Bus Man AOS 2

Question 1

List financial motivational strategies

Answer 1

• Pay increase
• Bonuses
• Commissions
• Share plans
• Profit sharing
• Gainsharing

Question 2

What are advantages of pay increases?

Answer 2

• predictable and easily calculated as it can be linked to levels of an award
• it provides the newer employee with a clear target to aim for in a pay rise

Question 3

What are disadvantages of pay increases?

Answer 3

• difficult to cut pay if the employee’s performance declines
• jealousies and lower morale because of other staff getting better pay

Question 4

What are advantages of bonuses?

Answer 4

• Can be varied from employee to employee, depending on level of performance
• Only have to be paid when there is actual performance improvement

Question 5

What are disadvantages of bonuses?

Answer 5

• If confidentiality is not maintained, different levels of bonus can lead to conflict between employees
• If the value of the bonus is not maintained or increased each year, it may lead to employee dissatisfaction

Question 6

What are advantages of commission?

Answer 6

• Only apply when sales take place, so a relatively low cost for the employer
• Can motivate sales staff to work harder to close a deal, so genuinely rewards effort

Question 7

What are disadvantages of commission?

Answer 7

• If base pay is too low, some employees may not earn enough, so may leave, resulting in high staff turnover
• Can lead to large differences in staff pay, with possible morale

Question 8

What are advantages of share plans?

Answer 8

• All employees have an interest in increasing profits and improving the share price
• Employees feel a sense of ownership and belonging in the business as they are shareholders

Question 9

What are disadvantages of share plans?

Answer 9

• may not be a secure investment for the employees because share prices go up and down depending on business performance.
• Employees are usually not permitted to sell their shares until they leave the company

Question 10

What are advantages of profit sharing?

Answer 10

• Tied to levels of profit, so genuinely rewards improvements in that measure
• Is relatively easily calculated, and the percentage can be determined in advance

Question 11

What are disadvantages of profit sharing?

Answer 11

• Usually does not vary between employees so does not always identify individual effort or performance
• If profit drops because of external factors, employees may feel unfairly treated when their share declines

Question 12

What are advantages of gainsharing?

Answer 12

improves level of engagement, productivity and commitment

- Paid according to measurable improvements, so has a readily calculated value

Question 13

What are disadvantages of gainsharing?

Answer 13

Employees have to share the benefits with those who have not made such a contribution

Question 14

List non-financial motivational strategies

Answer 14

• Career advancement
• Investment in training
• Support
• Sanction

Question 15

What are advantages of career advancement?

Answer 15

• Can provide a means of retaining valuable employees

- Satisfies three of the higher level needs of Maslow’s hierarchy

Question 16

What are disadvantages of careers advancement?

Answer 16

• Promotion positions cannot just be created — they have to have some purpose
• Employees may have to compete, creating some rivalries and conflicts

Question 17

What are advantages of investment in training?

Answer 17

• Benefits the business by improving the skills of employees
• Improving skills can satisfy higher level needs in Maslow’s hierarchy, providing goals for goal- setting theory, and satisfying some of the four drives

Question 18

What are disadvantages of investment in training?

Answer 18

• training may be wasted due to a lack of higher level jobs

- The business may pay the cost of training only to have the employee leave for a position in another business

Question 19

What are advantages of support?

Answer 19

-Support and encouragement can influence employee attitudes, improving motivation

Question 20

What are disadvantages of support?

Answer 20

• It may be difficult to find reasons to support and encourage some employees

Question 21

What are advantages of sanction?

Answer 21

• motivate some workers to improve their work performance

Question 22

What are disadvantages of sanction?

Answer 22

-Excessive emphasis on sanctions can reduce employee sense of belonging, and therefore have a negative impact on motivation

Question 23

What are the benefits of training to employees?

Answer 23

• opportunity for promotion and self improvement

- Improved job satisfaction through better job performance

Question 24

What are the benefits of training to employers?

Answer 24

• Goals and objectives are effectively met

- More capable ‘mobile’ workforce