Payment Systems: Control and Commitment in Newton’s Ingredients: Employee Motivation

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Motivation is brought about by a number of factors, both intrinsic and extrinsic. Intrinsic motivation is an individual’s desire to carry out a particular task and the satisfaction they get from doing or completing it. Extrinsic motivation arises from the benefits or rewards one gets for completing a given task, or the penalties for not doing so correctly. These include salary, bonuses, working hours, working conditions and promotions. The new scheme aims to motivate employees by offering a reduction in the number of working hours per week, an increase in wages, change to the way in which wages are currently paid and offering them work in areas other than their main discipline. Most of these are extrinsic motivators and while intrinsic motivation is much more effective than extrinsic motivation, it is definitely an advantage to the company to motivate employees as much as possible.

‘The Carrot and the Stick Approach’ described by 19th Century philosopher, Jeremy Bentham, says that motivation can be achieved using a system of rewards (the carrot) and penalties (the stick). The new wage-payment structure in the company can be regarded as ‘the carrot’. Promotion to higher pay grades will be an incentive for employees to carry out their jobs as effectively as possible. Requiring employees to carry out certain tasks outside their main discipline could be regarded as ‘the stick’. Failure to demonstrate sufficient knowledge in these tasks would reduce their chances of being promoted to higher pay grades and so would encourage them to acquire these additional skills.

The ‘Motivator-Hygiene Theory’ put forward by Frederick Herzberg claims that while certain factors such as recognition and responsibility may increase motivation (motivators), others such as company policies, job security and wages (hygiene factors) may not necessarily do so. However, changes to these ‘hygiene factors’ could lead to employees becoming dissatisfied with the job and therefore losing...
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