Unit 2.1: Motivation

www.igcsebusiness.co.uk

Why do peoplework?
Affiliation

1. Financial Rewards
2. Non-Financial Rewards
3. Introducing ways to give job satisfaction
It is the responsibility of
management to make sure that
their employees aremotivated…
they do twhwawt.ivgciasetbhurseineesms.caoi.nukways:

Pay may be used to give an incentive to employees to
encourage them to work harder or more effectively.
There are a few ways to offer incentives…
Pay may be seen as a main reason for working, but
there areowthwerww.aigysctsoemboutsivianteesems.pclooy.ueeksas well.

I. Wages
Time Rate Piece Rate
• Paid every week.
• Worker gets paid on a regular basis.
• Does not have to wait long for some money.
• Tend to be paid to manual workers.
• If the employees work longer than their normal time, they will be
paid overtime. This is their regular amount plus an extra amount.

I. Wages Time Rate
 This makes it easy for
calculation (for both workers
and employees). The hours are
recorded on a time sheet
which must be filled in and
used to calculate the wages.
× This system takes time.
× Good and bad workers are paid the
same amount of money.
× Supervisors need to keep constant
track of the workers.
× Expensive because more supervisors
are needed.
× Also, a clocking-in system is needed to
www.igcsebusinesds.ecot.eurkminethe numberof hours.
• This ispaymenwtbwytwhe.ihgoucrs(feorbaupesriiondeofstism.ec)o.uk
• Example: If the employee works 40 hours and is paid $10 per hour,
he gets $400 a week.

I. Wages
• This method of payment is best used when it is difficult to
measure the output of the worker. (bus driver or receptionist).
Time Rate

I. Wages
• This is payment that depends on the number of products the
worker has produced; the more they make, the more they get paid.
• Abasic rate is paid, plus any additional money that are a result of
additional item produced.
• Can be applied to a bonus system.
• This method can only be used where it is possible to measure the
performance of an individual or a team.
Piece Rate

I. Wages Piece Rate
 It encourages workers to work
faster and produce more
goods.
× Quality could be ignored, therefore low
quality goods produced will lead to a
low level of sales.
× Requires very high level of quality
control which is expensive. If poor
quality is produced, it could damage
the reputation of the business.
× Workers who are careful in their work
will not earn as much as those who
rush, which may not be seen as fair.
× If the machinery breaks down, the
employees will earn less money.

II. Salaries
• Paid monthly, normally into a bank account and not in cash.
• It is for office staff or management.
• Asalary is calculated as an amount of money per year and is
divided into 12monthly amounts.
• It is paid for the job and extra work is not usually paid for – it is
counted as part of the salary.

II. Salaries
Commission
Share
ownership
Profit
Sharing
Performance
-related pay
Bonus
• Salaries are usually a standard rate, i.e. a set amount of money.
• Workers may get more money if the following rewards are added
to the basic salary.

II. Salaries
• Often paid to sales staff.
• The more sales they make, the more money they are paid.
Commission
 Sales will increase because the
sales force want a commission.
× If the sales force are too persuasive and
encourage people to buy things that are
not needed, it will increase sales in the
short-term only.
× This may cause the business to develop
a bad reputation.
× It can also be stressful for the sales staff
because if they have a bad sales month,
their pay will decrease.

II. Salaries
 Motivate the people to work
hard as they receive a share of
the profits.
Profit
Sharing
• Employees recweivweawsh.aigrecofstehebiruprsoifnitseinsasd.dcitoion.utoktheirbasic
salary.
• The rest of the profits is given as dividends or retained profit.
• Often used in the service sector.

II. Salaries
• Alump sum paid to workers when they have worked well.
• It can be paid at the end of the year or at intervals during the year.
Bonus

II. Salaries Performance
-Related Pay
• Pay is linkedtwotwheweff.eicgtivcesneessbouftsheinirewosrks..co.uk
• Used when output cannot be readily measured.
• To assess their performance, businesses often use a system of
appraisal.
• An appraisal is where an employee’s immediate superior observes
their work, talks to the worker’s colleagues and then carries out an
interview with the employee to discuss their progress and their
effectiveness.
• Training needs may be identified at the appraisal interview and
this should help to improve the employee’s effectiveness in the
future.

II. Salaries Share
Ownership
 Encourage them to work hard as they will receive dividends if the
company doeswell.
 Also, the share price will increase if the company is doing well and
so increase the value of their shares.
 May improve employee loyalty, as they will have a greater sense of
being part of the company.
• Employees arewgiwvenwso.imgecshsaerebsiunsthienceomspsa.ncy.o.uk

• These are called the perks or fringe benefits of a job.
• These may include:
• Children’sweduwcawtio.nigfecesspeaibdusiness.co.uk
• Discounts on the firm’s products
• Health care
• Company car
• Housing allowance
• Share options
• Expense accounts
• Pension plans
• Free trips/holidays

• Job satisfaction is the enjoyment derived from feeling
that you have done a good job.
• Individual emwpwlowye.iegschsaevebduisffienreenstsm.ceoth.uokdsof
thinking what is important and what will get them to
be satisfied.
• There are several way in which a business can increase
the job satisfaction of its employees.
1. Job Rotation
2. Job Enlargement
3. Job Enrichment

1.JobRotation
• Involves the workers swapping round and doing each specific task
• This increases the variety in
the job.
• Makes it easier for people to
cover others if they are ill or
not present.
• It does not make the task itself
more satisfying, however.
for only a limiwtedwtiwme.aigndctsheenbchuansgiinngersousn.dcaoga.iun.k
• It does not make the task itself more satisfying, however.

2. Job Enlargement
• Extra tasks of a similar level of work are added to a worker’s job
description.
• This gives more variety to the work, but no extra responsibility,
and so can increase job satisfaction.

3. Job Enrichment
• Looking at jobs and adding tasks that require more skill and/or
responsibility .
• Additional training may be needed for the employee to take on
extra tasks.
• This will also increase the job satisfaction of the employees since
they have a more fulfilling job.

4. Autonomous work groups/Team working
• When a group of workers are given responsibility for a certain task
together.
• Employees will work together, share more ideas and become more
committed to the task.
• This will often lead to both job rotation and job enrichment,
leading to overall job satisfaction and positive spirit.

Styles ofLeadership
There are different approaches to leadership that are
adopted and these can be summarized in three main
leadership styles.
1. Autocwrawticwlea.idgercshsiepbusiness.co.uk
2. Laissez-faire leadership
3. Democratic leadership

Styles ofLeadership
1.Autocratic Leadership
www.igcsebus-inTheemsasn.acgeore.xupekctsto be in charge
and to have their orders followed.
- They keep themselves separate from
the employees, make all the decisions
and keep information to themselves.
- They tell employees only what they
need to know.
- Communication is only one way;
downward or tap down.
- The workers have little or no
opportunity togive feedback.

Styles ofLeadership
2. Laissez-faire Leadership
www.igcsebus-inTheississFr.ecncoh.fuork‘leaveto do’.
- Makes the broad objectives of the
business known to employees, but then
they are left to make their own
decisions and organize their own work.
- Communication can be difficult in this
type of organization as clear direction
will be given.
- The leader has a very limited role to
play.

Styles ofLeadership
3. Democratic Leadership
www.igcsebus-inTheisstyspe.cofole.audekrshipwill get
employees involved in the decision-
making.
- Information about future plans will be
openly discussed before the final
decision will be made, often by the
leader.
- Communication flows both upwards
and downwards.

Unit 2.1: Motivation

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Unit 2.1: Motivation