Motivational Incentives and their affects upon employee commitment
Motivational Incentives and their affects upon employee commitment within 2 marine sector businesses.
1.0 Hypothesis N0: “Motivational incentives will not increase the commitment of employees to their company”
N1 :“Motivational incentives will increase the commitment of employees to their company”
2.0 Introduction At one time, employees were considered just another input into the production of goods and services. What perhaps changed this way of thinking about employees was research, referred to as the Hawthorne Studies, conducted by Elton Mayo from 1924 to 1932 (Dickson, 1973). This study found employees are not motivated solely by money, and employee behaviour is linked to their attitudes (Dickson, 1973). The Hawthorne studies pioneered the human relations management of businesses and became a huge focus. Henry. A. Landsberger studied this concept through the experiments carried out by Elton Mayo, using light, he observed workers in higher or lower levels to see if it had an effect upon production levels. Over the years after the study various different theorists characterised their own studies and came up with very viable theories. Around the same sort of time as the Hawthorne Studies, Abraham Maslow pioneered the hierarchy of needs theory, which is taken from his paper ‘A Theory of Human Motivation’. It characterises the steps to self-actualisation using a triangular formation through physiological, safety, love/belonging and esteem. Maslow indentified these need to grow and develop until a person can achieve their individual potential. One Frederick Winslow Taylor probably put forward the first theory that workers are motivated mainly by pay. He came up with a theory of Scientific Management which argued many different points, such as; workers don’t naturally enjoy their work and need close supervision, managers should break down production into a series of small tasks, workers should be given training and tools so that can achieve a set task efficiently. Many more studies including Herzberg’s X and Y theory have being coined for use in employee motivation. These theories and previous studies are constantly referred to in many different journals of motivation.
3.0 Significance of the study The study is been carried out to analyse the commitment and work output of employees within marine sector businesses based upon various motivational incentives they are given or not given. Production levels, profit levels and service levels will be increased if an organisation motivates its employees and builds up a good relationship between their staffing and management team. Motivation can come in many different forms which will affect employees in different ways. Intrinsic motivation tends to be emotional and physical, this is when an employee is motivated by the interest or enjoyment in the task and will strive to do better because they want to know more. Extrinsic motivation is when the driving factors are external so motivation such as; money, holidays or other material possessions, this will enhance and employee’s home life and they value this more than there working environment.
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Motivational Incentives and their affects upon employee commitment
4.0 Objectives of the study Primary objective – To study the commitment of employees in relation to motivational incentives Secondary objectives -
To study the different forms of incentives in place and observe their impact on commitment
-
To identify the intrinsic and extrinsic motivation within the companies
-
To come to a valid conclusion based upon data gathered
5.0 Methodology
Choose two different businesses for which to carry out your survey Compile a number of questions relating to these 5 areas:
- Security; - Excitement and variation; - Significance (making a difference); - Connecting with others; - Growth; - Contribution.
2
Get in touch with the businesses where you are going to carry out the survey Print off about 20 surveys and ask each person within the business the questions Do the same for the second business Once all data is collected, analyse the data and make some graphs which are comparable to each other making sure that the data is not seen or handled by any third parties.
Motivational Incentives and their affects upon employee commitment
6.0 Analysis and Interpretation of data 6.1 Local Watersports Centre
6.1.1 Job Satisfaction (Statistical analysis question)
1. On a scale of 1-10 how much do you like your job (1 being not at all 10 being thoroughly enjoyable)? 1
2
3
4
5
2
6
7
8
9
2
4
4
1
9
10
number of participants
How much do you like your job? 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 1
2
3
4
5
6
7
8
1-10
Interpretation This chart shows that on a scale of 1-10, 8 people chose between 7 and 8 meaning that they like their job quite a bit.
3
10
Motivational Incentives and their affects upon employee commitment
6.1.2 Job Security How secure do you feel within your job? Not secure at all
Not very secure
Not sure
Quite secure
4
Very secure 5
3
Job security
Not secure at all Not very secure Not sure Quite secure Very secure
Interpretation This graph shows us that the majority of people, nearly 50% were quite secure with their job and 25% said very secure which favours towards the higher end of the scale.
6.1.3 Alternative position Is there a position within a company that you would rather be doing than your current job and why? Yes
No 7
4
Maybe 3
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Motivational Incentives and their affects upon employee commitment
Would you rather be doing a different job?
Yes No Maybe
Interpretation This chart shows us that regardless of people liking their job and feeling secure they would rather have a different job. This favours about 60% towards having a different position.
