Rewards and Organizational Performance in Japan and the United States: A Comparison

Abstract

The effectiveness of reward practices in a variety of national cultures is not often studied. Based on an earlier study of reward practices and performance in the United States, this article extends that research to compare U.S. reward practices’ effectiveness with the effectiveness of practices in Japanese organizations. The findings suggest that although some reward practices may be universally effective regardless of national culture, others appear to be effective based on a fit with the prevailing national cultural norms. It is important for managers and human resource professionals to carefully consider national cultural values when designing a rewards system to fit their organizations. Some reward practices may be universally effective regardless of culture; others may be culturally sensitive.