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EFFECT OF NON-MONETARY INCENTIVES ON EMPLOYEES PERFORMANCE

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EFFECT OF NON-MONETARY INCENTIVES ON EMPLOYEES PERFORMANCE

TABLE OF CONTENTS

Title Page                                                                                                    i

Declaration                                                                                                 ii

Certification                                                                                                         iii

Approval Page                                                                                           iv

Dedication page                                                                                          v

Acknowledgement                                                                                       vi

Table of Content                                                                                         vii

Abstract                                                                                                      ix

 

CHAPTER ONE

INTRODUCTION

  • Background to the Study 1
  • Statement of the Problem 3

1.3     Objectives of the Study                                                                     4

1.4     Significance of the Study                                                                            4

1.5     Research Questions                                                                           5

1.6     Scope of the Study                                                                                     5

1.7     Definition of key Term                                                                      6

 

CHAPTER TWO

LITERATURE REVIEW

2.1     Introduction                                                                                                8

2.2     Conceptual Framework                                                                    8

2.2.1  The Concept of Financial and Non Financial Incentives                             8

2.2.2  Concept of Employee Performance                                                   11

2.2.3  Concept of Performance Incentives in Workplace                                     12

2.2.4  The Nexus between Incentives and Productivity                               13

2.3     Theoretical Framework                                                                     16

2.3.1  The Evolution of Motivational Concepts                                          17

2.3.2  Process Theories of Motivation                                                                  24

2.3.3  Need Theories                                                                                   29

2.3.4  Abraham Maslow Theory                                                                 29

2.3.5  Murray’s Manifest Needs Theory                                                     33

2.3.6  Herzberg, and his Two-Factory Theory                                            36

2.3.7  Evaluation of the Motivational Theories Reviewed                                    39

2.4     Empirical Literature                                                                          40

2.4.1  The Effect of Financial and Non Financial Incentive to the Employee Performance                                                                                            40

2.4.2  Impact of Incentive on Employee’s Motivation                                54

2.5     Summary                                                                                          58

 

CHAPTER THREE

RESEARCH METHODOLOGY

3.1     Introduction                                                                                                60

3.2     Population and Sample Size of the Study                                         60

3.3     Source of Data Collection                                                                 61

3.4     Method of Data Collection                                                                61

3.5     Method of Data Analysis                                                                           62

3.6     Summary                                                                                          62

 

 

CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS

4.1     Introduction                                                                                                63

4.2     Analysis of Respondent’s Demographic Variables                                    63

4.3     Data Analysis                                                                                   66

4.4     Summary of Findings                                                                       73

4.5     Discussion of Findings                                                                      74

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATIONS

5.1     Summary                                                                                          76

5.2     Conclusion                                                                                        77

5.3     Recommendations                                                                                      77

Bibliography                                                                                     79

Appendix I                                                                                        82

Appendix II                                                                                                83

 

ABSTRACT

The study examines the effect of financial incentives on staff productivity in Niyya foods Kaduna. The research question that guided the study were: Is Niyya Food remuneration based on incentive scheme? What kind of financial incentive does Niyya Food give to its works and what are the effect on what workers? What kind of non financial incentives does Niyya Food use to boost workers productivity? What are the constraints militating against Niyya Food incentive schemes and how can it be overcome?A survey method was used for this study. The population  consisted of all Staff of Niyya Food Kaduna. Out of 158 persons, a  sample size of 70 was drawn from the total population using the stratified random sampling technique. A questionnaire developed by the researcher based on likert 5-point scale was used for the study. Mean scores was used to analyse the data based on the research questions. The research result shows that Niyya Food incentive scheme does not enhance  workers performance because, it does not take into cognizance in it remuneration and do  not even evaluate or appraisal workers  performance.It was recommended that  Other non financial incentives like lectures, seminar, symposium as well as Recreational facilities, such as club with sporting facilities, entry bar and other recreational facility that would help staff unwind after work should be designed and adopted. This will facilitate efficiency and increase productivity in Niyya Food.

