ABSTRACT
The study was designed to provide information to organisations
and establishments in either the Private or Public Sector in appreciating the
impact of incentive plans on the performance of employees.
The population of this study consisted of 50 respondents (38
males and 12 females) in age range of 21‑60 years with a mean of 33years who
have been working in their respective offices. The sample of the study
consistent of 40 Junior State and 10 Senior Staff that were randomly selected
using the random sampling technique.
The study was in two phases, the first phase was on
standardization of the test instrument while the second phase was on
assessment. The result of findings revealed a positive significant reliability
of co‑relation co‑efficient of the instrument used. It was also recommended
that a periodic review of both monetary and non‑monetary incentives should be
done in order to monitor the changing nature of the work force towards improving
employee performance.
TABLE OF CONTENTS
Title Page
Certification
Dedication
Acknowledgement
Table of Contents
Abstract
CHAPTER ONE
1.1 Background of Study
1.2 Statement of Problem
1.3 Purpose And Objective of the study
1.4 Research Question
1.5 Research Hypotheses
1.6 Scope of the Study
Operational Definition of terms
CHEATER TWO LITERATURE REVIEW
2.1 Historical Background of the study
2.2 Theoretical Framework
2.3 Benefits of compensation to an organisation.
2.4 Current Literature Review
CHAPTER THREE RESEARCH METHODOLOGY
3.1 Characteristics of the study population
3.2 Sampling procedure
3.3 Research Design
3.4 Data Collection Instruction
3.5 Standardization on instrument
3.6 Scoring and data collation
3.7 Statement of Hypothesis
3.8 Data Analysis Technique
3.9 Limitation of the study
CHAPTER FOUR
4.1 Introduction
4.11 Presentation and Analysis of data
Test of Hypothesis
CHAPTER FIVE
5.1 Summary of Findings
5.2 Conclusion
5.3 Recommendation
References
Appendix
CHAPTER
ONE
1.1 BACK GROUND OF STUDY
Developing the compensation package of an organization is a
complex and continuous assignment of the personnel department. This possibly
accounts for the reason why all personnel department structures, whether for a
small or big organization, each has a section a signed with the function of
ensuring that people are fairly and adequately remunerated.
Compensation therefore refers to the payment of fair and
adequate remuneration to employees.
Direct compensation
refers to money paid to a worker for his performance of his
job assignment Le salaries and wages, while.
Indirect
compensation includes incentives,
fringes benefits and other kinds of benefit paid to workers.
Incentive are there fore rewards (outside salary or wages)
which are given to an employee with the aim of motivating or stimulating him to
work harder.
However salary/wages are used to attract employee and they are
money paid for work done (Burack and Smith) stress that an incentive scheme is
a plan or programme to motivate individual or group performance. An incentive
programme is most frequently built on monetary rewards e.g. bonus or incentives
pay but it may also include a variety of non‑monetary rewards or prize. It
includes many kinds of inducements offered to employees to make work even
beyond acceptable standards and time.
This research work will look at the development of incentive
schemes which is a sub‑function of the personnel department. However it must be
discusses that incentives are paid of a motivation system this great emphasis
will be laid on motivation with incentive being a contribution to motivation.
1.2 STATEMENT OF
PROBLEM
The use of incentives in organization or industries today has
become increasingly essential considering the dynamic nature of the business
world. There are a number of reasons. The first is an economic. Economic
theories of Benefit and Compensation. Administration, Wages are strictly on the
down side when the company faces, hard times it is hard or impossible to lower
the wages of current employees. In this way wages become a fixed. Cost. The
only way, the employer has to lower this cost is to layoff workers for the past
twenty years, this has been a way of life for American business. Incentive pay
can soften this necessity to lay off members of workers by lowering the wage
bill for all workers to some degree.
A second reason is continued in the “payment for results or
performance” concept if the company relates pay to the desires outcome then
this will increase the probability of obtaining that outcome. This may be
through the employee working smarter faster or longer. As companies have laid
off employee they have had to become learner and more efficient. Getting more
accomplished with fewer people makes the promises of incentive pay very
attractive to companies today.
Third, as union influence, has declined and the ideas of
participate management has spread, there is a significant desire to tie the
employees into, not only doing better on their job but being interested in how
well the total organization is doing, including contributing to the overall
company success some incentive pay plans focuses, mainly on trying to get the
employee to join with management to create a successful company. Therefore
there is every need to motivate workers in order to increase their productivity
and performance for attainment of overall organizational objectives such as
profit sharing holiday premium job enrichment flexible work hours.
Profit sharing: Is another popular organization‑wide program
that is often classified as gain sharing plan. This type of plan can be made
much more simple than a cost sharing plan. Nor does it requires the revolution
in employee‑ management relationships that cost‑savings plans do with profit
sharing, management hopes to change employee attitudes toward the employee. The
idea behind profit sharing is to instill in the employee a sense of partnership
with the organization. But most plans go beyond this and use profit sharing as
a way to keep valuable employees and to encourage thrift in employees.
Clearly the relationship between effort and performance
becomes very tenuous in any organization ‑wide incentive plan. Even if the
performance (profit or cost savings) and the reward (an amount of the profit or
savings based on salary) are clear, their connection with what the employee
does every day is not clear. Infact, most organization ‑ wide plans fit the
membership model better than they do the performance motivation model.
