Are People Motivated by More than Money
Money has been used to help enhance the performance of employees in any given organization. There are other methods of motivating people other than the use of money. Rewards in organizations are believed to serve three major functions including, drawing, motivating and retaining employees. Rewards could impact greatly on an organization in ways ranging from the ability to employ and retain competitive employees to affecting how people feel, behave and their attitude towards the work (Harder, 2008). Evidently, money plays a major role in motivating people to work as it is the most common way to pay wages and compensate employees for the work done. Thus, it is only after the needs at the base of the hierarchy are met that the ones at the top become realized.
Abraham Maslow came up with the model for the purposes of personal development, training people on management as well as motivation of humans (Jensen & Meckling, 1994, pp. Second, REMM (Resourceful, Evaluative, Maximizing Model) is believed to be the best model that describes how and why people are rational, doing so in a systematic way. Moreover, it works to give a basis for how an institution is structured in terms of its finances, leadership as well ax organization. The Economic Model is more of money oriented in which humans are perceived as rational having desire for money only. An important aspect of Value Maximization is the inclusion of stakeholders. In an event that there are numerous objectives are present, it becomes difficult to measure progress.
This technique includes social welfare since the value added is a measure of a firm’s value social welfare. The basic principle of the Enlightened Value Maximization is that the ignorance and mistreatment of any significant constituent is an important value that will help in the maximization of the long-term market value. The Balanced Scorecard Theory has got numerous objectives. Brennan believes that an economic man is not a description of their behavior ad humans. There is more to the human behavior in this circumstances. People are concerned with so much more that happens around them. For instance, success or failure of whatever they do, feelings about what happens around them and also to them, honor from others, self-esteem, their ego and pride and at times shame and embarrassment.
Altruism suggests that people always care about other people more than they do care for themselves, something that Brennan implies. Therefore, conflicts are universal such that taking it for granted instead of considering its occurrence in reality is harmful to us. It’s possible that Brennan opposes the theory since it eliminates the fact that as situations change and people are different, their innate character or nature can be forced to change, either by themselves or others, to suit their interests as situations demand. Chang & Birtch (2011, pp. 562) suggest the alteration of institutional structures, contracts as well as official and formal arrangements as ways to help in the reduction of conflicts of interest, governing relations, increasing cooperation among employees among other benefits that can be achieved.
Motivating employees using monetary bonuses especially if the organization of a firm is improper has been found to be harmful. The success of an organization is a result of a variety of factors that could result into either the attracting and retaining of the highly skilled and qualified employees or their loss. Thus, it is essential that these organizations come to the realization that their employees are a crucial and precious asset, just like money and machinery, who can either cause the organization to make profits and progress or incur losses. Moreover, employees are well motivated by getting recognition and appreciation by their managers and supervisors when they perform well in their jobs. When employees are allowed to manage their own time, it gives them a sense of responsibility that helps in the motivation as well as the participation of employees resulting in good performance (Davidson & Mazibuko, 2011).
Most of the people get motivated by getting promoted to positions that offer s more challenging job, getting more and better opportunities, compensation packages, such as monetary compensations, as well as being in a conducive, properly manages and better work environments. Just as in all instances of incentives schemes, the establishment of awards is risky, making it a necessity to prevent the backfiring of poorly designed awards. The right motivation method would help solve fraud too. Many researchers have done as much studies as they can with the aim of finding out the real motive behind the behavior of fraudsters. The classic fraud triangle is derived from Donald R. Cressey’s work offering some suggestions on ways to counter fraud as well as giving the various factors that suggest fraud based on research findings.
First, both the employees and their superiors could engage in deception while formulating the budget resulting in the evisceration of the budgeting process together with the impartial information that’s necessary in the coordination of the core parts of an organization. Second, they play about with the realization of both the goals and budgets of an organization leading to the destruction of its value. Even though most superiors and analysts gamble with the budgets appreciating that the practice is common, only a few have the knowledge on the hefty costs it lays on the firm and the ways to reduce them. Jensen also notes that solving the problems could increase both the productivity and value if the company, with some organizations registering as much as 50-100% increment in productivity.
