THE IMPACT OF INCENTIVE SCHEMES ON EMPLOYEE PERFORMANCE IN AN ORGANIZATION
THE IMPACT OF INCENTIVE SCHEMES ON EMPLOYEE PERFORMANCE IN AN ORGANIZATION
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The administration of staff incentives scheme have now become a popular phenomenon of the total personnel policy of any organization. The scheme involves these extra benefits which may not necessarily be money, which emanate from the kind relationship of the employer to the employees, to supplement their usual wages, from time and which are at most times geared purposely towards the enhancement of workers performance in the organization.
Incentive management for employee performance is very important to both the organization and the employees. From the employer’s point of view it is anticipated that a good employee incentive management will induce the employees to work hard and improve their general attitude toward the organization. But for the employee, these benefits represent some additional rights such as extra income, additional security or more desirable working conditions that should not require an additional effort.
In business organizations, employers of labor have seen in employee incentive services the ability to invoke commitment and co-operation of the subordinates to contribute more to the achievement of the organizational goals and aspirations. This discovery has led many employers of labor to the introduction of well packaged incentive management programs with the sincere belief that a good employee services will induce the employees to work hard and improve the general organizational morale.
The situation remains relatively the same but for the difference in methods of payment and apparent change in emphasis.The appraisal of the employee incentive management scheme are defined as “something of value apart from the agreed regular monetary payment of salaries and wages given to employees”. This will be used as the working definition for this research work.
Incentive management services exist in all culture and in all organization and had existed at all times. They take different shapes and forms and attract different names. In recognition of their worker need fulfillment functions, they are variously called “incentive services” “employee incentive benefits” or simply “supplementary, compensation or “pay and non wage remuneration. As non taxable income and expenses, they are beginning to be called “indirect compensation and non tax benefit”.
In the past they used to be tiny bits and pieces of goodies that occasionally fall from the high tables of paternalistic employer i.e when the top management play a fatherly role to the employee.
It should be noted that for the company to achieve its objective her incentive management service should be adequate, competitive and tailored towards the real need of the employee. Employees are directly influenced by nature, quality and quality of incentive services offered because they compare themselves with their counterparts in other organizations.
In this research work, workers do prefer increase in incentive services to increases in salaries especially during the period of inflation and rising prices, workers normally get frustrated and dissatisfied when incentive services are inadequate. But if the opposite condition prevails workers have been observed to be satisfied and more committed to give off their best to the achievement of the company’s objectives.
Incentive management is incentives given in cash or kind aimed at getting the best out of an employee or group of employees. Motivation aims at optimum performance of employees. Many factors have to do with characteristics of the individuals. Different people are endorsed with different potential, training, skills and receptions ability to change. Employee attitude and behavior are also influenced by their remuneration and other incentive such as prestige, special allowance and retirement benefits. Conditions and environment of work also affect productivity.
Incentive management can also be a compensation package, reward for performance. Employees prefer cash items such as salary, allowances, Christian bonus, or in non cash items which we call fringe benefits such as giving the product of the organization to the workers, protective clothing, cars with or without driver.
1.2 STATEMENT OF PROBLEMS
Often workers or employees are attracted to certain organizations not only because of the pay packages that are stated in the advert but also because of the benefits attached to them. Those benefits usually include, housing, transport and medical allowances together with pension or retirement benefits to mention but a few.
These attractions may constitute a considerable objective for which such individuals made-up their mind to serve in each organization. The Spence or reduction in these primary attractions of such individuals into the organization will certainly lower the morale as well as the efficiency of such individual’s performance which will in turn reflect on the organization’s productivity.
The dissatisfaction expressed by the employee either on the provision or administration to employee incentive service activities become some serious problem which demand for proper investigation and examination in order to find lasting solutions to them, are as follows:
(i) The implementation of employee incentive management in the company is not too effective.
(ii) Employee incentives are not taken care of, their salary structure or payment is poor.
(iii) The management function is not effective as workers or employees show a negative attitude towards their job, that is inadequate responsibility, high rate of absenteeism and indiscipline.
(iv) Also, the flow of communication between the workers and management is inadequate.
(v) There are weak measures used in making sure these problems are tackled to enhance productivity.
1.3 OBJECTIVES OF THE STUDY
The objectives of this study are as follow:
(a) To determine if incentive management exists in organizations.
(b) To ascertain whether any of the service rendered by the employees in the company has been withdrawn due to withdrawal of some incentives.
(c) To identify if incentive packages are promptly given by organizations
(d) To ascertain whether there are other benefits which the employees demanded for effective performance of their job that are not yet provided.
(e) To ascertain the problems if any that is encounter by the company in the administration of employee services.
