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Impact Of Motivation And Compensation In The Enhancement Of Organizational Productivity

(A Case Study Of Selected Organizations In Imo State)

5 Chapters
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61 Pages
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8,094 Words

Motivation and compensation play integral roles in boosting organizational productivity. Motivated employees are more engaged, committed, and willing to exert discretionary effort towards achieving organizational goals. By recognizing and rewarding their contributions through effective compensation strategies, such as competitive salaries, performance bonuses, and benefits packages, organizations can foster a culture of high performance and retention. Moreover, aligning compensation with individual and team achievements not only incentivizes desired behaviors but also reinforces the link between performance and rewards. When employees feel valued and fairly compensated for their efforts, they are more likely to demonstrate higher levels of job satisfaction, morale, and loyalty, ultimately leading to increased productivity and organizational success.

ABSTRACT

The aim of the study is to examine the impact of motivation and compensation on organizational productivity. The findings of this research work shows that without adequate workers compensation, there will be a lot of wastage of the organization’s resources. Giving fringe benefits to the productivity employees after long service will ensure that they are at par, with other employees from other firms. Management should always ensure adequate compensation. There should be periodic review of benefits accrued to staff to bring them at par, with other workers of similar settings.

TABLE OF CONTENT

Title Page
Approval Page
Dedication
Acknowledgments
Abstract
Table of Contents

 CHAPTER ONE
1.0 Introduction 1
1.1 Background of the study 1
1.2 Statement of the problems 4
1.3 Objectives of the study 5
1.4 Research questions 7
1.5 Research hypothesis 7
1.6 Significance of the study 8
1.7 Scope of the study 9
1.8 Limitations of the study 10
1.9 Definitions of terms 10

CHAPTER TWO
2.0 Literature Review 13
2.1 Introduction 13
2.2 Definition of motivation and compensation 13
2.3 Theories of motivation 14
2.4 Maslow’s hierarchy of needs 14
2.5 Alderfer’s Erg Theory 17
2.6 Hertzberg’s motivation Sp. theory 17
2.7 David S. McClelland Needs theory 18
2.8 McGregor’s theory X and Y 19
2.9 The Vroom’s expectancy theory 21
2.10 Training and motivation 22
2.11 Interaction and motivation 24
2.12 Supervision and motivation 24
2.13 Summary 25

CHAPTER THREE
3.0 Research methodology 26
3.1 Introduction 26
3.2 Research design 27
3.3 Sources and method of data collection 28
3.4 Population and sample size 29
3.5 Sampling techniques 30
3.6 Validity and reliability of measuring instrument 30
3.7 Method of data analysis 31

CHAPTER FOUR
4.0 Presentation, analysis and interpretation of data 32
4.1 Introduction 32
4.2 Presentation of data 32
4.3 Analysis of data 34
4.4 Test of hypothesis 40
4.4 Detailed decision on data collected 45

CHAPTER FIVE
5.0 Summary of findings, Conclusion and
Recommendations 47
5.1 Introduction 47
5.2 Summary of findings 47
5.3 Conclusion 48
5.4 Recommendations 49
Bibliography 51
Appendices 52-55

 

CHAPTER ONE

INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Human motives are based on needs, whether consciously or subconsciously felt. some are primary needs such as the physiological needs for water, air, food, sleep and shelter. Other needs may be regarded as the secondary needs, such as self esteem, status, affiliation with others affection, giving accomplishment and self assertion. Naturally these needs vary in intensity and over time between individuals.
According to Weirich and Koontz (2005), mutilation is a general term applying to the entire class of drives, desires, needs wishes, and similar forces. To say that managers motivate their subordinates is to say that they do thing which they hope will satisfy these chives and desires and induce the subordinates to act in a desired direction manner.
McChane (2009) defined motivation as the forces within a person that affect his or her direction, intensity and persistence of voluntary behavior. Direction refers to the path along which people engage their effort. This sense of direction of effort reflects the fact that people have choices about where they put their efforts. In order works, motivation is goal direction not random people are motivated to arrive at work on time, finish a project a few hours early, or aim for many other targets. Intensity refers to the amount of effort allocation to the goal. For example, two employees might be motivated to finish their project a few hours each (direction) but only one of them puts enough effort (intensity) to achieve this goal. However, intensity is how much you push yourself to complete the task. Finally, motivation involves varying levels of persistence that is continuing the effort for a certain amount of time. Employees sustain their efforts until they reach their goals or give up before time. To buttress these three elements of motivation in this definition, consider driving a car in which the thrust of the engine is your effort. Direction refers to where you stead the car intensity is how hand you put your foot down on the acceleration pedal and persistence is how long you drive towards the destination. Compensation means the payment of wages, salaries, promotion to all the productive employees. Compensation is an ingredient of motivation. The research works is intended to make findings on how staff motivation and compensation enhances the organization productivity of employees in Consolidated Breweries Awo-Omamma, Ohaji/Egbema Local Government Area, and Owerri North Local Government Area, Imo State.
Consolidated Breweries Plc, is the Nigeria third largest and the producers of the quality brand 33 Export Larger Bear, Turbo king Dark Ale, Hi-malt non-alcoholic malt drink.
Owerri North is a Local Government Area of Imo State, Nigeria. its headquarters are in the town or Orie-Uratta. It has an area of 198km2 and a population of 175, 395 as at the 2006 census the postal code of the area is 460. Ohaji/Egbema is a Local Government Area of Imo State Nigeria. Its headquarters is in Mmahu-Egbema, it has an area of 890km2 and a population of 182, 53 and as at the 2006 census. The postal code of the area is 464.

