Motivational Theories (Fynn)

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Motivational Theories (Fynn)

Haupt Topic

Financial Rewards(Samuel)

Wages (piece rate)

Disadvantages

• Added pressure

• Provides little security over pay level

Quantity versus quality

• Increase motivation; Extra productivity

helps set a price for the product

• The labour cost of each unit is determined in advance and

• Employees have an incentive to work hard

performance-related pay (PRP)

1.Unrealistic targets; Pressure can cause stress 2. Not appropriate for all sectors (quality over quantity) 3. May not encourage team work 4. Non-financial motivators are ignored

1.Creates incentives for people to work better 2.Fair system (Adams) 3.Helps to develop a performance culture

employee share ownership schemes; fringe payments (perks)

Tends to be used to reward those in the senior management team

Promotes lower rates of absenteeism and staff turnover

1.Promotes employee loyalty and team spirit 2.Managers and employees work together to achieve higher levels of profit

profit-related pay

1,Often too small 2.Individual efforts are not recognized

commission

1.Speedy production/service vs. quality 2.Added pressure to workers to sell more 3.Repetitive and monotonous tasks 4.Difficult to meet security needs 5.Need to hire more quality controllers

1.Still earn a basic salary 2.Overcomes problems of time-based systems, such as wages

Salary

1.Difficult to reward those who are more productive 2. No incentive to work hard (may encourage slack or procrastination. 3.Performance appraisal may be needed

Advantage

1. Gives security of income 2.Aids in costing 3.Where output or productivity is not easy to measure

wages (time)

Disadvantage

1.Workers are not rewarded for their efforts but their time 2.May encourage laziness and poor productivity 3.National minimum wage

Advantages

Straight-forward method