This enhanced membership motivation appears to be the greatest
strength of profit sharing. The profit sharing objective of instilling a sense
of partnership is met to the extent that employees want to continue their
membership and to make the additional contributions that enhanced membership
implies.
1.3 PURPOSE AND
OBJECTIVE OF THE STUDY
The major objective of this study is to investigate the impact
of incentive plans on employee performance. This study will also identify
various ways of implementing incentive plan for improved employee performance.
However the specific purpose of the study are to
i. To ascertain if
employee performance would be increased through good working condition as
incentive.
ii. To determine if the provision of benefit
packages as incentives would lead to personal satisfaction and sense of
accomplishment this leading to improved employee performance.
iii. To determine if the rewards of superior
work of employees as an incentive would improve performance.
iv. Determine if junior worker would improve
their performance if there are mechanisms for comments, suggestions grievances
as a way of motivating them.
v. Ascertain the specific types of
incentives workers want.
vi. Highlight the specific problems
encountered by personal departments in the use of incentives as a motivational
tool.
vii. Proffer
solutions to the problems highlighted above.
However in identifying various ways, of implementing incentive
plan for employee motivation must first be considered. Motivation fundamental
Element in employee performance the job of a manager in a work place is to‑ get
things done through employees. To do this the manager should be able to
effectively motivate them. But, that is easier said their done. No employee
ever get up in the morning and said “I am going to work really hard today
because I've got health insurance” Yet an employee could have no difficulty
giving extra effort for a manager who shows a level of trust and respect,
commitment and support on a daily basis and in a timely sincere and specific
way, such as through an incentive program.
Motivation is also a very personal element. What motivates
people varies from person to person and it varies over time with the same
person. For this reason, how to motivate employees is a moving target. Research
however indicates that, regardless of the size or types of business, the best
motivation is manager‑initiated and based on performance. Performance is
considered a product of both ability and motivation.
Ability, dependent on education, experience and training, can
be a show and long process. Motivation however, can be improved quickly through
a varity of influential strategies motivated employees don't happen by accident
an organization has to have a plan to reinforce the behaviour that they want.
It is important to remember that employees are people. And, people will usually
do what they want to do or otherwise. Motivated to do so.
Motivated employees tend to reach their full potential and
encourage co‑workers with their enthusiasm and passion to reach new heights.
1.4 RESEARCH QUESTIONS
In order to achieve the purpose of this research work, there
would be an attempt to provide answers to the following research questions:
i) Would employee performance be increased
if there are good
working
conditions as incentives towards personal satisfaction?
ii) Does the provision of benefit packages as
an incentive lead to personal satisfaction and a sense of accomplishment thus
improving employee performance.
iii) What specific problems do personnel
department is encounter in the use of incentives as a motivational tool?
iv) Would junior worker's performance be
increased if there are mechanisms for comments, a suggestions grievance as a
way of motivating them?
v) What specific
types of incentives of workers want in order to improve performance.
vi) Does the reward of superior work as an
incentive lead to improved employee performance having achieved personal
satisfaction.
1.5 RESEARCH
HYPOTHESIS
In an attempt to investigate the impact of incentives on
employee performance, the following hypotheses were tested
H1 That good working condition as an incentive
improves employee performance in male workers than in female workers.
H2 That good working condition as an incentive
improves employee performance in male workers than in female workers.
H3 That the provision of benefit packages an
incentive would lead to personal satisfaction thus improving employee
performance in junior staff more than in senior staff.
1.6 SCOPE OF THE STUDY
Organisations abound in every from whether large or small,
sole proprietorship or partnership or public liability company. This fact
reveals that attempting a research work to cover every organization is not only
Herculean but totally impossible hence there is needs to draw out an area of
study which this becomes the scope of the study.
For this research work therefore, the scope shall be a union.
Bank Nigeria Plc branch operating in Lagos
State of Nigeria. This
branch has at least 10 senior staff and at least 40staff of junior rank.
1.7 RELEVANCE OF THE STUDY
The relevance of this research is to make a theoretical and
practical contribution to organizations on the impacts and importance of intensive
plans on the performance of employees.
The study will also provide useful contributions to
organizations on how to motivate their employee towards improved performance
for efficiency in the every dynamic business world. Emphasis was laid on trying
to identify the reaction of employees towards certain incentive plans while
also trying to pin-point the exact incentives that workers want.
OPERATION
DEFINATION OF TERMS
For effective communication, it is pertinent to operationally
define some of the salient concepts in this study.
INCENTIVES: These are rewards (out side salary and wages) which are given
to employee with the aim of motivating or stimulating him to work harder.
INTRINSIC
INCENTIVES: These are incentives
that are non-monetary in nature i.e job enrichment participation in decision
making etc.
EXTRINSIC
INCENTIVES: These are incentives which are
monetary in nature i.e pay for time not worked.
SHORT TERM PLANS: Those are incentive plans which are based on output be
increased production.
LONG TERM PLANS: These are incentives plan which are based on group
performance out-011-t
EMPLOYEE
PERFORMANCE: This is the amount of
work done by a worker or an individual in an organisation.
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