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Income as Incentive

An Examination of Money as a Motivator Among Top Tier Employees

 

FEATURED PAPER

By Steve Ford

Colorado, USA

 



Abstract

The question of how managers can utilize monetary motivational methods to effectively inspire top-tier employees ($75,000/yr or greater) is examined based upon a literature review of the body of knowledge. The literature suggests that motivation by compensation can be effective for low-interest workers but is relatively ineffective for top-tier employees. Rather, the consensus is that monetary compensation can only be effective if narrowly tailored to empower employees to satisfy their higher needs. Thus, by enabling their top-tier workers to reach their overarching life goals, managers can effectively motivate them, resulting in greater levels of organizational success with lower employee turnover.

Introduction

Motivating top-tier employees is a complicated prospect. Educated, highly skilled employees and managers have historically presented conflicting research data versus lower skilled employees regarding monetary compensation and motivation. This problem of effectively utilizing monetary compensation to motivate top-tier employees is the focus of this work. Top tier employees are defined as earning more than $75,000 in salary. The purpose of this paper is to utilize recent research to demonstrate that compensation packages can, under certain circumstances, be utilized to motivate top-tier employees. The body of knowledge surrounding monetary incentivization, in general, is extensive and well-established. Scientific research of motivation theory in the early 1900s led to several breakthroughs regarding motivation science in the mid-twentieth century. Recent research built upon these foundations to further our understanding of motivation, its constituent parts, and how monetary compensation factors into the comprehensive motivational construct. These theories have recently been applied to workers earning more than seventy-five thousand dollars per year, with findings suggesting that it can be useful within narrow parameters.

This researcher’s conclusions include exploring a causal chain between the hierarchy of needs, emotional well-being, intrinsic motivation, job performance/satisfaction, and achieving organizational goals with lower turnover among top-tier employees. Potentially, these findings provide managers with a theoretical base from which to motivate their top-tier personnel, yielding higher goal achievement and lower turnover. Further recommendations include a series of studies focused on verifying this causal chain, affective and cognitive components of motivation, and specific methods to motivate top-tier employees.

Questions Explored in the Research

Reviewed research generally addresses a version of the following two research questions when examining monetary incentives in motivation theory. These questions are 1) Under what conditions can money be an effective motivator and 2) How can one motivate highly-paid, highly-skilled top-tier employees?

Literature Review

Taylor (1914) argued that pay mainly motivates workers via his scientific management theory. He based his model off of certain assumptions regarding the workforce in general. First, he argued that workers do not like to work and therefore require high levels of control. In other words, the controlling phase of management plays a large role in Taylor’s (1914) theories. Secondly, he stated that workers are more efficient when given small repetitive tasks and appropriate tools and training to accomplish those tasks. Simply put, Taylor (1914) recommended specializing workers on a single task and training them on how to accomplish the task as efficiently as possible. Thus, each worker and subtask is completed as quickly and accurately as possible, yielding efficient master tasks. Third, he argued that workers should be paid for each task completed or piece produced, not hourly (Dean, 1997). In this way, the worker in a low-interest tasking is motivated purely by compensation. Furthermore, Taylor (1914) argued that workers should not be punished for small mistakes, but rather rewarded for small successes. Various manufacturers applied Taylor’s techniques to assembly-line operations, most notably at Henry Ford’s, with great success (Riley, 2018).  However, one must note this theory and its success applied only to the line-worker level of the organization, not the management team (Dean, 1997). Furthermore, there are some critiques of Taylor’s work regarding the relegation of workers to essentially robots (Riley, 2018). Taylor’s (1914) theories are seen by Riley (2018) as highly effective for assembly-line applications, but not for traditional management problems. In other words, one cannot use scientific management if one expects subordinates to be part of a creative team. In any case, from Taylor’s foundation, research began to build towards the human relations school of thought.

Mayo, considered by some to be the father of human resources, first presented his theory of employee motivation in 1933 (Dininni, 2017). He based it on his now-famous Hawthorne studies. His theory differed from Taylor’s in that Mayo stated that employees are motivated significantly more by intrinsic than extrinsic factors, particularly compensation. Notably, Mayo found that workers desired to fulfill what Maslow would later term “higher needs.” …

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How to cite this paper: Ford, S. (2019). Income as Incentive: An Examination of Money as a Motivator Among Top Tier Employees; PM World Journal, Vol. VIII, Issue II (February).  Available online at https://pmworldjournal.net/wp-content/uploads/2019/02/pmwj79-Feb2019-Ford-Income-as-Incentive-featured-paper.pdf

 



About the Author


Steve Ford

Colorado, USA

 

 

 

Steve Ford holds a BS from the US Air Force Academy (2004), an MS in Space Studies from the University of North Dakota (2009), and is currently in the Doctorate of Management- Project Management program at Colorado Technical University (2021). Steve is currently the managing member of Advanced Applied Project Management Solutions (LLC), a project management consultant firm. He holds numerous project management-related qualifications, including Project Management Professional (PMP), Lean Six Sigma Black Belt Professional, Project Management- Lean Process Certified, Lean Supply Chain Management Certified, and Lean Culture Certified. He has more than 18 years of aerospace and construction experience in project management.