Pay and Motivation

Motivation is important because workers want to feel valued and that they're doing their jobs well. Motivated staff are good for business... why?

• Perform better
  • Produce more and better-quality products
• Stay with the company for longer
  • Reduces staff turnover
  • Saves money
    • Firm spends less on recruting and training new employees
• From within
  • Employee inspired
  • Wants to work hard and improve at their job

Authoritarian or autocratic

• Managers make decisions alone without consulting staff. Workers must simply obey orders.
• Can make workers feel they are not valued and demotivate them
• Can be effective during crisis management

Paternalistic

• Managers make decisions themselves, but only after consultation with workers

Democratic

• Managers allow workforce some influence over decisions

Laissez-faire

• 'Leave to do'
• Managers allow workers to perform tasks as they see fit, offering help when needed
• Good for independent workers, bad for staff who need support

Autocratic

• Quick decision making
• Effective when employing many low skilled workers

Paternalistic

• Workers feel their social needs are being met
• More two-way communication so motivating

Democratic

• Useful when complex decisions are required that need specialist skills
• Authority is delegated to workers which is motivating

Laissez-Faire

• Can be very motivating for highly skilled workers
• Workers allowed to make own decisions

Autocratic

• No two-way communication so can be de-motivating
• Creates "them and us" attitude between managers and workers

Paternalistic

• Still rather autocratic
• Slows down deision making

Democratic

• Mistakes or errors can be made if workers are not skilled or experienced enough

Laissez-Faire

• Creates a lack of cohesiveness within the group as managers appear withdrawn
• Very little guidance so workers may make mistakes and projects may go off task

Training

• Help staff become better at their jobs
• Being good at your job will improve self-esteem
• Trained to learn new skills
  • Take on new tasks
  • Prevents boredom and frustration
• Help staff to meet personal targets to reach self-actualisation

Environment

Conditions affect quality of performance

• Safe
• Warm
• Light
• Comfortable

E.g open plan offices, music, staff rest areas.

Maslow believed all people motivated by the same things. The three lower needs must be achieved before two higher needs can be met. 
http://www.researchhistory.org/wp-content/uploads/2012/06/maslows-hierarchy-of-needs.gif

• Physiological/physical survival
  • Food, water, rest, excretion, shelter + clothing
  • Canteen or vending machines, water fountain, breaks, toilets, basic wage
• Safety
  • Safety of body, employment, health
  • Safety equipment, contract of employment, healthcare insurance
• Love/belonging
  • Company of others
  • Social clubs, staff rooms, award schemes, uniforms, teams
• Esteem
  • Feeling valued by others
  • Award schemes, promotion, praise, job enrichment, job title
• Self-actualisation
  • Feel they are achieving 
  • Challenging responsibilities, appraisal e.g. development plans and training

Wages

• Time rate
  • Worker paid set sum per hour worker
  • Best when measuring output is difficult
  • Encourages to work long/set hours
  • May have incentive to work slowly
• Piece rate
  • Paid sum for each item completed
  • When measuring output is easy e.g. factory worker
  • Encourages to work quickly
  • Quality may suffer if they work too fast

Salary

• Fixed amount paid a month (yearly income /12)
• Both employee and employer know exactly how much the pay will be
• Does not link pay directly to performance

Performance related pay (PRP)

• Amount earned depends on how well they work
• Commission
  • Paid to workers who sell goods or services
  • Small basic salary + more money for each item sold
  • Amount paid calculated as a percentage of the value they sell
  • Motivate to sell more
  • Can be too pushy and put off customers
• Bonus
  • Extra lump sum added to pay usually once a year
  • Individual or group, when they reach performance targets
  • If target unrealistic, workers may not try to work towards it

• Profit-sharing
  • Paid share of profits made by firm
  • Where individual contribution of workers cannot be measured
  • Some workers may not deserve payment
• Overtime pay
  • TIme rate increased to persuade extra hours
  • Paid at time + 1/4 or time + 1/2
  • Costs firm more but possibly covered by extra sales

Temporary workers

• Paid for a fixed period of weeks or months
• Freelance workers are temporary, usually self empolyed
• To help with a particular task
• Flexibilty- extra staff for a short time for work needed to be done
• Workers may not feel committed so not motivated

• Fear
  • Threats
    • Scolding, being sacked
  • Not good in the long run
    • Intimidated, threatened workers change jobs or involve trade unions
    • Casues resentment
    • May not contribute
• Job Rotation
  • Different jobs during a period of time
  • Prevents boredom
  • Learn to do different jobs
    • Be able to cover
  • May move from one unsatisfactory job to another
• Job enlargement
  • More and varied tasks to do, but no more responsibility
  • Increase size of job description
  • Job more varied and interesting and more valued
  • More work can be demotivating

• Job enrichment
  • Greater responsibility e.g. supervising
  • More training
  • Motivated and work harder
  • May expect a pay rise too
• Fringe benefits/perks
  • Any reward not part of a worker's main income
  • Costs less than income rewards
  • E.g. company car, gym membership, health insurance
• Award schemes
  • e.g. 'Employee of the month' certificate
  • Hard work recognised
  • Can improve self esteem