AN APPRAISAL OF THE RELEVANCE OF FINANCIAL INCENTIVES TO WORKERS MOTIVATION

 

(A CASE STUDY OF NATIONAL BOARD FOR TECHNICAL EDUCATION, KADUNA)

CHAPTER ONE

INTRODUCTION

1.1     Background to the Study     

In the word of Armstrong (1988), the process of motivation is initiated by the conscious and unconscious recognition of an unsatisfied need. A goal is then established which, it is thought will satisfy the need and of course action is determined that lead towards the attainment of a goal. Management should provide incentive schemes and pay workers on the basis of the result they achieve on the job instead of the more physical routine performance series activities and to retain them on their job making them feel satisfied, a motivationally-oriented wage system must adequately distinguish “Naira” wise between the different levels of efficiency for the people performing essentially job and different job categories and specialization.

In every organization, the management emphasis on high productivity, quality of services, quality workmanship, industrial peace, cooperative labour etc. On the other hand, employees need fair wages, job satisfaction, good working conditions, participation in decision making, self recognition and opportunity for advancement.

Organizations and managers have suffered tremendously in trying to utilize their human resources, they usually encounter frequent industrial conflicts and several unresolved agitations by workers and different categories of employees basically steaming from one form of dissatisfaction or the other. The main point of misunderstanding between management and employees/workers in most cases is found in the arrears of inadequate and inequitable monetary rewards.

Financial incentive as we all know is a process of guiding the conduct and influencing people so that they strives individual or group towards the achievement of group goals. Every employee comes to an organization with one motive, to earn a living and financial incentive play a vital role in the lives of these employees. Taking away financial incentive might jeopardize this individual or the group interest. Management on the other hand, established the organization for the purpose of return of investment and profit making, high productivity, quality of services, industrial peace, cooperative labour and to remain a going concern. Skinner B. F. (1953), states that by providing properly scheduled rewards is possible to influence behaviours.

The objective and purpose of this study is to examine whether or not financial incentives has contributed to workers performance and industrial harmony in National Board for technical Education. This research is by no means exhaustive but will help the establishment to take a second look that financial incentives has a significant role to play in maintaining industrial peace, increase productivity and boost the morale of the employees in an establishment.

It has generally been observed and noted that in a sample group of workers performing the same type of job, some do it better than others. This observation will raise and arouse the notion or questions or psychological tendencies, interest and differences in performance.  One school of though holds the view that “differences in performance reflect varying characteristics, abilities and skills on the part of ‘workers’. F.B. Skinner, (1985), an Industrial psychologist argues that differences in performance of workers doing the same kind of job,  might be as a result of extra monetary rewards attached to the job, conductive working environment or friends they meet in the workplace.

As a result of these possibilities, recognition and thorough understanding of workers needs/wants before adopting any form of motivational techniques such as financial rewards (money) human relations, conducive, working environment, leadership and good supervision among others, becomes apparently important since these factors has different influence and impact on different categories of workers and individuals.

The complexity of human nature, expectation, urges and drives/motives make the art of motivation of workers and employees a critical and complex point for consideration. A definite answer could not be reached since people differ in characteristics, background, traits, and needs. Thus it becomes imperative for the manager to incorporate positive motivational incentive programmes to motivate workers behaviour towards achievement of predetermine goals and objective of the organization.

Motivation is a very important issues in managing people. A happy employee is said to be a motivated employee. So it is important for managers, especially human resource managers to figure out what motivate an employee to excel at his/her work. Workers in any organization need something to keep them working. Most times the salary of the employee is not enough to keep him/her working for an organization due to economic factors and other variables. Sometime also just working for salary is not enough for employees to stay in the organization. An employee needs to be adequately motivated, the absence motivation scheme results to deteriorate in quality of work/performance either on individual or at corporate level. Even in conductive work environment it is generally observed that while some people work willing, others work very willing. The question then is what is responsible for people’s motives and attitude to work.