6.1.4 continued If No proceed to question 4 more pay better quality of work
more enjoyable
more suited your skills
1
1
1
3
Full time
other job opportunites Full time Full time
more suited your skills
more suited your skills more enjoyable
more enjoyable better quality of work
better quality of work
more pay
more pay 0
0.5
1
1.5
2
2.5
number of participants
5
3
3.5
Motivational Incentives and their affects upon employee commitment
Interpretation Of the other possible job opportunities this chart shows that most (3 out of 7) people would vouch for a job with more pay.
6.1.5 Repetitiveness or Tedium
How repetitive or tedious do you find the tasks within your job description
Very repetitive 4
Slightly repetitive
Not sure
4
Not very repetitive
Not at all repetitive
3
1
number of particpants
Repetitive or tedious work 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0
Very repetitive Slightly repetitive Not sure Not very repetitive
Very repetitive
Slightly repetitive
Not sure
Not very repetitive
Interpretation This graph shows that 70% of the participants said that there work was either very repetitive or slightly repetitive.
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Motivational Incentives and their affects upon employee commitment
6.1.6 Job Opportunities My job gives me plenty of opportunities to communicate and work alongside others
Completely disagree
Mostly disagree
Neither agree nor disagree
Completely agree
Mostly agree
4
5
Ability to communicate with others
Completely disagree Mostly disagree Neither agree nor disagree Mostly agree Completely agree
Interpretation This simple pie chart analyses the data and gives us a picture showing that 25% of people completely agree that their job enables them to communicate with others; this makes someone’s job feel more worthwhile. Nearly 50% of people mostly agreed so this is a high percentage towards good communication.
7
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Motivational Incentives and their affects upon employee commitment
6.1.7 Growing to potential Does your job give you the ability to flourish and grow to your full potential? Mostly disagree
Completely disagree
Neither agree nor disagree
1
Completely agree
Mostly agree
6
4
7 6
Completely disagree
5
Mostly disagree
4
Neither agree nor disagree
3 2
Mostly agree
1
Completely agree
Completely agree
Mostly agree
Neither agree nor disagree
Mostly disagree
0
Completely disagree
number of participants
Opportunities to flourish
Interpretation This chart showing people’s opportunity to flourish within their workplace clearly tells us that the 50 % of participants though they had a little opportunity but not enough and vouched for neither agree nor disagree. This may show that they need encouragement to flourish fully or an internal promotion.
6.1.8 Incentives (statistical analysis question)
Do you have any incentives in place for employees within the company?
Yes 5
8
Don't know
No 6
1
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Motivational Incentives and their affects upon employee commitment
Incentives for employees?
Yes No Don't know
If yes, what are they Qualifications through volunteering
Paid Holiday
Opportunities to work abroad Experience Social events
Interpretation This pie chart tells us that 50% of participants thought that there were no incentives in place within their company, which is a shocking figure. Although some people did say yes and highlighted as to what incentives. Some that came up were qualifications and experience which should come customary in most watersports position, training is necessary in any workplace. Social events and paid holiday are some luxuries that if used appropriately could be very effective towards motivation. But this chart goes to show that the majority of people aren’t aware of the incentives that are available to them.
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Motivational Incentives and their affects upon employee commitment
6.1.9 Motivational Incentives meter
What type of incentive would motivate you most (rank these in numerical order, the lowest been the most important incentive to you)? Money
Medical/Dental plans
Holiday
Social
6
Job satisfaction
Contribution to company
3
3
1
1
2
3
1
3
2
3
2
2
2
3
5
4
2
1
4
1
3
6
4 4
2
Fear
3
2
1
2
1
1
1
Interpretation This question was important to determine exactly what would motivate people to work harder using a ranking system of 1-7. Money was the most important for motivating people because it got 6 participants for 1st, followed by social with 3 votes and contribution to company with 2.
6.2 Falmouth Marine School 6.2.1 Job Satisfaction
On a scale of 1-10 how much do you like your job (1 being not at all 10 being thoroughly enjoyable)
1
2
3
4 3
10
5
6
7
8
9
10
3
2
2
1
1
Motivational Incentives and their affects upon employee commitment
How much do you like your job?
number of participants
3.5
1
3
2
2.5
3
2
4
1.5
5
1
6
0.5
7 8
0 1
2
3
4
5
6
7
8
9
10
9 10
1-10
Interpretation This chart doesn’t put much across because it shows that most of the participants are happy with their job but some are just a bit unhappy with 50% of the votes between 4 and 6.
