Adequate worker remuneration has been
found over the years to be one of the ways by which an organization can
aim to increase workers performance and invariably increase the
organization’s productivity (Muogbo, 2013). Over the years especially
with the present global economic trend, most employers of labour have
realized that for their organizations to compete favourably, employee
performance goes a long way in determining the success of the
organization. Motivation of employees in any organization is vital, not
only for the growth of the organization, but also for the growth of
individual employees (Meyer and Peng, 2006).
The role of human efforts in achieving
organizational goals cannot be overemphasized. The overall performance
of an organization is directly dependent on the amount of efforts
positively or negatively applied by workers individually or collectively
towards attaining the desired goals (Agu, 2003). Optimal organizational
performance depends among other things on what kind of incentives put
in place to motivate the workforce. Workplace incentives act as a link
between desired employee attitude and outcomes that make an employee
feel appreciated (Whetten and Cameron, 2007).
Incentives are important factors that
determine the level of employee contribution to an organization.
Incentives include economic benefits that are being supplied by the
management of an organization such as pay, promotion, verbal recognition
and rewards both financial and non financial which seeks to attract
employees to join an organization and keep them motivated within the
organization for better performance. Employee motivation plays a vital
role in organizational growth, hence effective incentive systems in an
organization may influence employee’s attitude in the workplace and
bring about an overall turnaround with resultant positive organizational
performance. Furthermore, with the appropriate incentives employees
will develop positive attitudes towards their job, feel committed to the
organization and become actively involved in the developmental
processes of the organization. Satisfied employees are less likely to
quit their jobs.
Incentives are categorized into two
broad groups; financial and non financial incentives. Financial
incentives, also called extrinsic rewards include pay, bonuses,
allowances, insurance, promotions and job security while non financial
incentives referred to as intrinsic rewards include recognition and
appreciation of workers, meeting new challenges through provision of
enabling environment, caring attitude from employers, mentor and mentee
relationships and motivating the employee.
Non-financial incentives are a part of
the various cost effective ways that organizations all over the world
adopt in compensating employees, in order to attract, motivate and
retain them in the workplace and they remain part of the factors that
contribute to organizational overall success in achieving set goals and
objectives. A non-financial incentive is crucial to an employee’s
perception of the reward systems in the workplace environment (Khan et
al., 2013). The use of non-financial incentives in organizations serves
to motivate employees towards workplace performance. Organizations can
only function with a motivated workforce who ensures efficiency, high
organizational output and prosperity of the organization. De-motivated
employees will most likely put in little or no effort in their assigned
tasks, with low quality work output and may even leave the organization
at the slightest better opportunity elsewhere. However, employees who
are well motivated with incentives are most likely to be determined,
creative and loyal to their organizations. Well motivated employees are
dedicated and contribute positively to high organizational turn over,
and this often results in optimum level of employee retention, loyalty
and overall organizational performance.
Previous studies (Sonawane, 2008; Saira
et al, 2014; Lotta, 2012; Orvill et al, 2000) have shown that
non-financial incentives are rated as powerful employee motivators for
better organizational performance than financial incentives. These
non-financial incentives include top three non-financial strategies such
as praise and commendation from immediate superior, attention from
leaders, and opportunities to lead projects or task forces.
Non-financial incentives may include workplace recognition of employee,
rewards, opportunities, and flexibility. To put in their best, employees
must feel welcomed, valued, and appreciated from time to time in an
organization. Effective workplace non-financial incentives may be
instrumental to making an employee feel appreciated and valued.
1.2 STATEMENT OF THE PROBLEM
Employers of labour both in the public
and private sector of the Nigerian economy are becoming increasingly
aware that employee motivation increases workplace productivity and
performance. However, not many organizations realize that non-financial
incentives go a long way in boosting the employee’s morale and instill a
sense of responsibility in him to put in his best to move the
organization forwards. This is because many organizations today both in
the Nigerian Public and private sectors focus only on financial
incentives as a means of motivating employees towards organizational
performance. Oftentimes, workers feel overworked and unappreciated by
the companies for which they toil day in day out. Layoffs, stressful
work conditions, ever-increasing demands, unappreciative bosses, and
unsupportive workplace environment contribute to employee
dissatisfaction and apathy.