By definition, managers work with and through people to get things done. But people are complex and their motivations are not always easy to understand. It involves the unique feelings, through past experience of individuals as they share a variety of relationships within and outside the organization. Many theories exist about motivation and most of them differ in what they suggest managers should do to obtain the most effective performance from their employees. Most successful managers, however have learned by experience that people are generally very responsive to praise and encouragement-expressed not only in words but also in actions such as financial rewards-and they need to feel successful in their work in order to give their best effort to the organization. Managers who find the key to their employees’ inner motivations can tap an immense source of productive energy.

While motivation is essentially a personal experience, managers, in particular, should be keen to find reliable links between motivation and effective performance. They should also be concerned with creating the conditions under which organizational and personal goals may be harmonized. The key feature of motivation is that it determines the extent to which an individual desires to place his/her knowledge and skill at the disposal of others, and more than that to push off the effects of obstacles and difficulties in so doing. This project work examines the motivating power and relevance of financial incentive in boasting the performance of workers.

1.2     Statement of the Research Problem

The general concept of financial incentives is one form of motivating techniques and its indispensability for achievement of desired organizational goals and increase productivity and reward for performance has been a subject of controversy over the years globally generating diverse research arguments, criticisms and assumptions especially in developing country like ours.

Although many researches had been conducted on this concept, there are many avenues not yet explored and considered as per the complexities to the time understanding of what actually motivate the individuals in the work place. Organizations and managers have suffered tremendously in trying to utilize their human resources, they usually encounter frequent industrial conflicts and several unresolved agitations by workers and different categories of employees basically steaming from one form of dissatisfaction or the other. The main point of misunderstanding between management and employees/workers in most cases is found in the arrears of inadequate and inequitable monetary rewards.

One of the problems of workers in National Board for Technical Education is financial incentives which led to workers dissatisfaction and low productivity. It is evident here that the mode of financial incentives used by National Board for Technical Education has not been effective.

Secondly, there is correlation between financial incentives and workers

productivity in National Board for Technical Education which the

management is not implementing.

Thirdly, the problems militating against National Board for Technical

Education staff is financial incentives because there are not adequately

provided. Another problem is delay in paying those who have performed their

duties.

1.3     Research Questions

Even in most conductive work environment, it is generally observed that; while some people work willingly, others work unwillingly, the question then is what is responsible for people’s motive/attitude to work? As one psychologist puts it, “One of the most powerful positive tools that motivate people at work is financial incentives (money) at the prime stage.

To aid the research work, the following research questions were drawn;

-              What types of motivation or financial incentive do workers received at

National Board for Technical Education? 

-        Is there any correlation between financial incentives for workers and productivity in National Board for Technical Education?

-        What are the problems militating against financial incentives of staff of National Board for Technical Education?

-              How can these weaknesses be overcome to enhance motivation and

productivity National Board for Technical Education?

1.4     Objective of the Study

The objective of this study is to examine and highlight the negative impact of financial incentives to National Board for Technical Education staff. - It is expected that the findings of this research will be beneficial to policy makers, the Nigerian Public Sector and National Board for Technical Education.

-        To analyze the objectives of this research to know whether or not financial incentives are the highest/greatest motivators to workers performance in National Board for Technical Education.

-        The study is aimed at adding to the existing body of knowledge on the

subject matter and serve as a useful reference source for researchers in the field.

-        This study is not intended to find faults with any motivation techniques adopted by the National Board for Technical Education or negate the idea but to establish the effects and appraisal of financial rewards to their employees contribution in terms of productivity/efficiency being an indispensable management tool for achieving desired organizational goals and objectives.

1.5            Hypothesis

The hypothesis below were made in relation with stated problems and objectives of the study

          i.        Lack of financial incentives has been the major impediment to workers motivation in National Board for Technical Education.

          ii.       Financial incentive has been the major boost/influence to workers motivation in National Board for Technical Education.

iii.      Financial incentive can be considered by management as a indispensable tool for workers motivation in National Board for Technical Education.

1.6            Significance of the Study

Every organization in Nigeria today whether profit or non-profit oriented, is most concerned continuously with how to meet its organizational goals. A successful motivation strategy would result not only through the attainment of corporate objectives but through individual recognition or perceptions, aspirations, ability, skills and motives, desires and satisfaction. These of course, will also enhance increase in aggregate output level. Nigeria today moved far ahead from period when inducement or threat of any kind seen as effective tools of management for rapid development and growing economy.

