How Businesses Motivate Employees (Edexcel IGCSE Business)

Remuneration

• Basic wages or salary that a worker receives for their labour
• Employees who work on an hourly rate are paid wages and accrue benefits such as annual leave according to the hours they work
• Salaries are paid to full-time staff and usually accompanied by benefits such as a fixed number of days of annual leave

Commission

• A percentage of sales revenue is paid to workers who sell products or services
• Commonly used in sales roles to motivate staff to sell more and upsell

Bonus

• An additional payment given to staff for achieving specific goals, completing projects on time or exceeding performance expectations
• The opportunity to earn more money may motivate staff to work harder and achieve better results

Promotion

• Promotion usually demands a higher level of responsibility from an employee in the job role
  • Higher pay is usually offered to reflect the increased responsibility
    
    
• A clear promotion pathway can act as a motivator to improve productivity and staff performance

Fringe Benefits

• These are additional benefits usually offered to salaried employees
  • Fringe befits could include the use of a company car, private healthcare or gym membership
    
    
• Employees can be motivated to work hard in order to keep their job and the associated fringe benefits

Autonomy

• Involves giving staff the authority and resources to make decisions and take action without first receiving management approval
  • Increases staff sense of ownership and responsibility, leading to improved productivity

Job enrichment

• Involves adding more challenging or meaningful tasks to a job
•  Staff feel more motivated and engaged, leading to improved productivity

Job rotation

• Involves moving staff between broadly similar but varied roles in the business
• Exposes staff to new challenges and experiences, which can increase motivation, understanding and skill