Is there more to compensation than money? The empirical study of dimensionality of the total rewards model and its implications for entrepreneurship

Objective: We aim to verify the dimensionality of the total rewards (TR) model, the idea that employees’ compensations do not consist only of money but encompass all financial and non-financial values that em- ployees received from their work.Research Design Methods: Drawing inspirations from three influential TR models and using data from a large multi-occupational online survey, we conducted exploratory factor analysis (FA) (n = 3022) to test TR dimensionality and structural equation modelling (SEM) (n = 2641) to test TR validity.Findings: The FA results revealed the two-dimensional structure of TR as best fitting to data, showing financial (tangible) and non-financial (intangible) rewards as two distinct aspects of compensation. The SEM analysis showed specific patterns of associations for each TR dimension with employee loyalty, motivation, intention to quit, and organizational performance.Implications Recommendations: The success of an entrepreneurial firm might depend not only on innova- tion in products and services but also on innovative compensation that allows for gaining competitive ad- vantages. The TR model might be used to address these challenges and build a competitive workforce by at- tracting talented employees from the labour market even under financial resources scarcity.Contribution Value Added: By showing the role of intangible rewards in compensations, our findings might inspire further entrepreneurial research and provide entrepreneurial firms with the conceptual device to de- sign compensation systems that accumulate human capital not only by money but also via intangible rewards.