6.2.2 Job Security How secure do you feel within your job Not secure at all 3
Not very secure
Not sure
Quite secure
3
Very secure
6
Job security
Not secure at all Not very secure Not sure Quite secure Very secure
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Motivational Incentives and their affects upon employee commitment
Interpretation This chart shows us that 50% of participants feel quite secure in their jobs and 75% feel secure whereas only 25% feel they are not secure at all.
6.2.3 Alternative position Is there a position within a company that you would rather be doing than your current job and why? Yes
No 6
Maybe 4
2
number of participants
Would you rather have a different position?
Maybe
Maybe No
No Yes
Yes
0
1
2
3
4
5
6
7
Interpretation This graph simply shows that 50% of the participants if offered an alternative position to their liking they would take it. This shows that their current jobs may not be as rewarding as it appears in other graphs.
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Motivational Incentives and their affects upon employee commitment
6.2.4 Position continued If No proceed to question 6 More pay
4
better quality of work
3
more enjoyable
more suited your skills
Full Time
1
other job opportunities
more pay better quality of work more enjoyable more suited your skills Full time
Interpretation
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Motivational Incentives and their affects upon employee commitment
This graph shows that 50% of people if offered a new job would go for the position that offered more pay. 75% of participants would take a position that offers a better quality of work, so something that they feel their skill set is made for.
6.2.5 Receptiveness or Tedium
How repetitive or tedious do you find the tasks within your job description
Very repetitive
Slightly repetitive 2
Not sure
6
Not very repetitive
Not at all repetitive
3
1
Repetitive or tedious work
number of participants
Not at all repetitive Not at all repetitive
Not very repetitive
Not very repetitive Not sure
Not sure Slightly repetitive
Slightly repetitive
Very repetitive
Very repetitive 0
1
2
3
4
5
6
7
Interpretation 50% of participants feel their job is slightly repetitive and only 1 person thinks there job isn’t tedious. This would reduce motivation levels in a workforce, the way to overcome this would be to vary the jobs given to employees so they have something new to try, it will also give them an opportunity to gain skills
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Motivational Incentives and their affects upon employee commitment
6.2.6 Ability to communicate My job gives me plenty of opportunities to communicate and work alongside others
Completely disagree
Neither agree nor disagree
Mostly disagree
Mostly agree
3
Completely agree 5
4
Opportunties to communicate with others
Completely disagree Mostly disagree Neither agree nor disagree Mostly agree Completely agree
Interpretation This doughnut chart shows that about 40% of people believe their job gives them an opportunity to communicate with others and the same completely agree that they have the opportunity to communicate. This means the employees’ skills and information will be passed on very easily.
6.2.7 Ability to flourish Does your job give you the ability to flourish and grow to your full potential?
Completely disagree
Neither agree nor disagree
Mostly disagree 5
15
4
Mostly agree
Completely agree 2
1
Motivational Incentives and their affects upon employee commitment
6 Completely disagree
5
Mostly disagree
4
Neither agree nor disagree
3 2
Mostly agree
1
Completely agree
Completely agree
Mostly agree
Neither agree nor disagree
Mostly disagree
0
Completely disagree
number of participants
Ability to flourish and grow
Interpretation This graph identifies whether participants have the opportunity to learn skills and reach their full potential. 5 out of 12 people mostly disagree that their job allows them to grow to their full potential. However some people may overestimate their own potential and think there job is holding them down whereas they are actually perfect in their job.
6.2.8 Incentives (Statistical analysis question)
Do you have any incentives in place for employees within the company?
Yes
No 2
16
Don't know 9
1
Motivational Incentives and their affects upon employee commitment
number of particpants
Incentives within company 10 9 8 7 6 5 4 3 2 1 0 Yes
Series1
No
Don't know
Interpretation This chart is very simple to interpret, it gives a triangle formation to show that over 75% of participants said there were no incentives within their company and 2 people said they didn’t know. The people that said yes were maybe referring to minimalistic incentives that may be important to them but not significant for the others to notice. If a business introduces new incentives every so often then employs will also be contempt with what they have thinking they have something extra.
If yes, what are they Awards
6.2.9 Motivation incentives
What type of incentive would motivate you most (rank these in numerical order, the lowest been the most important incentive to you)? Medical/Dental plans
Money
Holiday
4
1
2
4
1
Contribution to company 2
Fear 4
5
1 3
17
Job satisfaction
Social
4
1
1
Motivational Incentives and their affects upon employee commitment
1
5
1 1
2
2
4
3
2
3
2
3
5
3
1
2 3
4
1
3
5
Interpretation This table appears to be the most completed question and can’t be formed into a chart; however it clearly shows that money and fear are the most important motivational incentives. Fear scored fairly highly in this test which is quite worrying because it means autocratic management are putting procedures in place to scare employees into working. It also shows that social is the least liked of all motivational incentives so these employees are not motivated by social events held by their company to allow them to communicate with colleagues.
