Bus Man AOS 2 Flashcards
List financial motivational strategies
- Pay increase
- Bonuses
- Commissions
- Share plans
- Profit sharing
- Gainsharing
What are advantages of pay increases?
- 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
What are disadvantages of pay increases?
- difficult to cut pay if the employee’s performance declines
- jealousies and lower morale because of other staff getting better pay
What are advantages of bonuses?
- Can be varied from employee to employee, depending on level of performance
- Only have to be paid when there is actual performance improvement
What are disadvantages of bonuses?
- 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
What are advantages of commission?
- 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
What are disadvantages of commission?
- 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
What are advantages of share plans?
- 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
What are disadvantages of share plans?
- 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
What are advantages of profit sharing?
- Tied to levels of profit, so genuinely rewards improvements in that measure
- Is relatively easily calculated, and the percentage can be determined in advance
What are disadvantages of profit sharing?
- 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
What are advantages of gainsharing?
improves level of engagement, productivity and commitment
- Paid according to measurable improvements, so has a readily calculated value
What are disadvantages of gainsharing?
Employees have to share the benefits with those who have not made such a contribution
List non-financial motivational strategies
- Career advancement
- Investment in training
- Support
- Sanction
What are advantages of career advancement?
- Can provide a means of retaining valuable employees
- Satisfies three of the higher level needs of Maslow’s hierarchy
What are disadvantages of careers advancement?
- Promotion positions cannot just be created — they have to have some purpose
- Employees may have to compete, creating some rivalries and conflicts
What are advantages of investment in training?
- 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
What are disadvantages of investment in training?
- 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
What are advantages of support?
-Support and encouragement can influence employee attitudes, improving motivation
What are disadvantages of support?
• It may be difficult to find reasons to support and encourage some employees
What are advantages of sanction?
- motivate some workers to improve their work performance
What are disadvantages of sanction?
-Excessive emphasis on sanctions can reduce employee sense of belonging, and therefore have a negative impact on motivation
What are the benefits of training to employees?
- opportunity for promotion and self improvement
- Improved job satisfaction through better job performance
What are the benefits of training to employers?
- Goals and objectives are effectively met
- More capable ‘mobile’ workforce
