Motivation in Practise

• what are financial incentives?

  money based rewards used to remunerate employees and influence their behaviour
• what are wages?

  payment for work that is usually based on time worked
• what is a salary?

  an annual figure that is paid in fixed regular intervals monthly regardless of hours worked
• piece work

  payment based on the amount output produced

  • produces more
  • quality decreases and increases costs
• commission

  a percentage payment based on sales made

  • sells more, labour costs decreased
  • stressful
• bonus

  the payment of a discretionary lump sum to an employee as a reward

  • employee feels valued
  • can distort behaviour as people will do whatever it takes to get a bonus
• profit share

  employees receive a proportion of company’s profits as part of their remuneration package

  • encourages team work
  • staff goals match the business
  • may not be fair
• performance related pay

  part of employees salary is linked to their performance

  • performance acknowledged
  • may feel it is unfair
• employee share ownership

  giving emoloyees shares or options to buy shares so they can benefit from dividends

  • goals are aligned
  • attract talented employees
  • help retain existing employees
  • less control
  • share prices can fall which is demotivating
  • only PLC and LTD
• what are non financial incentives

  methods of motivating employees through job design rather than money rewards
• consulatiation

  the process of discussing issues with employees before making decisions

  • meet belonging and esteem needs
  • may be meaningless if view is ignored
• delegation

  assigning tasks or responsibilities to a subordinate

  • meets motivators and esteem and self actualisation needs
  • staff must have skills training and experience
• empowerment

  giving subordinates decision making authority

  • meets motivators and esteem and self actualisation needs
  • staff needs trust skills training and experience
• team working

  where employees are organised into groups and work together in order to complete tasks

  • meets social needs and mayo’s belief
  • some may be limited and conflict may arise
• flexible working

  • lower level needs are met and hygienes
  • may be harder to coordinate the work forcae
• job rotation

  staff move between jobs of the same levels of complexity to alleviate boredom

  • prevents boredom
  • may not motivate in the long term
• job enlargement

  the process of increasing the number as opposed to level of responsibilities that an employee has

  • helps prevent boredom in the short term
  • will lead to boredom eventually
• job enrichment

  giving employees more challenging and interesting tasks to do

  • meets motivators and higher levels of need
  • some staff view it as a burden
• advantages of financial incentives

  • motivates workers
  • reduces the need for supervision
  • more are motivated by money
  • increases labour productivity
  • reduces labour absenteeism and labour turnover
• disadvantages of financial incentives

  • discourages a team based approach
  • challenging to measure performance
  • not all employees are motivated by money
  • costly
  • quality of work may suffer
• what should a successful job design include

  • change
  • closure
  • challenge
  • control
  • cooperation
• advantages of non financial motivators

  • improved engagement
  • improved retention
  • improved productivity
  • creates a positive working environment
• disadvantages of non financial motivators

  • takes time to implement
  • difficult to costly to run
  • some are only motivated by money