7.0 Statistical analysis
The test that I am going to use is the Pearson correlation, it will be used to analyse two different questions that are important towards analysing my hypothesis and coming to a conclusion. This test is the most common measure of correlation in a data set.
Pearson correlation or r = Sxy / (SQRT(Sxx*Syy))
7.1 Method
18
-
First find the mean of x.
-
Now find (x - (mean of x)) for each column
-
Square each of the numbers
-
Achieve the sum of the whole column = Sxx
-
Now find (y - (mean of y)) for each column
-
Again square each of these
-
Achieve the sum = Syy
-
Now find (x - (mean of x))(y - (mean of y)) for each column
Motivational Incentives and their affects upon employee commitment
-
Achieve the sum of this column = Sxy
7.1.1 Local Watersports Centre x-meanx 4.916667 4.916667 4.916667 4.916667 4.916667 -4.08333 -4.08333 -4.08333 -4.08333 -4.08333 -4.08333 -0.08333 sxx
squared 24.17361 24.17361 24.17361 24.17361 24.17361 16.67361 16.67361 16.67361 16.67361 16.67361 16.67361 0.006944 220.9167
y-ymean -3.41667 -3.41667 -1.41667 -1.41667 -0.41667 -0.41667 -0.41667 -0.41667 0.583333 0.583333 0.583333 0.583333 syy
squared 11.67361 11.67361 2.006945 2.006945 0.173611 0.173611 0.173611 0.173611 0.340277 0.340277 0.340277 0.340277 29.41667
squared x and y -16.7986 -16.7986 -6.96528 -6.96528 -2.04861 1.70139 1.70139 1.70139 -2.38194 -2.38194 -2.38194 -0.04861 sxy -51.6667
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Motivational Incentives and their affects upon employee commitment
sxy / SQRT (Sxx*Syy)
-0.64091
Pearson correlation states that if the critical value number is above 0.381 then you should reject your null hypothesis and accept you null hypothesis And if it is below 0.381 then you should accept your null hypothesis and reject your alternative hypothesis Therefore for this business we need to accept the null hypothesis and reject the alternative hypothesis. 7.1.2 Falmouth Marine School x-meanx 7.166667 7.166667 -1.83333 -1.83333 -1.83333 -1.83333 -1.83333 -1.83333 -1.83333 -1.83333 -1.83333 2.166667 sxx
squared 51.36111 51.36111 3.361111 3.361111 3.361111 3.361111 3.361111 3.361111 3.361111 3.361111 3.361111 4.694444 137.6667
y-ymean -1.75 -1.75 -1.75 0.25 0.25 0.25 1.25 1.25 2.25 2.25 3.25 4.25 syy
squared 3.0625 3.0625 3.0625 0.0625 0.0625 0.0625 1.5625 1.5625 5.0625 5.0625 10.5625 18.0625 51.25
squared x and y -12.5417 -12.5417 3.208333 -0.45833 -0.45833 -0.45833 -2.29167
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Motivational Incentives and their affects upon employee commitment
-2.29167 -4.125 -4.125 -5.95833 9.208333 -32.8333
sxy
sxy / SQRT (Sxx*Syy)
-0.39089
If we look again at the critical values table it tells us that we need to accept the null hypothesis and reject the alternative hypothesis.