(f) To determine the effectiveness of employee incentive management in organizations as perceived by the employees.
(g) To make recommendations based on this study on how to improve the provision and administration of employee incentives in organizations
1.4 SCOPE OF THE STUDY
The scope of this study covers a large spectrum of enterprises. It is hoped that the study of the management of incentives in organizations will serve as an eye opener to efficient management of employee services in other companies in Nigeria.
1.5 RESEARCH HYPOTHESIS:
H1: Incentives management will improve employee performance in organizations.
H2: Incentives management will not improve employee performance in organizations.
H3: There is a strong relationship between incentives management and employee performance in organizations
H4: There is a weak relationship between incentives management and employee performance in organizations.
1.6 RESEARCH QUESTIONS:
- Will proper incentives management increase organizational productivity.
- Will increase in incentives bring about a significant increase in employee performance
- Do organizations in Nigeria practice incentive management programs
- Are incentive management practices in Nigeria effective.
- Does incentives management practice have a significant impact on the Nigeria economy
- Will a reduction in incentive packages have a negative impact on employee morale and productivity
1.7 LIMITATIONS OF THE STUDY
A study of this nature cannot be completed without encountering some constraints or limitations. In the course of this research these constraints range from time. Duration posed a limitation, finance, cost to get these materials. Another notable limitation as experienced by the researcher was the uncooperative and uncompromising respondents. Companies are reluctant release very useful, comprehensive, accurate and relevant data.
Members of top management were usually not on seat or will only spare few minutes for an interview that requires more time. People air their views on the platform of biasis and prejudice, and this creates a blockage to well screened observations and conclusions
1.8. SIGNIFICANCE OF THE STUDY
In view of this research work, the beneficiaries are as follows: managements, employees and organizations.
MANAGEMENT: The management tends to benefit when these incentives such as special allowance and retirement benefits, prestige, condition and environment of work are provided. Workers are committed to give off their best to the achievement of the company’s objective.
EMPLOYEE: – The employee will also benefit when incentive services are introduced in the organization due to the employers sincere belief that a good employee incentive service activity will induce them to work hard and improve general employee morale.
Other organizations thus try as much as possible to attain their corporate objectives by helping their staffs to accomplish their own personal objectives. This they do by setting up ideal incentive management for the benefit of their employees.
1.9 DEFINITION OF TERMS
For the purpose of this research work the following key words are defined as follows:
EMPLOYEE: Any person who works for an employer in return for wages, salary or other valuable considerations.
ORGANIZATION: It is an act of coordinating a body of people. It is also the structure of relations that exist between positives in a group.
EMPLOYEE MORALE: This means the condition of workers regarding discipline and confidence.
INCENTIVE: These are extra benefits attached to wages and salaries, or given as separate packages.
WORK: A task which an employee is assigned to perform.
PERFORMANCE: This refers to the execution of duty by a worker.
MANAGEMENT: Management in all business and organizational activities is the act of coordinating the efforts of people to accomplish desired goals and objectives using available resources efficiently and effectively. Management comprises planning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal
RESOURCING: Resourcing encompasses the deployment and manipulation of human resources, financial resources, technological resources, and natural resources.
EMPLOYEE WELFARE: Welfare is the provision of a minimal level of well-being and social support for all employees.
RECRUITMENT: Recruitment refers to the process of attracting, screening, selecting, and onboarding a qualified person for a job. At the strategic level it may involve the development of an employer brand which includes an ’employee offering.
RETIREMENT: Retirement is the point where a person stops employment completely
ABSENTEEISM: Absenteeism is a habitual pattern of absence from a duty or obligation. Traditionally, absenteeism has been viewed as an indicator of poor individual performance, as well as a breach of an implicit contract between employee and employer
PRODUCTIVITY: Productivity is the ratio of output to inputs in production; it is a measure of the efficiency of production.
TABLE OF CONTENT:
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
1.2 Statement of the Research Problem
1.3 Objectives of the Study
1.4 Significance of the Study
1.5 Research Questions
1.6 Research Hypothesis
1.7 Conceptual and Operational Definition
1.8 Assumptions
1.9 Limitations of the Study
CHAPTER TWO
LITERATURE REVIEW
2.1 Sources of Literature
2.2 The Review
2.3 Summary of Literature Review
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Research Method
3.2 Research Design
3.3 Research Sample
3.4 Measuring Instrument
3.5 Data Collection
3.6 Data Analysis
3.7 Expected Result
CHAPTER FOUR
DATA ANALYSIS AND RESULTS
4.1 Data Analysis
4.2 Results
4.3 Discussion
CHAPTER FIVE
SUMMARY AND RECOMMENDATIONS
5.1 Summary
5.2 Recommendations for Further Study
Bibliography
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