Role of Money as a Motivator

Employee expectations are also critical influencing the reward structure. Meeting employee’s expectations is important to generate a motivated work force. The employee’s need and

A Performance-Based Pay system is an increasingly popular compensation method used by organizations to increase productivity. A goal for all companies is to try and remain competitive and control costs, this is a reason for performance-based pay systems becoming more popular. This type of system attempts to link compensation to performance. (Gena Richter, 2002) These systems are directly tied to organization or individual performance and are most effective when based on objective measures of quantity or quality of performance. If we wish to have a direct impact on work motivation, it must be linked directly to the performance of desired behaviors. In order for to put this type of system into place, performance evaluations must be conducted regularly , as well as training and development for those with performance that isn't quite up to par. These additional resources will be necessary for our organization if we implement a performance based pay system. (William B. Bernathy, Ph. D., 2004)

A well-articulated compensation philosophy drives organizational success by aligning pay and other rewards with business strategy. It provides the foundation for plan design and administration and anchors current and future plans to the company's culture and values (Kaplan, 2006, p.32). Recognizing and rewarding achievement is the cornerstone of the company A’s compensation philosophy. The mission of the company is to attract, select, place and promote all individuals based on their qualifications. The company believes that performance-based compensation helps attract, develop and retain talented professionals. In addition to base pay which based upon local market conditions and targeted to be above market, the company provides the following types of potential compensation to reward performance:

Employees are motivated by both intrinsic and extrinsic rewards. In order for the reward system to be effective, it must encompass both sources of motivation. Studies have found that among employees surveyed, money was not the most important motivator, and in some instances managers have found money to have a de-motivating or negative effect on employees.  This research paper addresses the definition of rewards in the work environment context, the importance of rewarding employees for their job performance, motivators to employee performance such as extrinsic and intrinsic rewards, Herzberg’s two-factor theory in relation to rewarding employees, Hackman and Oldman model of job enrichment that

Pay and Rewards – pay and rewards attract, motivate and retain staff. The employment contract which lists rewards, whether it be pay, bonus or benefits, can remove animosity amongst employees and employers. However, recent research reveals that employees are no longer motivated by a financial reward alone, but

SALARY: compensation is clearly an important factor for employees and it is one of the main reason for them moving to a new job. Successful professionals appreciate generous salary because giving them a high compensation the company shows to recognize properly and appreciate their skills and competencies.

Motivation is the force that makes us do things, whether accomplishing personal goals or completing tasks at work. Most people are motivated as a result of their individual needs being satisfied, which gives them the inspiration to perform specific behaviors for which they receive rewards (Kinicki & Williams, 2011). These needs vary from person to person, as everybody has specific needs to be satisfied. When we consider factors that determine the motivation of employees, many of us think of a high salary. This answer is correct for the reason that some employees will be motivated by money, but mostly wrong for the reason that it does not satisfy other needs to a lasting degree (Bizhelp24, 2010). This supports the idea that human

Performance management depends on good systems that offer both financial and non-financial rewards. Reward within a performance management system ensures that:

The system allows organizations to create results by rewarding the employees who are responsible of making them happen. By rewarding employees who are high performers and coaching low performers to improve their performance can help improve the overall productivity of the company; However, the improvement will not last long. Not every employee finds a long-term motivation by a pay increase. Some employees are motivated by being recognized by their peers, others by having the same beliefs as the company, or by simply feeling like they are making a positive difference among their community. According to Kohn (1993), “Just because too little money can irritate and demotivate does not mean that more and more money will bring about increased satisfaction, much less increased motivation” (para 15), which is why it is important to seek different strategies to motivate employees. A way companies could sustain its’ culture by having employees who have similar core values. Creating a culture where employees look forward to spending the day at their job and making a difference, instead of feeling like their job is an obligation is a goal. Placing values on employees decreases turn-over and increases employee’s satisfaction with the job. Another way that

Pay structures, regardless of the size of the organization, must have two things going for them, which are external and internal equities. In order to give employees purpose to continue to give their loyalty and retention, there must be incentives as paying for education, experience and training, job tenure, demonstrated skills, or a combination of these attributes consistently. Organizations should develop a well written compensation program which includes incentives, and addresses both external and internal equities.

There are very many factors that motivate employees to do outstanding work in their jobs. Though most of them are non-monetary factors like participative decision making, work teams, challenging jobs, goals in life or in the company, power and other factors. Most of the employees that emerge in their workplace, either in a small cubicle or a mega office have got some drive that enable them to perform in their work, but the key question is, is money is the key motivation in their workplace? In this essay both sides will be argued in order to find the answer to this (Robbins, Odendaal & Roodt, 2003).

In most organisation, money is often seen as a prime motivator for employee in the government and corporate sectors. It empowers them to perform better and contribute to the organisation objective goals and productivity, however, following the shifting of economic conditions and social values, people's desire is dramatically changing. Most employee may feel that they are affected by internal and external

Keeping employees motivated in addition to creating incentives and/or additional ways for employees to receive more compensation will create better performance overall within an organization. Contrary if company B gives their employees incentives to perform, without any motivational tactics they probably will not have as many top performances as company A, in addition the company may only seek short term rewards verses have long term success. Lack of motivation for employees within an organization, can cause long term damage for the company’s success. Different things motivate everyone; therefore there should be a system in place to keep employees motivated for the long term success of the company. In the MBM textbook under the concept of incentives, compensation, and motivation, there are a couple of different views of how it should be applied within an organization. We will discuss The Social Role of Profit, Personal Profit and Losses, and the way Market-Based Management view how incentives, compensation, and motivation should be applied and the things that effectively drive employees’ actions while at work.

An incentive pay program can reward employees who continue to produce superior work or encourage employees who already produce good work to best. Sometimes, use an incentive system when employees are lack of enthusiasm of getting down to work and improving things. If everyone in the same job classification gets the same pay, there is no real incentive to do an outstanding job (French, 1990). Various incentive plans used to motivate all employees such as production staff, sales staff, administrative staff and managerial and professional staff on an individual basis. To be improved employee work performance, the incentive pay programs need to be fairly matched with the employees’ expectation. Properly designed and maintained incentive pay program has the potential to increase employees’ productivity and work performance.

Being rewarded and recognised for their work or contribution is what keeps an employee motivated to work towards achieving the organisational as well as personal goals. When the employees is motivated by rewards, they will have job satisfaction consequently increasing the productivity of the organisation. It necessitates the need of managers to pay more attention in understanding their employees and come up with suitable types of reward systems for the organisation so that the employees are intrinsically and extrinsically motivated all the time. The hypotheses that I put forward here is to support this statement that effective reward management is critical to