This study attempted to investigate the effects of a compensation system on organizational effectiveness and to determine if Psychological Ownership mediates the relationship between the two variables through empirical analysis. For this, a questionna...
This study attempted to investigate the effects of a compensation system on organizational effectiveness and to determine if Psychological Ownership mediates the relationship between the two variables through empirical analysis. For this, a questionnaire survey was conducted on a total of 315 employees working in Hair Beauty Shop which has over 5 employees in Seoul, Incheon and Gyeonggi over one year. The survey results found that compensation system had a positive effect on organizational effectiveness and Psychological Ownership, and Psychological Ownership also had a positive effect on organizational effectiveness. In addition, the empirical analysis found that compensation system and Psychological Ownership are important variables for the effects of organizational effectiveness, and Psychological Ownership plays a mediating role between compensation system and organizational effectiveness. The study results revealed the following: The Hair Beauty Shop should realize and motivate Psychological Ownership to make organizational effectiveness Compensation system should include organizational vision and goal, and improve in rationality. Also, Hair Beauty Shop should improve organizational culture for employees to motivate Psychological Ownership. Lastly, limitations and future work are discussed.