3.5 Motivation And Retention

Question 1

What are the different methods of financial motivation?

Answer 1

•Pay
•Bonuses
•Profit Sharing
•Fringe- Benefit

Question 2

What is pay?

Answer 2

A wage is usually paid weekly and is based on the number of hours worked

Question 3

What are the advantages of pay/wages?

Answer 3

•motivates workers as they receive a regular income
•it motivates them to work more because the more they work the more they recieve

Question 4

What are the disadvantages of pay/wages?

Answer 4

•it only rewards workers for how long they work and not how well

Question 5

What are bonuses?

Answer 5

A payment a worker receives in addition to their pay

Question 6

What are the advantages of bonuses?

Answer 6

•it motivates workers because the more they produce or sell the more they earn (increases productivity)
•motivates them to reach particular targets

Question 7

What are disadvantages of bonuses?

Answer 7

•if targets are not fair or realistic workers will not feel motivated

Question 8

What is profit sharing?

Answer 8

When workers are paid part of the profits of the business

Question 9

What are the advantages of profit sharing?

Answer 9

•it motivates workers because they know if they work efficiently the business will earn more profit increasing their income

Question 10

What are the disadvantages of profit sharing?

Answer 10

• reduces profits for shareholders

Question 11

What are fringe benefits?

Answer 11

Benefits given to workers on top of their pay e.g. free gym membership

Question 12

What are advantages of fringe benefits?

Answer 12

•helps business retain workers as they won’t want to lose the benefits

Question 13

What are the disadvantages of fringe benefits?

Answer 13

•they are a cost to the business so may reduce profits

Question 14

What are non financial methods of motivation?

Answer 14

•praise
•award schemes
•working environment

Question 15

What is praise?

Answer 15

Workers are acknowledged and appreciated for the work they’ve been done e.g. through an email, thank you card or verbally

Question 16

What are advantages of praise?

Answer 16

•it makes workers feel appreciated and valued
•Those not praised may feel encouraged to do better in order to receive praise

Question 17

What are the disadvantages of praise?

Answer 17

Sometimes if there is not financial reward for a long period of time workers may feel less valued demotivating them

Question 18

What is an award scheme?

Answer 18

When workers are presented with a reward for their work e.g. certificates or a voucher

Question 19

What are advantages of an award scheme?

Answer 19

•makes workers feel valued
and more motivated
•will encourage them and others to continue to increase productivity to recieve the reward

Question 20

What are the disadvantages of an award scheme?

Answer 20

•there is some cost to them
•they need to be given fairly or something workers may feel upset and demotivated

Question 21

What is the working environment method?

Answer 21

Improving working environment so it is a pleasant place to work e.g. listening to people and giving them a say

Question 22

What are the advantages of a good working environment?

Answer 22

•helps business retain workers as they feel their options are valued and that they’re being listened to
•if workers feel valued they’ll respect the business creating a positive attitude to work

Question 23

What are the disadvantages of a good working environment?

Answer 23

It may have some cost e.g. improving furniture or paying for activities

Question 24

What are advantages of improved motivation?

Answer 24

•lower abteeism - workers will have a positive attitude to work and will be less likely to take days off
•improved quality and productivity
•reduced levels of supervision of workers- businesses may not have to recruit as many supervisors as workers will want to do their job well already

Question 25

What are the advantages of improved retention?

Answer 25

•saves money on recruitment costs
•saves money on induction training
•leaves the business with a good reputation so it will be easier to recruit new workers