 

CHAPTER ONE

INTRODUCTION

  • Background to the Study

All organizations are concerned with what should be done to achieve high level of productivity through staff motivation using the right kind of incentive. Most organizations in the past have been using financial incentives but their workers are still agitating for increment in salaries. Consequently the effect of non financial incentive becomes a burning issue in human resource management (Okoh, 2008).

The issue of adequate motivation and consequently workers productivity is a product of a person’s set up of needs, goals, drive and experience. By implication, this means that factors which govern motivation, job satisfaction, workers productivity and attitude to work differ from one society to another.

However, the entire issue of the implication of adequate motivation on workers productivity is embedded in the various theories of motivation.

People are motivated by various factors at different times, according to

Wilkinson et al, the first factor is the combination of the individual perceptions of the expectations other people have of them, and their own expectations of themselves. This happens because people come into work situations with various expectations.

 

People work together in large organisations like bank, factory where they are expected to follow orders, which they may not approve of. In addition, they may have to obey instruction from supervisors they had no hand in selecting. This is the type of situation where the worker might have no opportunity for self-expression. The basic question that now arises, relates to how to create a situation in which workers can satisfy their individual needs while working towards organisational goals. How can workers in corporate organisation in Nigeria who’s workers feel that their salaries are low when compared with their contemporaries in other organisation?

 

As such a lot of theoretical concept, principles and techniques of management have evolved in response to these challenges/ but most scholars suggest that more conceptual and empirical work is required to show the link between financial and non financial incentive and staff productivity is still vague but some studies have documented in their work that financial incentive is readily perceived as having a high instrumental value that makes putting forth extra effort worthwhile and its has a long term effect in terms of labour turnover rate because of comparative value for alternative employment while non financial incentive has less initial impact as the pragmatics of financial gain, they seem to have a steady, sustainable impact(Egbe,2008).

Despite the growing body of literature and empirical study on the effect of  non financial incentive on workers productivity, the subject matter still remains complex. Hence, the need to undertake a survey on the effect of   non monetary incentives on staff productivity in Niyya food and drinks company Ltd Kaduna.

 

  • Statement of the Problem

Most organizations in Nigeria are constraint with the problem of using non performance based element like salaries to compensate it staff as against performance-related pay structure which has hamper productivity because it does not make worker put in extra effort in their work. This is so because their compensation is not based on incentive schemes that elicit additional effort of workers sequel to unfriendly government legislation on wages clause and bureaucratic inefficiency. Hence the need for the research to examine the effect of  non monetary incentive on employee productivity in Niyya Food and drinks Ltd Kaduna.

 

 

1.3     Objectives of the Study

The main objective of this study is to examine the effect of non monetary incentive on staff of Niyya food and drinks Kaduna. Other Specific objectives are to:

  1. Assess whether staff remuneration is based on incentive schemes that motivate them.
  2. Examine all financial incentives given to staff and their effect on worker productivity.
  • Identify non financial incentives used in boosting staff productivity.
  1. Evaluate out the constraints militating against incentive scheme Niyya Food and drinks and make recommendations to the identified problems.

 

1.4     Significance of the Study

This study brings to light the effect of non monetary incentives on staff performance in organization. The study may therefore be beneficial to the organization understudy in area of policy formulations as regard staff incentive schemes and remuneration.

To education, the study may contribute to already existing knowledge on the effect of financial and non financial incentives on workers’ performance.

Finally, to those in academics and human resource researches, the study may serve as a springboard for further investigations.

1.5     Research Questions

This study  provide answers to the following research questions:

  1. Is Niyya Food and drinks limited’s remuneration based on incentive scheme that motivate staff performance?
  2. What kind of financial incentive do Niyya food and drinks give to its workers and what are their effect on workers productivity?
  • What kind of non financial incentive do Niyya food and drinks use to boost workers productivity?
  1. What are the constraints militating against Niyya Food and drinks incentive scheme and how can these constraints be overcome?

 

1.6     Scope of the Study

The study covers an empirical investigation of the effect of  non monetary motivation on staff productivity in Niyya Food and drinks. The main scope and time frame for this investigation covers Niyya Food and drinks incentive schemes from 2006-2011.