THE IMPACT OF FINANCIAL INCENTIVES IN GOVERNMENT OWNED ORGANIZATION IN NIGERIA

THE IMPACT OF FINANCIAL INCENTIVES IN GOVERNMENT OWNED ORGANIZATION IN NIGERIA

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND TO THE STUDY

The exponents of scientific management Taylor (2011), and his followers – maintained that the basic motive of man at work was economic. Money was seen as a principal motivation instrument. While the motivating power of money and material rewards could not be ignored, emphasis later shifted from economic man to social man. (Ezeani, 2015). This was the outcome of the Hawthorne experiment conducted by Elton Mayo at the Western Electric Company. The experiment drew attention to the effects of group membership and interaction on production, attitude and job satisfaction. The study gave rise to human relations movement which maintained that man does not just work for money, that other personal and interpersonal considerations, such as personal worth, recognition, friendship, social pressures from group members and status are powerful in determining production and level of job satisfaction. (Osuji,2015). In other words, it has become increasingly clear that beyond economic needs, man has some social-psychological needs that should be stratified in order to elicit behaviour towards increased productivity.

While the traditional theories of management as exemplified by the Scientific Management Movement, stress the motivating power of money and material rewards, the classical theories take note of the latter, but, lay greater emphasis on satisfying the psychological needs of the workers. Wage incentives and fringe benefits are motivational factors. According to Croft, (2016), motivation can be defined as “impulses that stem from within a person and lead him to act in ways that will satisfy those impulses” In other words, the concept, motivation, implies that there is some driving force within individuals, which drives to attempt to achieve a goal or objective, in order to satisfy their need or needs. (Croft, 2016). Therefore, to say that managers motivate their employees is to say that they do those things which they hope will satisfy those drives and desires and induce the subordinates to act in a desired manner. (Koontz et al, 2013). Alugbuo (2011) asserts that people work to get reward for their efforts. The exchange of labour for financial rewards is the heart of pay process. People do not put forward their best unless they get reward for their work, based on what the current social and economic climate dictates as fair.