According to him, relying less on budget or target induced systems has resulted in the increase in production, particularly in the entrepreneurial and LBO firms. Moreover, the methods used to motivate employees by companies is key to the improvement of performance and as such, it is necessary for the managers to devise better ways to motivate their employees. ARTICLES SUMMARY Jensen, M. C. , & Meckling, W. H. Moreover, it works to give a basis for how an institution is structured in terms of its finances, leadership as well ax organization. In this model, human beings are seen to be resourceful and evaluating beings ready to maximize every opportunity at their disposal. The key aspect of thus model is the ability if humans to give up something, including their ideas and arguments, in exchange of something they desire and gave interest in.
There are differences in what they could trade about. The model has got four major postulates. For instance, Prohibition and CB radios. As stated earlier, this model shows that people in close to all instances give up something considered small for another that they consider better and bigger. A need is something that is a requirement offered at any cost, and which one cannot do without, for example, food is a basic need. Unlike wants that are so numerous, needs are few because they are a priority. Thus, planning is an essential practice, with respect to who should plan rather than whether people should plan. The interaction with a sociological perspective makes one view a situation from a different perspective. Using sociological imagination helps us to make conscious decisions knowing that social outcomes are based on what we do.
The things we do may affect the other people and thus lead to certain values, deeds, norms as well as situations that other people face. Pulling away from a present situation and thinking in an alternative way will help us to link our personal situations to public problems and look out for solutions in order to help the society we live in. The absence of a sociological perspective causes a state of indifference, a potential root of most of people’s problems. Abraham Maslow came up with the model for the purposes of personal development, training people on management as well as motivation of humans. The model is important in these recent days more than ever as it helps people achieve their own unique personalities.
Therefore, with the growth of scientific research in how humans behave in the world today, all humans can be seen to be resourceful, evaluating and maximizing creatures, regardless if profession, education level, age, social status, gender and even racial background. They will certainly react to the environment they find themselves in taking advantage of the resources presented by the environment to get what they want. They do not only care about monetary gain but almost every other thing, power, pleasure, respect, honor, love among others. Incentives are the choices that people make to acquire or achieve anything that they are in need of or want. The presence of incentives greatly influences the performance if people in any given organization. Rational people choose what they like the most and what makes them feel better off and what makes them feel satisfied.
Anti-incentives refers to the situation in which there is lack of incentives and/or conflict of interest. The presence if incentives mean that in all cases, people are given an opportunity to choose what they want, a situation that is evident both in organizations and as a natural factor in our everyday life. Brennan categorizes altruism as a “non-self interested behavior”. However, Jensen terms this categorization as a wrong one. This is because people do not always care about other people more than they do care for themselves, something that Brennan implies. According to Jensen, it is true that people have some sense of humanity that drives them to show concern for others but thus does not mean that they are perfect agents as they also have their own needs, therefore they cannot completely care for the needs of others at their own expense.
Jensen gives evidence of thus fact giving instances of constant conflicts and abuse, both verbal, emotional and physical, in families, sexual abuse and assaults as well as the failure of organizational control systems. 2139/ssrn. 220671 The Stakeholder Theory states that any firm or organization is a link of contracts. According to Jensen, this theory is the best design that offers the greatest assistance in negotiations and the management of different kinds of contracts. When compared to other organizational forms this is the most successful and well-known. Analysis of the theory describes that there are great differences in the stakeholders, there are differences in the contracts in terms of their weaknesses and strengths. Moreover, it is the outsiders who perform the actual regulation particularly in the market.
In addition, the theory is tribal as people always interact with those they know rather than those they don’t. The basic principle of the Enlightened Value Maximization is that the ignorance and mistreatment of any significant constituent is an important value that will help in the maximization of the long-term market value. Finally, Jensen criticizes the Balanced Scorecard Theory majorly because it has got numerous objectives. Moreover, he states that the theory doesn’t clearly connect rewards and punishments giving no precise information concerning tradeoffs. Gen X enjoy the fast pace environment and being confronted with new trials. Finally, Gen Y value firms that provide monetary incentives and a good work environment. Unlike Gen X, Gen Y is less concerned about learning and being intellectually challenged.
