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INCENTIVES SCHEMES AND WORKER'S PERFORMANCE IN NIGERIA

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Motivation in is a common word often discussed by people in any given organization. One of the major problems confronting management is that of motivating workers to perform assigned tasks to meet or surpass predetermined standards. Motivation is that energizing force that induces or compels and maintains behaviour. Human behaviour is motivated, it is goal directed. It is not easy to motivate an individual, for the success of any motivational effort depends on the extent to which the motivator meets the needs of the individual employee for whom it is intended. Motivation is an internal psychological process whose presence or absence is in inferred from observed performance. 

Motivation is one of the three factors in he function directing. It is described as a process that arouses channels, Sustains and gives people’s behaviour purpose and direction (Kretner, 1980 p.301). It is concerned with the “why’’ of human behaviour, what it is that makes people do things (Donnelly et al 1981, p. 129) or simply it is the stimulation of people to action to accomplish desired goals.

Motivation is complex factor as it concerns individuals and their needs, and every individual, is unique. But there are some things that individual have in common, for example physical, social and growth  needs, expect that the strength of these needs vary from person and from time to time within the same person.

Motivated behaviour has three basic characteristics:

1.      It is sustained- It is maintained for a long time until satisfied.

2.      It is goal directed- It seeks to achieve and objective.

3.      It results from a felt need an urge directed towards a need  (Nwachukwu 1988 p. 181).

INCENTIVE 

Incentive is a form of variable reward targeted at a particular performance outcome. It is designed to reward and therefore encourage positive employee action within clearly defined parameters, to achieve certain business outcomes, (Aranson 1949 p. 273)

These include: 

•      Increasing gross profit

•      Reducing production costs or services times

•      Reduction waste

•      Enhancing customer retention and satisfaction 

•      Increasing market share or sales volume.

The rational behind any incentive plan is to encourage and motivate employee behaviour that contributes towards the achievement of business objectives. To be successful, an incentive plan must strongly influence behaviour and possess a number of fundamental characteristics, which combine to motivate and drive individual and/ or team performance. The effectiveness of an incentive plan at an individual levels is determined by: (Garelt 1964 p. 253- 264)

1.                  The individuals’ understanding of the path.

2.                  The cognitive process of individuals, which determines whether the incentive plan will infact motivate a change in employee behaviour.

3.                  The ability of the individuals to influence and control outcomes rewarded by the plan.

The likelihood that an inventive plan will influence behaviour in the desired direction is maximized when the incentive plan is designed to recognize the importance of these three criteria. Any incentive plan must be clearly understood by those who participate in it. This is a function of the complexity of the 

Plan and how well the plan is communicated. It is essential that participants understand the following  aspects; 

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