Pros And Cons Of Monetary Incentives

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A monetary incentive is a cash reward given when an employee meets or goes above and beyond expectations. Rewards given include; bonuses, raises, profit sharing, gift cards and stock options. Monetary incentives are best used with employees who are driven or motivated by money. Monetary incentives are often used and are on the rise of use in organizations. They have been shown to be successful in many companies and organizations. The monetary incentive helps give a positive influence on the company’s productivity. The monetary incentive is used to motivate employees to perform better and also to increase productivity in companies and organizations (Bonner, S. E., & Sparkle, G. B. (2002). A monetary incentive plan has both negative and positive …show more content…
It helps motivate them to do better. It also helps motivate employees to improve at work. Another positive is that the monetary incentive can help nurture desirable behaviors in employees. Another pro of the monetary incentive plan is that it can increase productivity in the company or organization. Effort durations can be increased when using the monetary incentive plan in these organizations when employers use contracts. Employees are more likely to take fewer breaks and be more willing to work overtime while using this incentive plan (Gneezy, U., Meier, S., & Rey-Biel, P). Another positive effect is that individuals are willing to learn new skills that they need for future performance. Individuals are more likely to be better at strategizing and problem solving due to the increased effort that they put …show more content…
Maslow’s hierarchy of needs contains five levels, physiological, safety, belongingness, esteem, and self-actualization. Ed Brown, CEO of Patron tequila caters his employee’s lunch every day; this is an example of fulfilling the most basic level on Maslow’s hierarchy of requiring food, water, and oxygen. Safety is the second level in the hierarchy of needs. Safety is the need for a secure emotional and physical environment, Ed Brown, by accommodating to his religious employees and putting family first, has filled this need of

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