7.2 Pearson correlation coefficient critical values table df = n -2 Level of Significance (p) for Two-Tailed Test
df 1
.10 .988
.05 997
.02 .9995
.01 .9999
2
.90
.950
.980
.990
3
.805
.878
.934
.959
4
.729
.811
.882
.917
5
.669
.754
.833
.874
6
.622
.707
.789
.834
7
.582
.666
.750
.798
8
.549
.632
.716
.765
9
.521
.602
.685
.735
10
.497
.576
.658
.708
11
.476
.553
.634
.684
12
.458
.532
.612
.661
13
.441
.514
.592
.641
14
.426
.497
.574
.623
8.0 Findings 21
Motivational Incentives and their affects upon employee commitment
The findings of my study are as follows
Both companies have shown that they do not have fully motivated employees
The employee’s commitment is not affected by motivational incentives
Employee’s in the watersports business enjoy their job more than employees in teaching
The employee’s are not very motivated by their management
There are not enough significant incentives in place to increase employee commitment
The employee’s aren’t aware of any incentives in place
The majority of employees feel safe within their jobs
There is a good communication among all the employees
They feel they are been stopped from reaching their peak and growing to their full potential
All the job positions cause high levels of tedium
Incentives in place would influence employees (according to qualitative data)
9.0 Suggestions The suggestions for the companies are as follows:
Put a rotational incentive program in place in order to make sure employees are constantly committed
Use appraisals to communicate and get to know employees and their requirements of the company and management
Intrinsic and Extrinsic motivation factors should be used accordingly with the situation to create employee commitment
Offer training and internal promotion within the company so that people with the skills can reach their full potential, otherwise these people will go elsewhere
New development plans could help towards training and would also enable management to know exactly how an employee was improving, this would also reduce the “tedium factor”
10.0 Limitations of the study The limitations of the study are as follows
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Both businesses are not in the same sector; one is private sector and one public sector
Statistical tests don’t analyse very important qualitative data
Data from participants in a questionnaire basis may not be accurate
Lack of researcher experience
Motivational Incentives and their affects upon employee commitment
Limited time span to study the project
11.0 Conclusion Using statistical and visual interpretations analysis I have come to the conclusion that I have to accept my null hypothesis (N0) and reject my alternative hypothesis (N1). This was visualised in the charts and using Pearson’s correlation coefficient, that “there is no significant correlation between motivational incentives and employee commitment so therefore using this study people in marine sector businesses are not affected by motivational incentives that aren’t already in place.
11.1 Scope for future research The conclusion was not the outcome I had hoped for, however this could be down to various different reasons or variables. For example; the marine industry is a very worthwhile working environment because of the outdoors, sports and leisure activities involved. Another variable could be that the 12 people from each business I asked were inclined towards the null hypothesis, a more in depth study could analyse a wider participant base, including altering the collection of data to many different industries and businesses. The study was very useful in providing key qualitative data to analyse; this provided a good visual interpretation of the results and allows someone researching the subject to come to a faster and more educated conclusion. More statistical tests including a paired t-test could have been used and data could have been gathered faster for two key analysis areas. For example; a survey could have been carried out using incentives, applying them individually to workers and observing which one has most affect in increasing employee output and happiness levels. More statistical tests including a paired t-test could have been used and data could have been gathered faster for two key analysis areas. For example; a survey could have been carried out using incentives, applying them individually to workers and observing which one has most affect in increasing employee output and happiness levels. More time as in any situation could have yielded better results because it would allow for more collection and analysis and more accurate statistical analysis. Also if this data were gathered by the researcher it could be more accurate and not bias.
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Motivational Incentives and their affects upon employee commitment
12.0 References Accel-team. (2012). Elton Mayo's Hawthorne Experiments. Available: http://www.accelteam.com/motivation/hawthorne_02.html. Last accessed 02/05/12. Ali Sukru Cetinkaya. (2011). The Impact of Employee Motivation on Emotional Commitment: Research Undertaken in a Five-Star Hotel. Journal of Transnational Management. 16 (0), 149-156. Bedeian, A. G. (1993). Management (3rd ed.). New York: Dryden Press. Deci (1971), Petri (1991), Lepper, Greene and Nisbett (1973). (2002-2012). Extrinsic motivation. Available: http://changingminds.org/explanations/theories/extrinsic_motivation.htm. Last accessed 02/05/12. Del Siegle, Ph.D.. (10/14/2009). Is there a relationship (difference) or isn't there a relationship (difference)?. Available: http://www.gifted.uconn.edu/siegle/research/Correlation/corrchrt.htm. Last accessed 02/05/12. Dickson, W. J. (1973). Hawthorne experiments. In C. Heyel (ed.), The encyclopedia of management, 2nd ed. (pp. 298-302). New York: Van Nostrand Reinhold. Ellen.M Whitener. (2001). Do "high commitment" human resource practices affect employee commitment?: A cross level analysis using hierarchical linear modelling. Journal of Management. - (27), 515-535. John P. Meyer et al. (2004). A Conceptual Analysis and Integrative Model. Employee Commitment and Motivation . 89 (6), 991-1007. Julian Birkinshaw, Simon Caulkin. (2011). The open secrets of employee motivation. Available: http://management.fortune.cnn.com/2011/06/14/the-open-secrets-of-employee-motivation/. Last accessed 02/05/12. Kendra Cherry. (2012). Hierarchy of needs. Available: http://psychology.about.com/od/theoriesofpersonality/a/hierarchyneeds.htm. Last accessed 02/05/12. Martyn Shuttleworth . (2009). Hawthorne Effect. Available: http://www.experimentresources.com/hawthorne-effect.html. Last accessed 02/05/12. Maslow, A. H. (1943). A theory of human motivation. Psychological Review, July 1943. 370-396. Nitin Nohria et al (2008). Employee Motivation: A powerful new model. Harvard: Harvard Business School Publishing Co.. 1-8. Scott A. Jeffrey et al (2007). The Motivational Properties of Tangible Incentives. Unknown: Sage Publications. 17. Shahid Kv . (2009). A study on employee motivation. Journal of Management studies. 1 (1/2), 1-60. Sunil Ramlall. (2004). A Review of Employee Motivation Theories and their Implications for Employee Retention within Organisations. Journal of American Academy of Business. 5 (1/2), 52. Unknown. (2009). How do you calculate Pearson correlation coefficient?. Available: http://answers.yahoo.com/question/index?qid=20090303084607AAsXE9W. Last accessed 02/05/12.
