Does rewarding affect motivation in engineering and manufacturing organizations?

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TABLE OF CONTENTS

CHAPTER 01: INTRODUCTION1

Background of the Study1

Aims and Objectives6

Research Questions6

Significance of the Study7

Layout of the Dissertation7

REFERENCES9

CHAPTER 01: INTRODUCTION

Background of the Study

For the success of any organization employee motivation is extremely important and one approach has been to provide monetary and non monetary rewards and recognition to the employees. Employees may however be motivated by both intrinsically and extrinsic factors. The concept that incentives influence both intrinsic and extrinsic motivation is an expansion of motivational theories that recognize that employees have needs that must be fulfilled in multiple ways. The challenge for organizational leaders is to determine which factors will create the highest level of motivation. Extrinsic factors are tangible rewards given to employees based on their performance of specific tasks or on their behaviors (Joinson, 1999, pp. 86).

Extrinsic factors can include compensation, company stock, merit bonuses, benefits, and promotions. Intrinsic factors are rewards that employee receives internally that are associated with performing a task or activity. Examples of intrinsic factors are: feelings of responsibility, positive interactions with others, opportunities to learn new skills, recognition, levels of challenge and engagement, and having a work environment that is interesting and challenging. Of all the functions that managers perform, motivating employees to work to their highest level of performance may be the most complex and difficult task due to the fact that outside influences can affect motivation.

Firms constantly make decisions that affect the conditions of work for their employees.

For better or for worse, rewards have staunchly embedded themselves into the fabric of our culture and society. Indeed, when problems presumed to be motivational in nature arise, particularly those in the organisations, turn to crude methods of motivation such as extrinsic rewards. The use of rewards and reward systems are very common in organisations. Managers frequently use systems of rewards in order to promote appropriate behaviors and to increase productivity of the organisations (Joinson, 1999, pp. 86).

Both basic and applied research studies have been conducted to examine the effects of rewards on intrinsic motivation, competence, autonomy, and achievement. By definition, basic research seeks to understand the theoretical basis of specific phenomena in more controlled settings whereas applied research seeks to examine the phenomena in more naturalistic or less controlled settings. Information gathered from basic and applied research studies on rewards and specific variables (i.e. intrinsic motivation, achievement, etc.) have added valuable information to the field of motivational psychology. Nevertheless, there are numerous shortcomings within this body of research on rewards, most significantly related to the issue of settings and field studies.

Kahn & Byosiere (1992) study suggests that performance increases in extrinsically motivated situations where reward is contingent upon total performance. The study, however, was limited to an examination of the effects of reward contingency on performance and did not measure either intrinsic motivation or performance when the rewards were removed (Kahn & Byosiere, 1992, pp. 537).

Retaining and motivating front-line employees (employees who are not in a managerial type of position, whose duties include operating ...