Much of these differences are due to age difference, the different existing motivation factors, and gender. However, there are several people who oppose this point of view between Baby Boomers, Gen X, and Gen Y. Finally, Gen Y are heavily interested in getting monetary compensated. Finally, upon studies made, it was concluded that all generations are motivated intrinsically, that extrinsic motivator depend on work field, gender, and education, and that “all generations have the same order of effects on financial success” (Yanki and Surya, page 7); hence, monetary incentives is important. Hilmarsson, S. T. , & Rikhardsson, P. Innate motivators have been shown to be better and considered to have more value than external ones making managers and superiors encouraged to motivate their employees using these incentives.
Since incentive systems and the successful adoption of a strategy are closely related, the alteration of one could have a great impact on the other. This research on incentives is a very important subject giving alternatives to the use of monetary bonuses to reward and motivate the employees to enhance their performance. The world is constantly changing with people realizing threat they need more than just money to cater for their needs and as a motivation to keep working better. Thus, having a thorough knowledge of nonmonetary rewards is a very important aspect that needs to be explored better. A. The Performance Implications of Financial and Non-Financial Rewards: An Asian Nordic Comparison. Journal of Management Studies, 49(3), 538-570. doi:10. 1111/j. In addition, even if people are instilled with more altruism, showing concern for others more than our own selves, problems emanating from agencies could be difficult to solve.
Thus, showing concern for others doesn’t make people perfect agents simply because they just do bidding for others. As such, it is impossible or near to impossible to change the nature of humans in the near future. To add, there has been no success to do so in the past years despite the efforts made by the largest religions in the world leaving doubts to many as to whether the human nature can ever be changed in any possible way. Chang & Birtch suggest the alteration of institutional structures, contracts as well as official and formal arrangements as ways to help in the reduction of conflicts of interest, governing relations, increasing cooperation among employees among other benefits that can be achieved.
Cressey’s work offering some suggestions on ways to counter fraud as well as giving the various factors that suggest fraud based on research findings. The Fraud Triangle is the most popular theory that tries to explain the phenomena surrounding commission of a fraud. Cressey explains what motivates people to commit fraud paying much respect to the trust violators in his research. The model was termed the Fraud Triangle although Cressey never came up with the term himself. The triangle identifies three key issues that are commonly associated with and result into fraudulent behavior, including opportunity, pressure and rationalization. In addition, the elements and reasons behind fraud will not always be the same as the nature and extent of fraud will always keep changing.
Thus, the Fraud Triangle remains a helpful tool in the study of the psychology of fraud and should be considered as such, even though there are various theories that support it and give a more extensive explanation of fraud motivation. As humans have their own weaknesses, almost everybody has the capacity to go against the ethical code of conduct as well as the commission of fraud. It’s not only those who are in the constant habit of crime commission that can engage in fraud. For the better of organizations and their ultimate growth, they should keep a constant eye on fraudulent behavior at all times as this is a pervasive behavior. Growth has been realized with the increment in the adoption of a highly aggressive model of public interest that is focused on ensuring awareness of information and methods of proliferation with respect to national policy reforms that bring to light the government’s shortcomings, such as bureaucracy.
This takes place in a way similar to the advancement in scientific research, technology and economic sophistication. Since then, a number of researchers have studied, written as well as debated over the model, with much attention being paid on its merits, a move that has increased our appreciation of the model as well as how it can be applied in behavioral economics. Environmental law is one of the most researched reformed model together with its accompanying movement of public interest. The effects the model has on private and incentives that are self-sustaining in the current institutions that make laws make it a very interesting model to study. The unique aspects that both financial and environmental laws regulate explain the relevance and appropriateness of the analogies of the reforms in the two areas.