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Motivational Incentives and their affects upon employee commitment
13.0 Appendix 13.1 Literature review Introduction
What is Motivation? Motivation is the desire to do things and is crucial in setting goals and aims to work towards attaining so that one may become closer to their ‘ideal’. Charles Handy in his book (Understanding Organisations) says that “motivate is one of those ambiguous words, it normally has a subject and an object. X motivates Y, Y is motivated by X.” This is where numerous motivational theories fall into the equation because a management professor Douglas Mcgregor at the MIT Sloan School of management devised something called the “X and Y theory”. The X and Y theory enunciates two sets of propositions for men in an organisation. Theory X is that of a man who works as little as possible and lacks ambition and dislikes responsibility. These people must be motivated controlled and punished most within an organisation. Theory Y is that of a man who is self-motivated and ambitious. These people possess the ability for creative problem solving but their talents are underused in many organisations.
There are many other motivational theories developed by great business men and psychologists, for example Abraham Maslow an American Professor of psychology proposed a theory called the Hierarchy of needs. The theory is based around a triangle which identifies the different stages that an individual goes through to reach self-actualisation. The stages are Physiological, Safety, Love/Belonging, Esteem and then finally selfactualisation. When related to a business this theory can be used for an employee, if they fulfil their own needs and the organisation fulfils their needs then they can reach self-actualisation and will be more motivated within the business.
Another theory developed by an American psychologist Frederick Herzberg looks at different factors that lead towards job satisfaction. There are some factors that result in satisfaction then there are some that prevent dissatisfaction. These are motivational factors and hygiene factors, Hygiene factors are factors that are essential for existence of motivation, if they are absent then this will lead to job dissatisfaction. They can include:
1. 2. 3. 4. 5. 6. 7.
Pay – appropriate and reasonable Company policies – not too rigid Fringe Benefits – Health care plans, employee help programmes. Working conditions – safe, clean and hygienic Status- familiar and retained Interpersonal relations – employee relationships Job security- be safe with their job
The motivational factors yield positive satisfaction; they motivate employees for superior performance. Motivational factors can include:
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Motivational Incentives and their affects upon employee commitment
1. 2. 3. 4. 5.
Recognition – praised and recognised for accomplishments Sense of Achievement Growth and promotional opportunities – opportunities to motivate employees Responsibility – minimise control and maintain accountability Meaningfulness of the work – meaningful, interesting and challenging
Importance
“Commitment is critical to organisational performance, but it is not a panacea. In achieving important organisational ends, there are other ingredients that need to be added to the mix. When blended in the right complements, motivation is the result” (O’Malley, 2000) One of these complements within the business structure is human resources. “Managing human resources effectively and efficiently plays a critical role in ensuring that a satisfied, motivated work force delivers quality services. It also plays an important role in increasing staff performance and productivity, enhancing an organization’s competitive advantage, and contributing directly to organizational goals.” (Janice Miller, 1999 Human Resources: Managing and Developing Your Most Important Asset). Human Resource management is the most important department within an organisation because they look after the needs of any current employees they have, for example; payment, motivation and terms of employment. They also deal with employment of new employees where needed and allocating the employees skill set to the correct area of the organisation. An organisation cannot run efficiently without control and support of their workforce.
Motivational Incentives are very important towards the commitment and empowerment of an organisations employees and this in turn can enhance society and the community as a whole. There are many needs for motivational incentives within a business: 1. 2. 3. 4. 5. 6. 7.
To increase productivity, To drive or arouse a stimulus work, To enhance commitment in work performance, To psychologically satisfy a person which leads to job satisfaction, To shape the behaviour or outlook of subordinate towards work, To inculcate zeal and enthusiasm towards work, To get the maximum of their capabilities so that they are exploited and utilized maximally.
