Paper 8859
Paper 8859
Paper 8859
IJARSCT
International Journal of Advanced Research in Science, Communication and Technology (IJARSCT)
Abstract: The goal of this study is to discover the connection between monetary incentives and their impact
on employee performance. The essence or objective is also to demonstrate that monetary incentives are an
effective motivator for employee performance in a society like ours where the cost of living is extremely
high. Employees are a priceless asset when it comes to attaining the company's goals, and to guarantee
that all employees are on board, they must be motivated and inspired, because incentives are one of the
methods that management employs to encourage inspired people.
I. INTRODUCTION
How to inspire employees to perform better is one of the main challenges that companies, in both the public and
commercial sectors, face. Most economists believe that financial incentives lead to better performance. Financial
awards for employee achievement, sometimes known as monetary incentives, are crucial in motivating staff in a
cutthroat workplace. The economic research claims that cash rewards are a very popular way for organizations and
businesses to improve employee performance. For a number of reasons, financial benefits are crucial to improving
employee performance. This particular study analyzes the proper monetary incentives and the importance of monetary
incentives to enhance performance in a competitive business environment. The purpose of this study is to determine the
importance of understanding monetary incentives, the reasons for introducing monetary rewards in the business market,
the nature of monetary rewards, and the benefits they provide to employees. The objective of the study focuses on how
the business market has changed as a result of the monetary incentive system. The literature review in this paper deals
with an important aspect of the process of monetary incentive policy to improve employees. The objective of the study
focuses on how the business market has changed through the monetary incentive system. Organizational performance is
a complex phenomenon largely affected by the ability and motivation of the workforce in any firm. One of the major
problems facing most employers in both public and private sectors is how to motivate their employees in order to
improve performance. The field of Economics is largely based on the assumption that financial incentives improve
performance (Igbaekemem, 2014). In consideration of the era of global hyper competitiveness in the business world,
incentives are fundamental imperatives to derive maximum employee inputs, retention, commitment from workers and
industrial harmony between the workforce and manufacturing concerns. It is generally believed that effect of financial
incentives is unambiguously positive; a large monetary incentive improves employee performance. Thus, employees of
an organization have motives and inner desires that are expressed in the form of actions and efforts towards job roles to
meet their needs. Employee motivation is the level of energy, commitment, and creativity that a company's workers
apply to their job (Ebrurajolo, 2004).
The issue of employee performance cannot be over emphasized. The most important thing for an organization is the
devotion and loyalty of its employees, which is achieved if the employees are paid with better rewards. Rewards are
highly concerned to overcome dissatisfaction and to increase performance of employees (Mehta, 2014). Despite the fact
that reward management has received substantial research attention, this has dwelt more on developed and emerging
economies (Carton, 2004; San, Theen, & Heng, 2012), with little done in the developing economies (Agwu, 2013).
Various researchers have come up with various ways to motivate people at work. However, because human beings
V. LITERATURE REVIEW
The most valuable assets a company has are its employees. As a result, it is crucial for businesses to find ways to
promote a positive outlook in order to grow both their brand and their profit margin. Human nature is quite simple, but
it can also be incredibly complex, which is why organizations need people. This makes it difficult for businesses to
understand how to inspire their workforce. A fundamental prerequisite for properly motivating people is understanding
human nature. Monetary incentives are a common desire of every employee. In the globally competitive market,
rewarding employees plays a crucial role in motivating them, enhancing their performance, and giving them the
opportunity to grow professionally. This process of employee reward promotes an employee's work performance or
mentality. The practice of monetary incentives is a bonus or reward for the employees of a company (Oldham et al.
2018). It is a general desire of the employees of a company that motivates the employees to perform well. A monetary
incentive is an additional commitment to employees in terms of their future growth, career opportunities, health care, or
any kind of reward for employees. So, it can be clearly stated that monetary rewards play a major role in both public
and private sectors. We can take the example of Oman College of Technologies, where this kind of method is used to
cheer up employees and make them perform at their best. Company owners have noticed that most employees, when
they achieve something on behalf of the company, expect a financial incentive for their best performance. It is clearly
observed that rewards in the form of monetary incentives spur employees to perform at their best and lead to new high
performance. It is clear that employees who are rewarded for their outstanding performance remain more motivated and
active in their respective roles, which in turn has a strong impact on their daily performance. Thus, it can be clearly
stated that monetary rewards play a major role in both the public and private sectors. We can use the example of Oman
College of Technologies, where this type of method is used to cheer up employees and encourage them to perform at
their best. . Reward in the form of monetary incentives helps to maintain employee satisfaction and has a great impact
on their performance in the department. It is observed that reward motivates wage earners only when they have done a
certain amount of hard work for an assigned task with pure sincerity.
VII. CONCLUSION
The findings of the study support the assertions made by other academics that financial incentives alone are insufficient
to inspire personnel. Additionally, it's best to use both monetary and non-monetary incentives to their full potential
because, as they say, "Variety is the spice of life." The role, efficacy, and appropriateness of monetary and non-
monetary incentives are different from one another. To accommodate the various requirements and interests of
employees, a balance between monetary and non-monetary incentives should be found. Since motivation is a
complicated and individualized topic, there is no one optimum method for dealing with it. According to research,
financial incentives by themselves are insufficient to inspire workers. Wages are important because they provide the
basic necessities of life, but they are important primarily for what they symbolize to the recipient. For money to be used
as a motivational tool, managers must study their employees, the conditions under which they work, and the task they
perform. The value of incentives is determined by what people learn to associate with them. According to Imoisili,
high-performing employees do not work just to make money. They are motivated by enjoyment of performance,
interest in their work, and success itself.
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