Owing to the complexity in the science behind the environment, the understanding and acceptance of the theories that explain the detriment resulting from the environment that the public has keeps changing from time to time. For instance, global warming has been a subject that has raised so much concerns over the years resulting in the change of the subject from just a theoretical assumption to something scary. In the same way, the financial world (market) has evolved both as the regulator and the regulated to help enlighten our minds on the aspects that could help manage risks from losses. However, it is difficult to solely put our faith in innovation in any financial model before the proper appreciation of the underlying and advanced economics and mathematics.
First, both the employees and their superiors could engage in deception while formulating the budget resulting in the evisceration of the budgeting process together with the impartial information that’s necessary in the coordination of the core parts of an organization. Second, they play about with the realization of both the goals and budgets of an organization leading to the destruction of its value. Even though most superiors and analysts gamble with the budgets appreciating that the practice is common, only a few have the knowledge on the hefty costs it lays on the firm and the ways to reduce them. The main aim of Jensen’s research is to explain how a firm and its heads could bring an end to the counter-productive cycle.
Destruction of the budgetary systems won’t help solving the problem but changing the ways that employees are paid in any given organization. An Investigation on Employee Participation in the Workplace: A South African Case Study in the Nelson Mandela Bay-Eastern Cape Region. SSRN Electronic Journal. doi:10. 2139/ssrn. 1906605 For an organization to succeed and progress, there are a broad range of aspects, both intrinsic and extrinsic, that it should consider. When employees are allowed to manage their own time, it gives them a sense of responsibility that helps in the motivation as well as the participation of employees resulting in good performance. Regardless if the tool used in motivation, it has been proven that the level of motivation greatly impacts on the level if performance.
Harder, J. Organizational Reward Systems. Darden Case No. ” However, the paper dwells majorly non monetary rewards and its effects. Karaskakovska, S. Analysis of the Employee Motivation Factors: Focus on Age and Gender Specific Factors. SSRN Electronic Journal. doi:10. Ariely, D. , Bracha, A. , & Meier, S. Doing Good or Doing Well? Image Motivation and Monetary Incentives in Behaving Prosocially. American Economic Review,99(1), 544-555. Practices, visualizations and personal opinions are the major constitutions of image motivation. However, the mechanism of the formation of the image remains unknown. The study also evaluates the differences between image motivation and monetary motivation. The two have varying effects with the image motivation providing a greater sense of motivation. Fehr, E. In addition, a damaged perspective of the relative performance of various incentives would be created as non-monetary motives interact in various ways with the kinds of incentives.
Three major motives have been described to explain the claims in a better way. They include, the desire for reciprocation, achieve social acceptance as well as gain the inner satisfaction from working on something one likes the most. Fehr & Falk wanted to show that economists could gain a better appreciation on how incentives are driven by some psychological forces through explaining how these motives connect with the nonmonetary incentives. Fehr &Falk have worked to get her to prove that if there are losses in aversion, tournaments as incentives would have their effectiveness reduced and ultimately lead to the decrease in wages. doi:10. 2139/ssrn. 1021208 Even though non-monetary incentives have been used widely for quite some time to reward good performance and as a source of motivation, economists have done very little concerning it.
Neckermann & Frey did an online IBM research assessing outward incentives. Having a new way of rewarding good performance has shown to have significant impact on its contribution to the good of the public. , & Meier, S. Doing Good or Doing Well? Image Motivation and Monetary Incentives in Behaving Prosocially. American Economic Review,99(1), 544-555. doi:10. 1257/aer. An Investigation on Employee Participation in the Workplace: A South African Case Study in the Nelson Mandela Bay-Eastern Cape Region. SSRN Electronic Journal. doi:10. 2139/ssrn. 1906605 Eckhart, S. doi:10. 2139/ssrn. 2596825 Harder, J. Organizational Reward Systems. Darden Case No. doi:10. 2139/ssrn. 1965646 Jensen, M. C. Self Interest, Altruism, Incentives, and Agency Theory. C. Paying People to Lie: The Truth About the Budgeting Process. SSRN Electronic Journal. doi:10. 2139/ssrn. SSRN Electronic Journal.
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