Furthermore, it is worthy of note that
money and other material things cannot always satisfy human beings.
Aside from bonuses and other materialistic prizes, employees are often
filled with high expectations on receiving non-financial incentives such
as recognitions, awards and praise from superior officers and
management of the organizations that they work for. Hardworking
employees are sometimes dissatisfied with the mere thought that someone
somewhere in the organization recognizes their efforts no matter how
little but refuses to praise or recognize them for it.
Every organization, whether public or
private need motivated workers that are effective and efficient in
carrying out their duties as this not only increases organizational
performance, it also gives the organization an edge over competitors.
Employees who are motivated to work energetically and creatively towards
accomplishment of organizational goals are one of the most important
inputs to organizational success and performance. Hence, the challenge
for organizations is how to ensure that their workers are highly
motivated and the form of rewards or incentive systems to adopt for
overall organizational performance.
Studies have proven that rewarding
employees is one of the ways to keep organizational workforce motivated
with a significant relationship between reward and motivation of
employees and the overall performance of an organization. Motivation,
therefore exerts a driving force on employee attitudes to work and
invariably organizational performance. However, few research studies
have investigated the relationship between non-financial incentives and
organizational performance in Nigeria. Therefore, it becomes imperative
to adopt an effective and reliable method of motivating employees for
organizational performance. In line with this purpose, this study
focuses on the use of non-financial incentives as a motivational tool
for organization performance in the private sector.
1.3 AIM AND OBJECTIVES OF THE STUDY
The aim of this study is to
assess the impact of non-financial incentives on organizational
performance in organizations.
Specific objectives of the study include;
- To find out if non-financial incentive systems are used at Jobberman Nig. Ltd.
- To determine the type of non-financial incentives used at Jobberman Nig. Ltd.
- To determine the impact of non-financial incentive used on organizational performance in Jobberman Nig. Ltd.
- To identify factors that influence non-financial incentive system adopted at Jobberman Nig. Ltd.
1.4 RESEARCH QUESTIONS
This research study will attempt to answer the following research questions;
- What is the degree of utilization of non-financial incentives in Jobberman Nig. Ltd. based on perception of employees?
- What type of non-financial incentives is utilized in Jobberman Nig. Ltd. based on perception of employees?
- What is the impact of non-financial incentives on organizational
performance in Jobberman Nig. Ltd. based on perception of employees?
- What are the factors affecting the use of non-financial incentives at Jobberman Nig. Ltd.
The following hypotheses are formulated to address the research question;
Ho: There is no statistically significant relationship between non-financial incentive and organizational performance.
HA: There is a statistically significant relationship between non-financial incentive and organizational performance.
1.6 SIGNIFICANCE OF THE STUDY
This study will investigate to what
extent non-financial incentives are utilized in Jobberman Nig Ltd. and
whether it has a potential to improve organizational performance. This
study is significant because it will emphasize the impact of
non-financial incentives and rewards on organizational performance.
Thus, this study will afford us the
opportunity to assess the impact of non-financial incentives on
organizational performance. Findings from this study will also add to
the existing body of knowledge on the impact of non-financial incentives
on organizational performance.
1.7 SCOPE OF THE STUDY
The scope of this study is limited to
Jobberman Nig. Ltd. In the course of this study, questionnaires shall
be distributed to various categories of workers in all the departments
of the organization. Issues to be dealt with in this study include the
impact of non financial incentives on workers’ performance, workers’
satisfaction with the non-financial incentive system used by the
organization; challenges and factors influencing adoption of the
1.8 LIMITATION OF THE STUDY
In the course of the study, the
researcher encountered challenges such as limited time, little or no
previous literature on the subject.
1.9 OPERATIONAL DEFINITION OF TERMS
Employee: one employed by another or a company usually for wages and salary and in a position below the executive level
Incentives: something that encourages a person to do something or to work harder
Motivation: the act
or process of giving someone a reason for doing something. The condition
of being motivated or being eager to act or
Non financial incentives:
is said to exist when a person does not expect some form of material
reward especially money in exchange for acting in a particular way.
Organization: an administrative or functional structure such as a business or company formed for a particular purpose.
Organizational Performance: the actual output or results of an organization as measured against its intended outputs or goals and objectives.