After reading this article you will learn about the financial and non-financial incentives that are given to motivate workers.
Financial or Monetary Incentives:
This means to give more money and incite to more work as money is the important motivating factor. The main objective of that one who works more, is to get more. A financial incentive motivates more than non-financial incentive.
Monetary incentives include wages, salary, bonus, prize, income on investment and dividend. In this way, car or anything in the form of wealth is known as monetary incentive.
Monetary incentives can be for the positive or negative work i.e., amount given to increase production or to do a work in monetary incentive as on more production more bonus, prize etc. At times, for not doing a work or doing less work, prize is given as on less absence misc, expenses lessening or if done more deduct from their income as fines.
Monetary incentives may be given personally or collectively.
Non-Monetary or Non-Financial Incentives:
Non-monetary incentives mean all social and psychological attractions by which the workers are incited to accomplish the best and more work. This is an all recognised fact that money is though an important greed but workers do not work for money only, they take incentive to satisfy social and psychological satisfaction.
The following elements are included under non-monetary incentives:
(ii) Social reputation
(iii) Chances of promotion
(iv) Recognition of work
(v) Job security
(viii) Team spirit
(x) Human relations
(x) Personal esteem
(xi) Participation in industrial management
(xii) To give responsibility; and
(xiii) To give chances of constructive work.
These non-monetary incentives improve the labour interest in work, minimise accidents and create interest in industries.
Non-monetary incentives can also be personal or collective. Non-monetary and monetary incentives give benefit to labour classes, consequently workers have increased honour and wages.
Financial incentives differ from non-financial incentives in the following ways: