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IGCSEBusinessCambridge (CIE)Revision Notes2. People in Business (HR)2.1 Motivating EmployeesNon-Financial Methods of Motivation

Non-Financial Methods of Motivation (Cambridge (CIE) IGCSE Business)

Revision Note

Danielle Maguire

Written by: Danielle Maguire

Reviewed by: Steve Vorster

Non -financial Methods of Motivation

  • Non-financial incentives are rewards that are not directly related to money

  • These incentives may be intangible and include methods that lead to recognition, praise, job satisfaction or improved work-life balance

Types of Non-financial Incentives

Incentive Type

Explanation

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

Teamworking

  • Teamwork may involve workers completing tasks together

  • Teamwork can increase motivation in the workplace as each member of staff has a role and a shared goal

Training

  • Involves staff improving or learning new skills and abilities

  • This can make employees feel valued, more productive and likely to remain with the business

Promotion Opportunities

  • Employees offered promotion will feel recognised, have a higher status and will be given more challenging tasks/responsibilities to perform 

  • These benefits are closely linked to the views of both Maslow and Herzberg

Recommending a Method of Motivation

  • When recommending a method of motivation for employees in a business, managers must recognise that individuals are motivated in different ways

  • The following should also be considered

    • The context of the business

      • What type of business it it? E.g. manufacturing or sales 

      • The budget available 

      • How many workers does the organisation have?

      • Does the business currently use any methods of motivation?

      • What is the nature of the work of employees on a daily basis?

    • The balance of the compensation package

      • Ideally it should include both financial and non-financial 

      • It should be adaptable and reflect the changing needs of staff

Recommending a Method of Motivation

Business Scenario

Key Considerations

Recommendations

  • Workers in chocolate biscuit factory work long shifts on a busy assembly line. They are experiencing low morale 

  • Work is often repetitive and boring

  • Workers may feel that they are not gaining new skills in their role

  • Job rotation may allow workers to experience different elements of the production line which could increase motivation and skills

  • Some members of the sales department of a major perfume brand are feeling demotivated. They discovered that they have a lower base salary than their competitors

  • This is a competitive industry for employers who want to attract and retain the best marketing talent

  • The business will not want to lose the best employees to competitors

  • Increasing salaries may be costly

  • The business should increase salaries in line with those of its competitors in order to retain staff

  • Alternatively, workers may be motivated by a higher bonus for hitting their sales targets

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    Author
    Reviewer
    Danielle Maguire

    Author: Danielle Maguire

    Expertise: Business Content Creator

    Danielle is an experienced Business and Economics teacher who has taught GCSE, A-Level, BTEC and IB for 15 years. Danielle's career has taken her from across various parts of the UK including Liverpool and Yorkshire, along with teaching at a renowned international school in Dubai for 3 years. Danielle loves to engage students with real life examples and creative resources which allow students to put topics in a context they understand.

    Steve Vorster

    Author: Steve Vorster

    Expertise: Economics & Business Subject Lead

    Steve has taught A Level, GCSE, IGCSE Business and Economics - as well as IBDP Economics and Business Management. He is an IBDP Examiner and IGCSE textbook author. His students regularly achieve 90-100% in their final exams. Steve has been the Assistant Head of Sixth Form for a school in Devon, and Head of Economics at the world's largest International school in Singapore. He loves to create resources which speed up student learning and are easily accessible by all.