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Employee motivation is an intrinsic and internal drive to put forth the necessary effort and action towards work-related activities. It has been broadly defined as the "psychological forces that determine the direction of a person's behavior in an organisation, a person's level of effort and a person's level of persistence". [1]
Pay-for-Performance is a method of employee motivation meant to improve performance in the United States federal government by offering incentives such as salary increases, bonuses, and benefits. It is a similar concept to Merit Pay for public teachers and it follows basic models from Performance-related Pay in the private sector.
An incentive program is a formal scheme used to promote or encourage specific actions or behavior by a specific group of people during a defined period of time. Incentive programs are particularly used in business management to motivate employees and in sales to attract and retain customers.
Reward systems exist in order to motivate employees to work towards achieving strategic goals which are set by entities as well as aligning the actions of employees to reflect the culture, aims and beliefs a business or organisation wishes to uphold. [4] Reward management is not only concerned with pay and employee benefits.
If workers are paid based on their performance, it has the potential to leave some employees worse off than others. This type environment could also be more demotivating for under-performing workers and more motivating for over-achieving workers which results in a bigger payoff gap between the two types of workers over time.
The job-based theories hold that the key to motivation is within an employee's job itself. Generally, these theories say that jobs can be motivating by their very design. This is a particularly useful view for organizations, because the practices set out in the theories can be implemented more practically in an organization.
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