Firms with the edge in attracting, retaining, motivating, and rewarding top technical people have the edge in industries in which science and technology are at the core of value added activity (Boutellier et al., 2000, Floricel and Miller, 2003, Medcof, 2001, Niosi, 1999 and Serapio and Hayashi, 2004). Such firms grapple daily with global competition and rapid technological change so the cornerstone of competitive success is people who can innovate.
Human resource management practice is rising to these challenges in high technology and other sectors and continues to have a demonstrated effect upon firm performance (e.g. Becker et al., 1997, Bowen and Ostroff, 2004, Chang and Chen, 2002, Diaz and Gomez-Mejia, 1997 and Huselid et al., 1997). That effectiveness has been engendered by constant innovation in human resource management itself, including, but not limited to, keeping abreast with ebusiness (Huselid, 2004) and corporate governance issues (Beatty, Ewing, & Tharp, 2003), developing supra-organizational systems for best practice (Medcof & Needham, 1998) and evolving its various subfields (Ruona & Gibson, 2004). Reward systems continue to be an important facet of human resource management and, perhaps, the cornerstone of human resource management strategy (e.g., Beer et al., 2004, Boyd and Salamin, 2001 and Montemayor, 1996). Reward systems should be an important part of human resource strategy for high technology workers.
High technology workers present unique challenges when it comes to rewards, partly because of their own unique nature and partly because of the unique context in which they work. For example, Diaz and Gomez-Mejia (1997) found the most frequently cited distinguishing characteristics of R&D workers to be their strong achievement orientation, drive to succeed, willingness to take risks, tolerance for ambiguity, relatively weak allegiance to the employer and their high identification with the profession. Harpaz and Meshoulam's (2004) literature review found high technology contexts to be less unionized, more results orientated, more oriented towards merit in promotion decisions, more informal, more dynamic and uncertain, more flexible, flat and differentiated in organizational structure, and inclusive of more complex and changing jobs. There is a continuing need for empirical research, conceptual development and innovative practice in the rewarding of this distinct category of workers in their distinct set of organizational circumstances. This paper will focus primarily upon the workers themselves, their reward preferences, and the rewards arrangements that work best for them. However, some literature on rewards in high technology firms is highly relevant to that focus and that literature will be called upon at certain points in the review.
Total Rewards is an approach which has received considerable attention in the human resources management practice literature in recent years (Fischer et al., 2003, Gross and Friedman, 2004, Kantor and Kao, 2004, Lyons and Ben-Ora, 2002, O'Malley and Dolmat-Connell, 2003, O'Neal, 1998, Petruniak and Saulnier, 2003, Pfau and Kay, 2002, Platt, 2000, Poster and Scannella, 2001, Thanasse, 2003, Watson, 2003 and Zingheim and Schuster, 2001). Total Rewards is a new departure because it conceives of rewards as consisting of everything that employees value in the employment relationship. It includes the obvious, traditional financial rewards such as salary, incentive pay, stock options and benefits. But, in addition, it also includes non-financial rewards which are often not thought of as rewards, such as training opportunities, challenging work, and work arrangements that support effective work/life integration. Total Rewards has some promise for the management of high technology workers as shown by its application at IBM (Platt, 2000), AstraZeneca (AstraZeneca, 2004), and Ethicon (Thanasse, 2003), as well as in less technology-laden firms such as 3M (3M, 2004) and Marriott (Fischer et al., 2003). However, to date there has been no systematic consideration of Total Rewards in the high technology management context.
This paper will use a Total Rewards perspective to review the rewards literature specific to high technology workers. It will demonstrate the value of Total Rewards as an organizing framework, lay some groundwork for managers involved with Total Rewards in high technology settings, and indicate some fresh directions for future research. The first part of the paper describes Total Rewards. Second is a review of the literature on rewards for high technology workers. Third, conclusions based primarily upon the empirical research will be drawn and future research directions suggested. The need for a stronger conceptual foundation for Total Rewards will also be noted.
