1.1 Background to the Study
Every organization whether big or small is formed to achieve specific goal(s) and that such organization’s objectives can only be achieved through the employment and retention of qualified human resources at its disposal (Achie and Kurah,2016). In order to achieve the organizational goals and objectives, certain motivational factors must be put in place to spur employees to put in their best in their work place. Linda (2001) posits that financial incentives mean any inducement involving the payment of money and reduction in price paid for goods or services or any award of credit. In the theory of human behaviours, it is believed that everyone seems to inherit certain basic drives similar to those found in the nature of animals. People are often unaware of the urges, which lie in the conscious mind that forces people to act in certain ways. If this urge is suppressed, frustration occurs and unless something is done, the person suffers depression and his zeal is weakened. All incentive inclinations cause people to behave in certain patterns, this means that in every organization the employees behaviour determines the level of the incentives been given to them by the employer or the management. This seriously makes relationship between the employees and the employer to be threatened, unless the organizational incentives are understood and used properly. The importance of financial incentives to higher productivity has influence the choice of this research works and data collected fully tried to analyze to come up with findings and recommendation that will stand the test of time.
Financial incentives and rewards positively affect on employees commitment or loyalty. Employees stay in an organization because of the cost for leaving the organization and benefits to be a part of the organization. Therefore it is important for the organization to maintain the relationship with employees in such manners which increase their loyalty with the organization. Financial incentives and rewards make continuation of the employment relationship because it create the basis for high levels of commitment so, firms must develop strategies that include financial incentives and rewards for example promotion, bonus, profit sharing or gain sharing and employees stock ownership etc (Development and Learning Organization, VOL.25 NO.1, 2011). Employees want their performance should be appreciated and by offering them appropriate rewards and benefit package is an effective way not only to achieve their organizational goals but also their continuation of relationship with talented employees.
1.3 Statement of the Problem
Right from the beginning, management of organizations has always been faced with the problem of how to motivate worker in order to increase productivity that leads to profitability. Wealth or profit minimization is the goal of most organizations. This is however only achieved when shareholders or investors funds are invested with a higher return on their investment, which is only possible when that organization is able to effectively motivate its workforce to make profit (Henry, 1998).
Whiting (1963) posits that most organizations actually fail due to their inability to adequately motivate their employees for higher productivity ironically; human resources form a greater percentage of the total assets of organizations. The management of financial incentives is a very critical issue that should not be over looked, as its neglect can lead to disruption of work process, sales and service delivery loss and consequently financial losses. The problem at hand therefore is to examine the organizations in Nigeria to see whether they really make use of financial incentive to their employees for higher productivity which transform to high profitability.
1.3 Aim and Objectives of the Study
The broad objective of this study is to critically appraise the relevance of financial incentives to workers motivation while the specific objectives are:
i) To ascertain the extent of financial incentives operation in the University of Lagos.
ii) Look in to the various financial motivators in the University of Lagos.
iii) To ascertain the manner in which financial incentives are carried out successfully in the University of Lagos
iv) To determine the extent salary increase, and financial bonuses have influenced the workers motivation
1.4 Relevant Research Questions
The principal question of this research is what factors influence financial incentives with regards to workers motivation? This research will also try to provide answers to the following sub-questions in the course of this study:
1. What is the extent of financial incentives in operation in the University of Lagos?
2. What are the financial motivators in University of Lagos?
3. What is the manner in which financial incentives are carried out successfully in the University of Lagos?
4. To what extent has salary increase, and financial bonuses influenced the workers motivation?
1.5 Relevant Research Hypotheses
Ho: Financial Incentives has no significant impact on workers motivation
H1: Financial incentives has significant impact on workers motivation
Ho: Salary increase and financial bonuses have no impact on employees’ motivation
H1 :Salary increase and financial bonuses have no impact on employees’ motivation
Ho: Financial motivation does not have significant impact on employees’ productivity
H1: Financial motivation have significant impact on employees’ productivity
1.6 Significance of the Study
The importance of this study will include but not limited to the following:
i) It will increase the understanding of strategies for improving engaging and motivating workers
ii) It will promote an atmosphere of peace and a feeling of equity and employee-centric management.
iii) It will also impart on the students generally.
1.7 Scope of the Study
The scope of this study covers financial incentive in higher productivity with particular focus to the Staff of University of Lagos. By choosing University of Lagos Staff, the researcher will be able to assess the impact of financial incentives which will enable him to ascertain its contributions, and impact on the motivation of their staff, which will also provide a basis for making objective conclusions.
1.8 Definitions of Terms
Motivation: Motivation can also be defined as one’s direction to behaviour, or what causes a person to want to repeat a behaviour and vice versa.
Financial Incentives:Monetary benefit offered to consumers, employees and organizations to encourage behavior or actions which otherwise would not take place.
Employee: An employee contributes labour and expertise to an endeavour of an employer or of a person conducting a business or undertaking
Productivity:Productivity is an average measure of the efficiency of production. It can be expressed as the ratio of output to inputs used in the production process, i.e. output per unit of input.
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