Impact of Work Environment, Salary Package and Employees’ Perception on Organizational Commitment: A study of Small & Medium Enterprises (SMEs) of Pakistan

The chief purpose of this research paper is to investigate how factors like (1) work environment; (2) salary Package and (3) Employees’ perception have an effect on the employees’ organizational commitment in the Small and Medium Enterprises (SMEs) of Pakistan. A survey based Questionnaire is used to collect the data from the employees of Pakistani SMEs, particularly from the city Islamabad. Data is collected from 380 out of 500 respondents and is analyzed statistically. For hypothesis testing (T-test), for model fitness R-Square Value, for relationship between the variables Pearson’s correlation and cronbach Alpha for the reliability of data were used. The findings of the study indicate that favorable work environment has a significant positive relation with the organizational commitment, good salary packages increases the organizational commitment of the employees, and employees good’ perception about the organization is also positively related to the organizational commitment of the employees. This means that if the organizations provide good work environment to their employees, it will lead to the increased commitment of the employees to their organization. Secondly if the salary packages of the organization are competitive/good the employees will show commitment to their organization and will continue to work there. Thirdly if the employees hold good perception about the organization they will be more committed to the organization. The limitation of the study can be that the data is collected from Islamabad city only, which might result predicting the region based SMEs of Pakistan. Through this study, the importance and factor affecting the organizational commitment has been recognized for the SMEs of Pakistan, which will be helpful for the policy making and HR practices of SMEs in Pakistan.