(http://www.managementstudyguide.com/motivation_incentives.htm, 2008)
There are two types of motivational incentives which fall into two motivational categories such as; intrinsic and extrinsic motivation. Non- monetary incentives are part of intrinsic motivation, they can include job security, praise or recognition, suggestion scheme, job enrichment and promotion opportunities. Job security
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Motivational Incentives and their affects upon employee commitment
provides great motivation because an employee has less to think about and can put more effort into their work.
Pay and Financial Incentives
Money is one of the most important motivators within an organisation because an employee can buy any type of assets they need with the money they have been given.
Management should have a payment system that will:
Be effective in recruiting the right quantity and quality of labour Be effective in retaining labour over the required period of time – it is expensive to have to keep advertising for and training new employees Keep labour costs as low as possible in order to maintain the competitiveness of a business Help to motivate staff and encourage effort (careful thought needs to be applied to structuring pay systems in a way that encourages motivation and performance) Be designed to allow for additional rewards and benefits
Most pay is deemed as a basic wage or salary and can be categorised as follows:
Flat Rate Set weekly or monthly rate, based on a set number of hours. Does not provide an incentive to work harder
Time Rate Set rate of pay per hour. Any hours worked over are paid on an ‘overtime rate’. Often employees will use this pay rate as an advantage and will do work slower so that they get paid for more hours. Sometimes management supervision is important.
Piece Rate Payment made for every item produced or job finished that meets quality standards. This encourages the employee to work harder, faster and more efficiently. This however is not suitable for jobs that require time and care. Bonus A bonus is paid as an added encouragement to employees. It can be paid as a result of hard work or at a time when it is believed employees’ effort might slacken.
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Motivational Incentives and their affects upon employee commitment
Commission Payment made on the percentage of sales by the employee
Output-related payment The most common method to reward manual workers, it is and element of time rate plus a bonus or other incentive.
Performance related pay Assessed against working objectives and ‘company goals’, scoring systems are then developed to assess the performance.
Profit Sharing Pay and bonuses are paid based on the profit performance of the business, if employees work hard then the success if the company will reward them.
Fringe Benefits -
pension schemes educational courses travel opportunities crèches housing and relocation packages telephone costs discounts on insurance private healthcare and dental plans time off sports, leisure activities
History
Before the term ‘motivation’ came about manager’s just realised that giving workers things influenced them to accomplish tasks. The oldest known technique is the Carrot and Stick method. “The name evolved from the stubbornness of donkeys that could only be moved by taunting them with a carrot. Early managers regularly offered economic "carrots" to entice people to work harder” (Elton Mayo, 1923). It was later identified that this method was inadequate so 2 minute breaks were introduced and these produced immediate and dramatic results. Morale improved and output increased dramatically.
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Motivational Incentives and their affects upon employee commitment
UK Benefits and commitment to work
There are a total of 2.62 million unemployed in the quarter, the highest total since 1994. In September 2011 the number of people claiming jobseeker’s allowance raised by 5,300. Most of the media in the UK perceive those people who are on benefits within the UK just don’t have the motivation to work. They are required to attend so many job interviews and apply for so many jobs a month however they just aim to not get these jobs so that they can remain on jobseeker’s allowance. It is believed that UK jobseeker’s allowance pays more a week than a job on minimum wage with average hours, this is one reason people do not work. However, David Cameron has outlined plans to bring in a Welfare Reform Bill; this bill will benefit those people in society who are working. He said “Never again will work be the wrong financial choice... We are finally going to make work pay for some of the poorest people in our society." Journal analysis
One journal titled “a review of Employee Motivation Theories and their implications for Employee Retention within organisations” looks at different theories to motivate employees so that they are happy and remain in their job. It analyses Maslow’s Hierarchy of needs, McClelland’s need theory, Equity Theory, Expectancy Theory, Vroom’s original theory and the Two Factor Theory. The journal looks at how these theories affect employee retention and the behaviours of employees within the organisation. Swanson (2011) emphasised that theory is required to be both scholarly in itself and validated in practice, and can be the basis of significant advantages. Because of low employment levels the author decided to identify, analyse and critique employee motivation theories to show a relationship. Hale (1998) stated that 86% of employers were experiencing difficulty attracting new employees and 58% of organisations claim that they are experiencing difficulty retaining their employees. There must have been an explanation for these statistics. This journal will relate to my project because it looks at theories within a business and analyses their structure and impact upon the employees, my project will look at the same sort of thing but with motivational incentives.
