Are Monetary methods of Motivation Effective?
Evaluate that monetary methods of motivation are more effective than non-monetary methods of motivation:
Monetary methods of motivation have been around for quite a while, firstly with the introduction of Taylor’s Scientific Management theory where he believed that workers can be treated like any other resource such as a machine, he also believed that workers only went to work for their own economic gain (pay) and so by increasing pay through incentives etc a business may motivate workers through their process.
Monetary methods of motivation I do believe to be successful in motivating workers, I especially like the idea of ‘piece rates’ where workers are paid according on how much they produce (output). This would give a worker an incentive to work harder. This has been implemented in many industries where division of labour has been in place where a job will be broken down into lots of different jobs and a worker would repeat a task over and over again, this can lead to specialisation. I feel that this monetary method can be effective with output increasing but the business may see an increase in rejects and the quality of the product falling. – This method of motivation was first implemented by Henry Ford.
There are also many other methods of monetary motivation which businesses use such as bonus’ and commission based incentives where workers are paid on their output in the work place, usually in sales – how many sales they get, percentage of sales etc. I feel again this is an effective way of motivation as it would give workers an incentive to close a few more extra sales, of course the negative side of this maybe pushing products that consumers don’t want. (More product oriented instead of market oriented). Maslow and his hierarchy of needs also believe that a good level of pay is essential in motivation.
So far we have looked at the different monetary strategies which businesses use to motivate its workers but in real life businesses need to know that workers are not like any other resource and that they have more complex needs. There’s only so much extra pay a worker will continue to work before it becomes natural and the incentive is taken away. That’s one of the other problems associated with monetary motivation is that businesses will have to continue to pay slightly higher increases every-time to continue to motivate, otherwise the effect will wear off and it just becomes useless and costly to a business who will eventually see their workers becoming de-motivated again.
According to Hertzberg and his two factor theory of hygiene and motivation factors, pay is actually on the hygiene side of his theory. Hygiene factors are those which workers expect to have before stepping foot in the workplace, these include a good level of pay, amongst a good safe working environment etc. He believes needs are more complex for workers and so in order to motivate workers a business must give opportunities to advance and give out more responsibility via empowerment, – allowing workers to make decisions for themselves etc. – This goes against Taylor’s theory where he believes it’s the manager’s job to manage and tell workers what to do. Even Maslow had other motivational factors other than just monetary.
To conclude: Monetary methods of motivation can be very successful, especially in those industries such as the manufacturing of goods and those that incorporate division of labour and specialisation via piece rates, but I also feel that ‘once size’ doesn’t fit all and that people have more needs other than pay. Workers have social needs and a sense of belonging in a business; a lot of workers want to feel a self of achievement through self actualisation.