          The researchers’ choice on the topic “Appraisal of the relevance of financial incentive to workers motivation” therefore emanates from the fact that early available research on the topic seems to have conducted based on developed nations with totally different socio economic, political and other background different from ours which to some extent still is under-affluent economy.

         

We have witnessed in the past few years in our industries, the increased rate of industrial disharmony (strike, lock-out etc) with frequent demand for higher wages more than other countries both in the public and private sectors respectively. This of course indicates that a lot is yet to be done in human resource management particularly in the aspect of employee’s motivation (Oshomole, 2007). This study therefore is meant to contribute to the unresolved controversy as to whether or not financial remuneration is a positive incentive in motivating human behaviour at work.

1.7     Methodology

For the purpose of gathering information for this research project, secondary method of data collection was used.

 

1.7.1. Sources of Data Collection;

The secondary methods of data collection was used. Secondary data was used by administered questionnaire on the staff of National Board for Technical

Education, Annual Report, Staff Manual, Workshop, Seminar papers,

Conferences, Paper presentation at NBTE floras and journals, Internets,

policy Papers among others were consulted.

i.                   Population and Sample Size

The total population and staff strength of National Board for Technical Education Kaduna constituted a population of 308 workers and this number served as the population and sample size of this study.

ii.                 Sampling Technique

A random sampling method was employed for this study whereby questionnaires was administered to a cross-section involving management staff, senior/junior staff of National Board for Technical Education in different Department/Divisions

iii.      Questionnaires Administered

Questionnaires was designed and administered to the different categories of National Board for Technical Education workers. Questions were intended to obtain information about the authenticity of the relevance of financial incentives in motivating National Board for Technical Education employees.

 

1.8     Scope and Limitations of the Study

This study is about the appraisals of financial incentives to workers motivation of National Board for Technical Education as a case study. The study therefore is limited to National Board for Technical Education only. In the course of carrying out this research work, the researcher encountered some problems among which are:

i.                   Accessibility to data

The researcher could not have full access to some of the information needed from the management due to the fact that the custodians of such information could not be reached.

ii.                 Time Wastage

Bureaucratic bottlenecks created a big problem because of continuous visit to the establishment due to unavoidable absence of people in the right position that gave birth to unnecessary time wastage and delays in completing the project work.

iii.      Financial Constraints

Much spending going up and down without contacting the appropriate personnel on seat, typing cost and increase in materials needed. Despite all these constraints.

iv.      Employees Attitude

Despite the fact that a questionnaire was designed to eliminate bias and misunderstanding, some employees refuse to complete the questionnaires form, due to nonchalant attitude and forgetfulness.

                  

1.9     Definition of Terms

i.        Intrinsic Motivation

Intrinsic and Extrinsic motivations refers to motivation that is driven by an interest or enjoyment in the task itself and exist within the individual rather than relying on any external pressure.  While intrinsic motivation has been studied by social and educational psychologists since the early 1970s. research has found that it is usually associated with high educational achievement and enjoyment by students. Expectations of intrinsic motivation have been given in the context of Fritz Heider, (1873), attribution theory.  Bandura, (1980), work on self-efficiency and Dedi and Ryan (1964), cognitive evaluation theory (see determination theory) students are likely to be intrinsically motivated if they.

i         Attribute their educational results to internal factors that  they can control (e.g. amount of effort they put in).

ii.       Believe they can be effective agents in reading and reaching their desired goal (e.g. the result are determined by luck but hard work).

iii.      Are interested in mastering a topic, rather than just rote-learning to achieve good grades.

xii.            Extrinsic Motivation

This type of motivation comes from outsides of the individual. Common extrinsic motivations are rewards like money and grades, coercion and threat of punishment. Competition is in general extrinsic because it encourages the performer to win and beat others not to enjoy the intrinsic rewards of the activity. A crowd cheering on the individual and trophies are also extrinsic incentives. Social psychologist has indicated that extrinsic rewards can lead to over-justification and a subsequent reduction intrinsic motivation.