Employee Commitment is also very important as a pre-cursor to employee retention. A journal titled “The Impact of Employee Motivation on Emotional Commitment” looks into this study. The investigation outlined in this journal was carried out with employees at a five star hotel. It discovers that if the employees are motivated, happy and productive within the workplace then the customer satisfaction will increase and the business ill be more successful. “Employee behaviours such as smiling, courtesy, sincerity, cleanliness, friendship and understanding towards hotel guests have a profound impact on customer satisfaction for the given service (Kantarcl, 1997). Motivation is said to be on of the most researched subjects that has been investigated in literature both in the business world and personal world. Researchers found that the effects of work motivation are related to the variables of job satisfaction, turnover, absenteeism, intention to leave job, performance and commitment (Ertan, 2008). This study investigated the relationship between intrinsic and extrinsic motivators, employee work motivation and affective commitment of hotel employees. It will relate comfortably with my research because of the investigation into intrinsic and extrinsic motivators. Essentially my investigation is very similar but just based upon the marine sector. It would be interesting to investigate whether quality of life and job had an impact upon employee’s motivation also.
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Motivational Incentives and their affects upon employee commitment
Another journal titled “Employee Commitment and Motivation: A conceptual analysis and integrative model� also identifies that employee motivation is very important towards a successful workforce. ‘Organisational scientists and practitioners have long been interested in employee motivation and commitment. This interest derives from the belief and evidence that there are benefits to having a motivated and committed workforce (Locke & Latham, 1990; Meyer and Allen, 1997; Pinder, 1998). This journal aimed to strengthen the literature on motivation by integrating a number of theories into a single theory so that the understanding of human behaviour in the workplace can be more advanced. This will relate to my investigation because it identifies some key areas of why motivation and commitment is important in and organisation.
Project The investigation I am going to carry out could be very useful and influential towards the Human Resources sector of the business world. My project title is Motivational Incentives and their affect on Employee Commitment within 4 marine sector businesses. I aim to take 4 businesses in the marine sector and do a survey with all their employees to see if they are happy with their job and if they are motivated to work within their workplace. Once I have collected the results from the 4 businesses. I will compare the motivation to the incentives they have in place and look at other incentives that might be able to improve the commitment of employees. I will also analyse the hierarchy of each businesses and see if their motivation relates to their job title or their position within the business. After all the data is collated I will create a pack for each businesses management team to inform them about the motivation of their workforce and possible changes they can make to further motivate their workforce. If I identify the incentives that are present in each business then I can analyse the effectiveness of certain incentives within an organisation, remembering to distinguish between intrinsic and extrinsic motivators. This literature should provide organisations with a informative writing that will help them to decided which motivational incentives would be the most constructive to increase the commitment of their employees. References Ali Sukru Cetinkaya. (2011). The Impact of Employee Motivation on Emotional Commitment: Research Undertaken in a Five-Star Hotel. Journal of Transnational Management. 16 (0), 149-156. Bard Kuvaas. (2006). Work Performance, affective commitment and work motivation: the roles of pay administration and pay level. Journal of Organisational Behaviour. 27 (3), 365-285. Barney, Jay B., and Ricky W. Griffin. The Strategy Management Structure of Behaviour Organization. Boston: Houghton Mifflin, 1992. Charles Handy (1993). Understanding Organisations. 4th ed. England : Clays Ltd.. 29-60. Greenberg, Jerald, and Robert A. Baron. Behaviour in Organizations. Needham Heights: Simon and Schuster, 1993. John P. Meyer et al. (2004). A Conceptual Analysis and Integrative Model. Employee Commitment and Motivation . 89 (6), 991-1007.
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Motivational Incentives and their affects upon employee commitment
Nitin Nohria et al (2008). Employee Motivation: A powerful new model. Harvard: Harvard Business School Publishing Co.. 1-8. Rob Dransfield and Dave Needham (2005). Applied Business. Oxford: Heinemann Educational Publishers. 8493. Scott A. Jeffrey et al (2007). The Motivational Properties of Tangible Incentives. Unknown: Sage Publications. 17. Sunil Ramlall. (2004). A Review of Employee Motivation Theories and their Implications for Employee Retention within Organisations. Journal of American Academy of Business. 5 (1/2), 52. Timothy Dixon et al. (2005). Lessons from the private finance initiative in the UK: Benefits, problems and critical success factors. Journal of Property Valuation and Investment. 23 (5), 412-423 Unknown. (2008-2012). Herzberg's Two Factor Theory of Motivation. Available: http://www.managementstudyguide.com/herzbergs-theory-motivation.htm. Last accessed 12/12/11.
Unknown. (2011). David Cameron sets out Welfare Reform http://www.bbc.co.uk/news/uk-politics-12486158. Last accessed 12/12/11.
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plans.
Available: