore seeks to

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establish the relationship between a good salary and performance. Throughout the study, the

researcher would want to answer the question “Does a good salary lead to Performance”.

1.2. Statement of the Problem

The Ghanaian economy has witnessed massive influx of various rewards and compensation

systems aimed at motivating employees to put up their best. Over the past few years, the

country has witnessed close to a 100% increase in the minimum wage. The country has also

witnessed the introduction of the Single Spine Salary Structure (SSSS) aimed equal work for

equal pay. Most of the labour unrest witnessed in the country over the past three years has

been on salaries. Despite all these, the average Ghanaian worker is said to be under-

motivated. The researchers therefore seek to establish the relationship between a good salary

and employee performance in Ghana.

1.3. Research Objectives

This study, in general, seeks to establish the relationship between good salary and

performance, specifically, the researcher seeks:

1. To identify what employees considers and good salary.

2. To identify what employers consider as performance.

3. Establish the relationship between good salaries and performance.

1.4. Research Question and Hypothesis

The key variables in this study are good salaries and performance, with good salaries being

the independent variable and performance being the dependent variable. In line with this, the

researcher, in conducting, the study would attempt the answer the following questions;

1. What, to the employee, constituted good salary?

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 2. What, to the employer constitutes performance?

3. What is the relationship between a good salary and performance?

In my view, I do not accept the concept that a good salaries leads to performance. But rather

that a good salary together with an effective supervision and performance appraisal systems

would lead to performance.

The following hypotheses have therefore been developed to be the basis for the research;

1. Good salary is directly related to performance.

2. There is no relationship between a good salary and performance.

Because, I. the researcher is interested in the identifying the relationship between a good

salary and performance, I have decided to drop hypothesis 2 (null hypothesis) and

concentrate on hypothesis 1 (alternate hypothesis)

1.5. Significance of study

The focus of this research is on the relationship between a good salary and performance
which makes it important to individuals, managers, and corporate entities. Aside adding to
the knowledge already available in the area of the study, the research is also aimed at
providing an in-depth discussion on the subject and by-so-doing enrich the knowledge of
individuals in this field of study.

It will be a must read for up and coming managers who wants to understand the how good
salaries influence performance. The research is also to establish if there are potential areas
that managers can also work on to help improve the performance of employees.

1.6. Definition of Terms

Good salary: The net pay that an employee takes home at the end of the day. This in this

refers to high pay.

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Performance: Refers to work performance in terms of quantity and quality expected from

each employee.

Likert Scale: the measuring technique where the degree of agreement or disagreement is

given a numerical value ranging from one to five, thus a total numerical value can be

calculated from all the responses.

SPSS: Statistical Package for the Social Sciences.

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CHAPTER TWO

2.0. LITERATURE REVIEW

The term motivation has both psychological and managerial connotation. The psychological

meaning of behaviour refers to the internal mental state of a person that relates to the

initiation, direction, persistence, intensity and termination of behaviour. The managerial

meaning of motivation deals with the activity of managers and leaders to induce others in

order to produce results desired or outlined by the organization or by the manager. The

managerial concept of motivation conforms to a relationship between motivation, ability and

performance. The main purpose of motivating your workplace is to minimize dissatisfaction

and to keep people within the organization. There are so many factors that an individual

employee may be motivated. Examples of this are technical supervision, interpersonal

relations, salary, working conditions, status, company policy and job security (Tosi et al,

2000, pp. 129-133).

Further, reward systems, most especially, are the considered as forerunners of employee

motivation (Caruth and Handlogten, 2001, p1). Since the people and their knowledge, skills

and abilities are the most important driving force to the success of any organization,

continuing commitment and support to them could be realized through looking for effective

ways to reward their contributions, loyalty, dedication and efforts.

Reward systems, for instance, must be created in such a way that employees will be

compensated to enhance motivation, growth and productivity while also encouraging them to

align their efforts with the company's objectives, philosophies, culture and values. Reward

and punishment is composed of direct and indirect monetary incentives. The latter consists of

pay and rewards received by employees in the form of wages and salaries, incentives,

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bonuses and commissions whereas the former comprises of the benefits supplied by the

employers. According to Sims (2002), these non-financial compensations include employee

recognition programs, rewarding jobs and flexible work hours to accommodate personal

needs.

An ideology is that commitment and motivation are an outgrowth from organizational

behaviour that place emphasis on management strategy connecting human resource

management with organizational behaviour and management strategy (Guest, 1987). An

incremental function of human resource management is central on the emergence of better

educated workforces and higher individual expectations.

Employees would be motivated to perform even more through more incentive. Eventually,

employee turnover rates would be lessened and positive reinforcement would lead to higher

job satisfaction. The drive is to provide challenging and interesting work, recognitions and

rewards for accomplishments and provide an opportunity for fast career growth and

advancement. At the individual attitudes/behaviour level of the best fit model, and in schemes

of total human development, an effective management is characterized by the promotion of

attitudes that value contribution and performance.

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CHAPTER THREE

3.0. Methodology

3.1.1. Research design and Methodology

The research would be purely a basic research with the aim of adding on to knowledge in the

field of study. The research which would be both a descriptive and explanatory in nature, in

order to complete the purpose and objectives of the study, the quantitative research approach

will be applied through the conceptualization and implementation of a survey

method. According to Mays and Pope (2000), the quantitative research approach is most

appropriate when conducting descriptive and exploratory study in order to quantify data that

seem immeasurable, such as motivation. This permits a flexible and iterative approach of

analyzing and statistically manipulating the collected information. Descriptive and

exploratory approaches served as guidelines in logically and comprehensively presentation of

the results of the study. Furthermore, cross-sectional studies often employ the survey strategy

describing the incidence of a phenomenon and comparing variables at the time of the study

(Saunders et al, 2003).

Surveys are conducted to gather data from the field in order to generalize results from a
sample to a larger population (Commonwealth of Learning, 2000). The primary purpose and

advantage of surveys is generalization of the results (Commonwealth of Learning, 2000).

Usually, surveys are interested in gathering data from many than in obtaining intensive,

detailed information from a few individuals; therefore, it is seldom for a survey to consist of

one or very few individuals (Commonwealth of Learning, 2000). In this light, the survey

method will be used for data collection.

A self-administered structured questionnaire, or the type of questionnaire that is usually

completed by respondents (Saunders et al, 2003) will be utilized in the study. This

questionnaire has two sections: the first part is intended to acquire the demographic profile of

the respondents while the second section comprises the set of attitude statements that will

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determine the level of agreement or disagreement of the respondents using a five-point Likert

scale. In the Likert technique, the degree of agreement or disagreement is given a numerical

value ranging from one to five, thus a total numerical value can be calculated from all the

responses (Underwood, 2004). In this regard, the responses to questions will be analyzed by

determining their corresponding frequency, percentage and weighted mean.

As such, the stratified non-random sampling technique will be utilized to ensure the

representativeness of the respondents in the survey method. This particular sampling

technique ensures the validity and reliability of the data based on the number or quantity of

the respondents who filled out the survey questionnaires. Stratified non-random sampling

technique operates by classifying the target population into group classifications as set by the

researcher. The samples are chosen through several selection procedures that usually take

several stages depending on the complexity of the characteristics of the possible respondents

and the interest of the researcher (Trochim, 2001). 

This study would also employ qualitative research method, since this research intends to the

relationship between higher salary and Performance through qualitative elements in research.

These qualitative elements does not have standard measures, rather they are behavior,

attitudes, opinions, and beliefs.

Furthermore, as we define the qualitative research it is multi-method in focus, involving an

interpretative, naturalistic approach to its subject matter (Creswell, 1994). This means that

qualitative researchers study things in their natural settings, attempting to make sense of, or

interpret phenomena in terms of the meanings people bring to them. Accordingly, qualitative

researchers deploy a wide range of interconnected methods, hoping always to get a better fix

on the subject matter at hand.

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3.2. Data Analysis
All of the data will be evaluated with the use of SPSS software. Thus, in order to come up

with the results and findings of the study, frequency, percentage and weighted mean will be

calculated. I would also make use of simple correlation to establish the relationship between

the various variables of interest.

3.3. Scope of the study

I would restrict my research to employees and managers located in both private and private
companies in Accra. This decision to limit the study you is due to time and monetary
constraints. In all, 150 participants would partake in the research drawn from both the private
and public sector.

3.4. Organization of the study

The research would be organized as follows;

Chapter One would look at the topic phraseology, the introduction-which comprises of the

background of the study, definition of the problem, objectives and rationale for the study-,

research hypothesis, and definitions of terms. Chapter Two looks at a literature review of the

theoretical perspectives of the subject matter. Chapter Three look the research design and the

methodology to be used in the collection of data and the analysis of collected data. Chapter

Four would cover results and a discussion of the results and a summary of findings. The last

chapter, Chapter Five would cover conclusion and implications of the research.

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 REFERENCES:

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James Short (eds.), Annual Review of Sociology, 10: 37-69. Palo Alto, CA: Annual

Reviews.

2. Baron, J.N., & Cook, K.S. (2002). "Process and outcome: Perspectives on the distribution

of rewards in organizations." Administrative Science Quarterly, 37: 191-197.

3. Caruth, D., & Handlogten, G. (2001). Managing Compensation (And Understanding It

Too): A Handbook for the Perplexed. Westport: Quorum.

4. Creswell, J.W. (1994). Research design. Qualitative and quantitative

approaches. Thousand Oaks, California: Sage.

5. Finkelstein, S. & Hambrick, D.C. (2001). "Chief executive compensation: A synthesis

and reconciliation." Strategic Management Journal, 9: 543-558.

6. O'Reilly, C.A. III, Main, B.G. & Crystal, G.S. (2001). "CEO Compensation as

Tournament and Social Comparison: A Tale of Two Theories." Administrative Science

Quarterly 33.

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