1.2 STATEMENT OF THE PROBLEMS
This is the main reason of writing this particular project the center of the problem should be how compensation and motivation enhance the productivity of the organization.
Problems: Evidence show presence of selected firm in Imo State failed to develop motivational programmes for its employees to undergo strike and look outs.
Employees are not willing to perform whole heartedly because sometimes even their basis needs are not properly met which stop them from developing their higher level needs like self esteem and actualization.
Cases show turnover and absenteeism rate is high in some companies in this state because the employees feeling of attachment and drive to work in these organizations is very low.
Evidences show that staff regularly man excuses to abstain themselves from work.
Some of the selected firms in Imo State are orthodox while designing the compensation package and do not involve many compulsory schemes and allowances which affects the employee’s motivational level and cause them to deliver inefficient work. This, we can see there are issues in these selected organization I Imo State which need to be sorted out. If these issues are addressed, then the service level of these selected organizations in Imo State can be at par the other regional offices across the globe.

1.3 OBJECTIVES OF THE STUDY
All researchers when working on a research have some objectives in their minds. These objectives are formed after understanding the organization in a particular region and by getting supportive evidences and cases. As a student researcher, I have also certain objective in my mind after gathering relevant information at the mature stage which helped to create certain objectives which will help the researcher to proceed with his research work. The primary objectives are as follows:
1. To know about the root cause behind the agitating and unproductive employees in these organizations.
2. To study about the key drivers that motivates the employees to work whole heartily in the organizations.
3. To find out the reason for income disparity among the employees in the organizations.
4. To investigate what appropriates pay package is expected by the employees.
5. To analyze the current motivational and compensation strategy(s) adopted by local government areas and breweries in Imo State.
6. To analyze the reason behind communication barrier between top management and staff.
7. To investigate what are the key drives which will enhance the performance of employees work in stressed environment with long working hours.
In overall, to find out what exactly is the employees and management vision in this area of study and what would encourage and inspire employees to maintain their motivational level.

1.4 RESEARCH QUESTIONS
1. What acts as key motivating drivers for employees in local government areas and Consolidated Breweries Plc?
2. What factors need to be considered in order to motivate high performance?
3. Do non-financial rewards play an important role in the minds of local government and Consolidated Breweries staff?
4. Do performance appraisal and feed-back system act as a motivating factor?
5. What are the vital elements of complete compensation package for a local government and Consolidated Breweries employees?

1.5 RESEARCH HYPOTHESIS
In the course of answering the above questions, the following hypothesis will be tested.
Ho: There is no significant impact made by motivation on the organizational performance.
Hi: There is a significant impact made by motivation on the organizational performance.
Ho: There is no impact made by motivation or the organizational performance.
Hi: There is an impact made by motivation or the organizational performance.
Ho: There is no significant relationship between motivation, compensation and employees productivity.
Hi: There is a significant relationship between motivation, compensation and employees productivity.

1.6 SIGNIFICANCE OF THE STUDY
This study will help us to evaluate the effect of management motivation and compensation in the enhancement of organizational productivity with particular reference to some selected or organization in Imo State.
The study is very important because it helps us to determine whether motivation and compensation of staff are responsible for higher productivity. Motivation and compensation also provide more knowledge and skills necessary for specific purpose through training activities. It is hoped that by discovering those factors which motivate the workers and encourage them towards achievement and greater productivity as those that produce negative effect, the organization will have its goals fully realized. Academically, this research contributes a lot in the field of business studies especially as it studies motivation and compensation for improved productivity. It will help the future researchers who will like to do research on staff motivation and compensation for improved productivity.

1.7 SCOPE OF THE STUDY
Since this study is to examine the impact of motivation and compensation in the enhancement of organizational productivity with particular reference to some selected firms in Imo State. It is not easy for the researcher to study the whole employees in the organizations. Because of this, the researcher decided to limit himself to a certain extent. Questionnaires were the main data collection instrument. Although, this study was limited to selected firms in Imo State but the resultant effect could be very useful to other firms programme. The aim and objectives of staff motivation and compensation the assessment of their staff over all performance, consequent suggestions and recommendation could also be envisaged to further improve efficiency of some selected organization or all the organizations in Imo State.

