2.5.4 Motivation

motivation

• reasons for acting/behaving in a particular way

• → e.g. the business motivated the workers so they’re more productive

Why is motivation important in the workplace?

• retains employees

• to attract more employees

• increased productivity

retains employees

• means employees stay with firm and don’t leave

• reduces recruitment costs as not needing to fill as many posts

• staff are in posts, not absent and working → increased productivity

• retains experience in firms

increase productivity

• productivity = amount produced per person per hour

• staff get more work done in the given time

• → increases efficiency which reduces average costs per unit → increases profit per unit

• or → firm could lower price to be more competitive

to attract more employees

• firm has reputation for supporting staff which means people will want to work there

• more likely to attract experienced good quality candidates

• more likely to get best person for the job

Financial ways businesses motivate employees

• remuneration (pay)

• promotion

• bonus

• commision

• piece work

• fringe benefit

• expensive → adds to costs

effects of financial ways businesses motivate employees

• the more you pay your members of staff the more motivated they are to work for the firm

• if receiving high salary money may not be big motivation

promotion

• increased earning

• increased loyalty

bonus

additional payment given out when performance targets are met

commision

receives a percentage for every sale made

fringe benefits

• perks/benefits given by company and not government issued

• e.g. free healthcare, gym membership, company car, company devices

non financial methods of motivation

• job rotation

• job enrichment

• autonomy

• cheaper

job rotation

• moving employees around from task to task

• keep them interested and motivated

• though employees don’t get chance to build experience in one area

• may just be moving from one boring task to the other

advantages of job rotation

• relieves boredom

• easy to find an employee to cover absent colleague

• more motivated due to wider range of skill

disadvantages of job rotation

• training costs are high

• fall in input due to less specialisation

• could be greater number of boring task with less benefits due to changing groups

job enrichment

• employees are given resigned jobs that have more challenge and are less repetitive and boring (given more responsibility

advantages of job enrichment

• develops unused skills and challenges employees

• allows employees to contribute to decision making process

• increased feeling of achievement

disadvantages of job enrichment

• some employees feel under pressure

• costly to redesign jobs

• benefits only when thinking long term as employees have to be trained

• not all jobs can be enriched → e.g. refuse collectors/rubbish removal

autonomy

• allowing employees to make their own decisions

• e.g. teachers can decide when to mark

advantages of autonomy

• employees feel more ownership of their own work and so are more motivated

• employees able to use their own thinking skills to complete their work at their place/pace

Explain one reason why a business may decide to pay its workers a bonus (3)

• increases motivation

• feel like their hard work is being appreciated

• they’ll feel valued and motivated to perform better

Explain one drawback to a business of not being able to retain its employees (3)

• spend more money on recruitment and training costs

• cost the expertise of previous employees

• will now have to spend money to replace them