MONEY’S ROLE IN MOTIVATION IN TODAY’S CONTEXT
For many years, money has been considered a strong motivator that
influences employee satisfaction and performance. Financial incentives are a
common tool used in human resource management (HRM) practices to encourage
staff members to work towards company objectives. The role of money in
employee motivation in today's dynamic workplace is a topic of great interest.
Using anecdotes and research, this blog examines how financial incentives
affect employee motivation.
Financial Rewards and Employee Motivation.
Financial rewards like bonuses and pay increases are important sources of motivation for employees all over the world. A study conducted by Maheesha and Perera (2018), found that financial incentives are highly valued in the Sri Lankan context by employees, often leading to increased job satisfaction and improved performance.
Impact
on Job Performance.
Employee performance can also be impacted by money. Employee effort and
productivity can be raised via incentive pay schemes, such as
pay-for-performance or incentives linked to individual or team objectives
(Lazear, 2000). This was supported by a study conducted by Gerhart and
Milkovich (1990), which found a favorable correlation between incentive
compensation and worker performance. Furthermore, a study conducted by Shibly
and Weerasinghe (2019), in the Sri Lankan context, found that employees who
earned larger bonuses were more driven to meet their goals, which enhanced
performance.
Perceptions of Fairness.
We know that performance can greatly be impacted by money. Employee
efforts and productivity can be raised via schemes such as pay for performance,
or incentives linked to individual or team objectives (Lazear, 2000). Even
though financial incentives are important in the path of motivation, a study
conducted by Edirisooriya (2014), based on the Sri Lankan context shows that
failure to be fair in the distribution of the rewards will result in employee
demotivation. Therefore, HRM practices must ensure that monetary rewards are
distributed fairly.
(Ariely, 2009), What Makes Us
Feel Good About Our Work?
(This talk
discusses the psychology of motivation, including the role of money).
Conclusion.
In conclusion, in the modern workplace financial compensation plays a major
role in employee motivation. However, to sustain employee motivation and
happiness, HRM strategies should carefully craft financial incentives that are
in line with organizational objectives and guarantee fairness.
Reference.
Ariely,
D. (2009). What makes us feel good about our work? [TED Talk]. TED Conferences.
Available
on: https://www.youtube.com/watch?v=5aH2Ppjpcho
[Accessed
on: 22.03.2024.]
Gerhart, B., & Milkovich, G. T. (1990). Organizational differences in managerial compensation and financial performance. Academy of Management Journal, 33(4), 663-691.
Lazear, E.P., 2000. Performance pay and
productivity. American Economic Review, 90(5), pp.1346-1361.
Maheesha, &. G. P., 2018. The Impact of Incentive Programs on Job Performance: A Study of Office Employees in Selected Manufacturing Companies in Colombo District, Sri Lanka. Human Resource Management Journal,, 6(2012-7227).
Available
on: https://shorturl.at/bmoY5
[Accessed on: 22.03.2024]
Edirisooriya, WA 2014, “Impact of Rewards on Employee Performance: With Special Reference to ElectriCo” 3rd International Conference on Management and Economics, Faculty of Management and Finance, University of Ruhuna, Sri Lanka
Available
on: https://shorturl.at/dmD29
[Accessed
on: 22.03.2024.]
Shibly, M., & Weerasinghe, T. D. 2019. Impact of
Financial Rewards on Work Motivation of Operational Level Employees: Evidence
from a Leading Manufacturing Organization in Sri Lanka. Sri Lanka Journal of
Advanced Social Studies, pp. 01-17.
Available
on: https://shorturl.at/gprtP
[Accessed
on: 22.03.2024]
Maoney plays a major role as a human inducement in organisations and this blog covers how money can used in different ways to motivate human resource.
ReplyDeleteThis blog provides valuable insights into the complex relationship between financial incentives and employee motivation, emphasizing the importance of fair distribution in sustaining long-term engagement and satisfaction in today's dynamic workplace. It offers practical considerations for HRM strategies to optimize the impact of monetary rewards on organizational objectives and employee well-being.
ReplyDeleteThis blog provides a comprehensive examination of the role of financial incentives in motivating employees, highlighting their significance in enhancing job satisfaction and performance. It emphasizes the importance of fairness in reward distribution to maintain employee motivation and overall organizational effectiveness.
ReplyDeleteDue to the financial crisis we faced recently money and rewardings pay a major role in motivating the workforce. When employees are economically stable they tend to perform well within an organization. Perfect toips for the Sri Lankan HR context. Good Job!
ReplyDeleteAlthough intrinsic qualities like independence, purpose, and recognition are increasingly valued for building long-term employee engagement and satisfaction, money is still a powerful motivation in today's workforce.
ReplyDeleteorganizations need to find a balance between providing fair compensation and fostering an environment that prioritizes the personal development and well-being of its workers.
ReplyDelete