1.8 LIMITATIONS OF THE STUDY
The answers of the sample which will be obtained through questionnaires are assumed to be true, sample may not be convinced to share true facts of the problems the sample may show signs of distrust about the overall objective of the study.
Disclosure of names, identity of the personnel in the organizations may be a limited factor. As it is a student research, finance and time (5months) can be limiting factors some designs mentioned above may not be used is some unforeseen problems take place.

1.9 DEFINITION OF TERMS
Looking at the impact of motivation and compensation in the enhancement of the selected organizations productivity, the following terms need to be defined.
Motivation: This is defined as the process that arouses channels, sustains, and gives people behavior purpose and directive, Keitner (1980). It is a way of getting the desired outcome or result from the employees in other to obtain goals.
Compensation: The means the payment of wages, salaries, giving vacations, bonuses, profit sharing and stock option to the productive employees. In this case compensation is a means of motivating staffs towards achievement of organizational goals. Therefore, the measure performance and pay compensations according to the employee’s effort (intensity) to achieve organizational objectives.
Wages: This is a compensation based on the workers effort (intensity) wages are compensation pain according to how much workers push themselves to complete a task.
Salaries: This is a compensation paid to worker based on monthly or weekly basis.
Bonus: This is incentives or money paid to employees in addition to their regular compensation, may be because of added effort or added labour.
Productivity: This is the total outflow of the 4m’s of management man, money, machines and maintainance within an organization to achieve the predefined objectives of the organizations. It is the adequate utilization of all the resources together with a good motivational system in the organization that would lead to high productivity rate in the organization.
Job Satisfaction: This is the joy that employees in the organizations derive from doing a particular job that satisfies one’s interest. It represents the effective responses by employees to their job (Valentine and Williams, 2005).
Training: Training is defined as any organization planned effort to change the behavior or attitude of their employees so that they can perform to accepted standard on the job, Stoner (1982).
Need: This is created wherever there is a physiochemical imbalance, the reads at human being can be classified into three categories as physiological, social and logistic needs.

 

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Motivation and compensation play crucial roles in enhancing organizational productivity. When employees are motivated and rewarded appropriately, they are more likely to be engaged, committed, and productive in their roles. Here’s how motivation and compensation impact organizational productivity:

Motivation:

  1. Increased Engagement: Motivated employees are more engaged in their work. They have a sense of purpose and commitment, which leads to higher levels of effort and dedication.
  2. Higher Job Satisfaction: Motivation often stems from the alignment between individual goals and organizational objectives. When employees feel that their work contributes to meaningful goals, job satisfaction increases, and they are more likely to put in extra effort.
  3. Improved Performance: Motivated employees tend to perform better because they are driven to excel. They take initiative, seek opportunities for improvement, and are more likely to go beyond their job descriptions.
  4. Innovation and Creativity: Motivation fosters a conducive environment for innovation and creativity. Employees who are motivated feel empowered to share ideas, take calculated risks, and contribute to problem-solving.
  5. Reduced Absenteeism and Turnover: Motivated employees are less likely to miss work or leave the organization. Their commitment to the job and the organization reduces absenteeism and turnover rates.

Compensation:

  1. Recognition and Reward: Fair and competitive compensation systems provide employees with a sense of recognition and reward for their contributions. This recognition motivates them to continue performing at high levels.
  2. Attraction and Retention: Competitive compensation packages attract top talent to the organization and help retain skilled employees. Employees are more likely to stay if they feel their compensation aligns with their skills and the market standards.
  3. Job Satisfaction: Compensation is a critical factor in overall job satisfaction. Employees who believe they are fairly compensated for their efforts are more likely to be satisfied with their jobs and perform better.
  4. Financial Security: Adequate compensation addresses employees’ financial needs and reduces stress related to personal finances. When employees feel financially secure, they can focus more on their work.
  5. Motivation for Performance Improvement: Compensation structures that include performance-based incentives encourage employees to continually improve their performance to earn higher rewards.
  6. Equity and Fairness: Transparent compensation practices contribute to a sense of equity and fairness within the organization. When employees perceive that compensation is distributed fairly, it enhances their motivation and commitment.

Synergy Between Motivation and Compensation: The synergy between motivation and compensation is crucial. While compensation provides tangible rewards, motivation taps into intrinsic factors that drive employees to perform. An effective approach combines both monetary and non-monetary motivators to create a work environment where employees are not only fairly compensated but also inspired to excel.

Ultimately, organizations that invest in both motivation and compensation strategies are likely to experience improved employee morale, enhanced productivity, reduced turnover, and a more positive organizational culture. It’s important for organizations to understand the specific needs and preferences of their employees and tailor their motivation and compensation strategies accordingly.