Strengths and Limitations of Using Money as a Motivator for Employees

Motivation

Table of Contents
INTRODUCTION..............................................................................................................................3
TASK.................................................................................................................................................3
Motivation and its approaches ......................................................................................................3
.........................................................................................................................................................10
CONCLUSION ...............................................................................................................................10
REFERENCES.................................................................................................................................11

INTRODUCTION
In organizations, employee motivation is a level of the commitment, innovation and energy
that a firm's workforce hold during their working days. Improving and maintaining motivation at
workplace can be an issues for many organizations, as not every task will be interesting. Thus,
businesses find the ways to keep their employees involved (Al‐Ghazali and Afsar, 2021). Well
motivated employees or workers stay within the business organization through company's think
and thin. At workplace, motivation is an essential element to establish an effective relationship
between employees and employers. In modern management system, various motivational methods
have been put into practices to increase employees productivity. This report will be based on the
different motivational approach along with advantages and disadvantages. There will as discussion
on how various approaches can help the organization to motivate their employees.
TASK
Motivation and its approaches
Motivation can be divided into two categories monetary and non-monetary motivation. Monetary
benefits are the financial rewards which are given to the workers by the management of the
organisation to keep them motivated and for meeting the goals and targets of the business. These
involves commission, bonuses, cash awards, gift cards and many more. As the name suggests
monetary incentives have a monetary value and the workers can instantly evaluate their exact
worth (Alfes, Veld and Fürstenberg, 2021). This benefits are the most direct method of displaying
appreciation and encouraging motivation. Money is considered an effective motivator for
improving the productivity and overall performance of the employee's. The purpose of monetary
benefits is to reward associates for excellent job performance through money.
Strengths of using money as a motivation:
Money is considered a very essential aspect in enhancing the performance of the workers. The
advantages for using money as a motivator are discussed below:
 Happier Employee's: It is very important for the organisation's to keep their workers
happy in order to increase the moral and job satisfaction. The productivity of the
employee's are dependent on the motivation. Every company should try to give monetary
benefits in order to encourage the workers to give their best. This way the goals and

objectives of the organisation are achieved on time. Implementing the employee incentive
plans increases the personal happiness and job satisfaction of the workforce.
 Better Employee Retention: The workers seek monetary benefits and other programs
when they look for a new job. It has been seen that giving incentives to the workers help in
retaining the existing employee's in the organisation. The workers are unlikely to leave a
workplace shortly with the increased motivation. It reduces the recruitment cost of the
company which will improve the current position of the business in the market.
 Better Organisational Performance: Every company realises the importance of high
performing employee's for the success of the business. The managers prepare various
strategies in order to properly manage the workers which help them to improve the quality
and contribution of the employee's. The more the workers are provided with monetary
incentives, they will likely to work according to their potential. This will ultimately make a
positive impact on the sales and profits of the organisation.
 Encourage Team Environment: When all the workers are provided monetary benefits, it
will lead to creation of a collaborative and en-richening workplace. All the employee's will
feel comfortable working with each other. This helps the management of the organisation
to properly implement business strategies (Amin and et. al., 2021).
 Increase Employee Engagement: The companies try to make the workforce involved in
various activities so that they do not feel ignored. The monetary benefits which are
provided by the organisation increases the engagement of the workers. The employee's will
work by keeping in mind the objectives and goals of the business. This make a positive
impact on the overall performance of the company. This also helps in creating a good
image of the organisation in the market.
Limitations of using money as a motivation:
Money is not everything when it comes to job satisfaction and motivation. There are other factors
which are considered by the employee's in their working condition. The employee's are attracted
to the incentives only up to an extent which needs to be understand by the organisation's. The
disadvantages of using money as a motivation are discussed below:
 Creates Inequality: Sometimes the management of the organisation make incentives plan
only for the best employee's. This affects the performance of the other workers due to the