FINANCIAL AND NON FINANCIAL REWARDS

Financial and Non Financial Rewards

Financial and Non Financial Rewards

Introduction

This study examined the impact of financial and non financial rewards, results (profit, customer service, employee turnover) on the organizational performance. The results show that both types of bonuses have a significant impact on all measured outcomes. Initially, monetary rewards have had a greater effect on the results, but longer term the two types of bonuses had a corresponding impact except in regard to the turnover. It seems that research examining the use of bonuses as motivators lacking at present. This is despite the fact that this analysis is crucial for organizations that wish to maintain their competitive advantages in terms of profitability, quality of customer service, and consistency of employees (to avoid too frequent changes of personnel). The purpose of this study is to use multiple criteria to analyze how financial and non monetary incentives rely on the performance of units under study.Literature Review

Individual performance at work is reliant on the reward system of the organization. Premiums are effective when used judiciously. We also believe that rewards influence the collective behavior, which improves the results of the groups. As early as 1964, Argyris argued that in practice, the compensation justified, the feedback systems and participative management, the organization led to actual results. But whether or not the premiums are beneficial depends mainly on how they managed by managers and supervisors.

Research Question

What is the balance of motivation between financial rewards or non financial factors?

Financial Rewards

The money is attractive, it is obvious, and it proved that he was acting in enhancing performance. When it used, it has an inordinate effect. It is the fact that it can be exchanged against any other valuable result (goods, services, privileges). Although several forms of bonuses are available, (good gift, vacation pay) lump-sum bonuses are becoming more common. To be effective, it must on the one hand, they arrive as soon as possible after the performance, and secondly, if they relate to a group, they constitute a pattern of distribution.Non-Financial Rewards

They are most often associated with the recognition and feedback. Note the difference between recognition and social recognition: Recognition refers to the formal practices such as "Employee of the Month" or "prize for the best seller". Social recognition is a more casual turn: attention, approval, appreciation, and praise. 90% of managers believe that informal recognition helps motivate employees. It also appears that feedback has a greater effect for future tasks that social recognition. For feedback to be effective it must: it brought in a positive way, it is immediate that it represented visually (charts) and are specific expectations for performance. So we will combine the feedback with the social recognition to measure the effects.

Methodology

In order to find out the proper research, following methodology has been proposed. We have taken the data from 30 originations, every organization we would take in our research has an average has of two managers and 25 subordinates. This study would use a quasi-experimental design; three groups formed to study

1. Financial (where one group uses monetary bonuses) ...