The Impact Of National Culture On Compensation Preferences

This paper aims at exploring the National Culture of South Africa by taking a closer look at the certain ethnic groups inside South Africa and see how these cultural differences affect the compensation preferences of South Africans.South Africa is well known as a rainbow nation,this is so because of its diverse qualities it has when it comes to culture.In the literature review the researcher reviews different theories that try to explain different cultures and why people have different preferences.These theories include Hofstede multicultural theory.The Confucious theory highlights mostly what morals are considered right or wrong and such morals have been practiced around the world and has four major virtues of Confucianism.These virtues are all interconnected in creating a paradigm of social and moral order which are found on daily lives.To gather primary data,the researcher used closed ended questionnaire,and questionnaires were distributed using the snowballing effect to participant who worked in multi-national companies.Out of the three hundred questionnaires that where administered,only two hundred and seventy questionnaires were collected and used for data analysis.The data collected was analyzed using the SPSS and Microsoft Excel using the arithmetic mean and standard deviation.The results gathered reviewed that culture indeed plays a significant role in determining compensation packages of the employees.Each sub culture hold a different values and practices from each other.More so different subcultures in South Africa have been found to have different personal interests regarding compensation packages with some opting for individual compensation,knowledge based compensation,work life balance and even group pay.The greater part of the employees opted for individual compensation that is remuneration based on one’s skills.There were also some similarities that were found among the subcultures,like the value of family and opting for work life balance as a compensation preference.The study therefore recommended that the Multinationals should come up with certain measures which are meant to boost the motivation of the workers.Similar studies should also be taken in other countries so as to compare the findings on the area of study.