Motivation Flashcards
Methods of financial motivation
Salary
Commission
Piece rate
Performance related pay
Profit sharing
What is a Salary
set income based on the job role as an annual fee
Pros/Cons of a salary
Not linked to performance
No increase motivation/performance
What is a Commission
A bonus paid based on achieving a sales target. Rewards for the quantity or value of work achieved
Pro/Con of a commission
increases motivation (for more sales)
Misinform customers to make a sale (reputation)
What is a Piece rate
pay based on the number of units of output produced
Pros/Cons of piece rate
Increases output
Reduced quality
What is Performance related pay
bonuses achieved by reaching a target
Pros/Cons of performance related pay
Does not encourage teamwork
Not significantly increasing motivation (as it is just a small bonus)
What is profit sharing
Distributing a percentage of net profit across the workforce
Pros/Cons of profit sharing
Reward linked to the overall success of the business
Depends on businesses profitability
Methods of non-financial motivation
Job design
Appraisal system
Teamworking
Employee recognition
What is Job design
Designing the role, tasks and responsibilities so it improves motivation
Pros/Cons of job design
Challenging work is interesting
Always some aspect of job that staff don’t like/repetition
What is appraisal
review of performance and recognising achievement
Pros/Cons of appraisal
feel recognised
receive feedback
promotion opportunities
meet needs of staff
appraisal time reduces time doing actual job
What is teamworking
workforce in teams to meet social aspect of motivation
Pros/Cons of teamworking
Sense of belonging
Connection to the business through peers
Difficult to identify workers who are less productive
Factors affecting if we use financial/non-financial methods
Skill level of managers
Use of Soft or Hard HRM
Skilled workforces (more job enrichment)
Nature of the business
What method would a competitive sales environment use
financial method, such as commissions
Benefits of motivation?
Better customer service
High labour productivity
High employee engagement
Better quality product
Better manager-employee relations
Lower labour turnover
lower labour cost per unit
