Tathapi

ISSN:2320-0693
Vol-19-Issue-08-April -2020
(UGC Care Journal)

The Impact of Monetary Rewards on Employees Motivation and

Engagement in Manufacturing Sector

Pragati Srivastava

Humanities and Management Science Department,

Madan Mohan Malaviya University of Technology,

Gorakhpur, Uttar Pradesh, [email protected]

Dr. Priyanka Rai

Humanities and Management Science Department,

Madan Mohan Malaviya University of Technology,

Gorakhpur, Uttar Pradesh, India, [email protected]

ABSTRACT

The research study brings to light the impact of monetary rewards on employees‟ motivation and reveals
whether these incentives have the potential to increase engagement of employees working in
manufacturing sector of Uttar Pradesh. The data has been collected through questionnaire. Primary as
well as secondary data have been used for conducting the research. One hundred and forty-seven
responses were collected after circulating to one hundred seventy respondents. Data analysis has been
carried out with the help of graphs.

Therefore, within the limitation of the research conducted, the results explain that monetary rewards
have the potential to boost motivation among employees and their engagement towards the organization
in the manufacturing sector.

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ISSN:2320-0693
Vol-19-Issue-08-April -2020
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KEYWORDS: - motivation, monetary rewards, incentive, employee engagement, satisfaction,

commitment, money, organization, contribution.

INTRODUCTION

The human capital has always been accepted as a brain of any process organized in any form of
institution, corporation or organization. The organization success is very much dependent on its
competent workforce. Therefore, due attention is given to this factor in order to achieve success and
achieve strategic goals. For this it is significant that the employees are committed towards their job and
are full of energy and passion. Unfolding this process to the level of employees, it can be revealed that
the most important factor to the employees is the motivation. Hence, it is the responsibility of
organization‟smanagement to develop such strategies in order to reach the motivation level of
employees and help the organization to fulfill its goals and achievements.(Chaudhary & Ghosh, 2017)

Employees‟ engagement and motivation is a principal concern of any organization because the success
and failure of a business is very much dependent on it. A number of factors are supposed to be
responsible for the organization‟s success, in which the human resources or the employees play the most
important role(Waqas, 2014) . Managers should also recognize that all employees, whatever skills they
have, may not move up the hierarchy at the same pace if they lack motivation and hence, motivation also
plays a major role in the achievement of organization‟s goals. Employees Engagement is an argot
nowadays. It not only leads to retention of employees and higher productivity but it is also a key link to,
company‟s fame and position, customer satisfaction and overall stakeholder‟s value(Rao, 2017).

Monetary or financial rewards are provided in terms of monetary units to the workers for their efforts.
Money has been recognized as a chief source of satisfying the needs of the people. Monetary benefits
not only fulfil the physiological needs but also the need for social status and power. Money is regarded
as a basic and necessary incentive for individuals.(Naveen & Yenugula, 2017).

OBJECTIVES

1. To study the effect of monetary rewards provided by the organization on employees engagement

2. To study the influence of monetary rewards provided by the organization on motivation level of
employees.

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ISSN:2320-0693
Vol-19-Issue-08-April -2020
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LITERATURE REVIEW

Monetary Rewards

Armstrong bifurcated rewards in two classes: The financial or monetary rewards incorporate rewards
such as the basic pay and allowances, merit pay, bonus, productivity linked wage incentives, retirement
benefits and health allowances etc. He also specified that employees are remunerated on account of their
contribution towards the organization, skills and competency and their market utility(Harunavamwe &
Kanengoni, 2013).

Monetary rewards are developed to satisfy the basic human needs, encourage people to make out the
best performance in their work and enhance their competency level. They are designed as a means of
payment to enhance productivity, job satisfaction and improve employees‟ motivation.

Wallace and Zeffane(Harunavamwe & Kanengoni, 2013) argued that, management focus upon
rewards such as money and money is considered as the foremost constituent of motivation as per the
Need Hierarchy Theory given by Abraham Maslow. Money as a unique reward plays a big role in
satisfying different human needs -like need for food which is physiologic. David McClelland‟s in his
famous Acquired Needs theory advocated that money has been considered as a principal root of
performance assessment for high-need active person. Money is treated as a report card through which
employees can easily assess their services and the value provided by the firm against it, hence being an
important resource, it also results in individual motivation (Loureiro, 2016). Hence, money is pivotal
for encouraging motivation at work because it is that vehicle through which employees have the ability
to acquire numerous essential needs they desire for (Murphy, 2015).

Motivation

The term „motivation‟ has been inferred from the word „motive‟ which can be explained as anything that
initiates or sustains an activity(Ijaz, 2013). It is an inner more state that energizes, activates or moves,
directs or channelizes a person‟s behavior. Motivation is a cognitive condition that pushes an individual
in motion and directs him/her towards the fulfillment of certain objective and satisfaction of certain
necessities. It is the motivation through which managers pull strings and get employees to work towards
the success of the organization. In the word of Likert, “Motivation is the gist of management”. By
motivating the workforce, management establishes „desire to work‟ environment, engaging the members

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ISSN:2320-0693
Vol-19-Issue-08-April -2020
(UGC Care Journal)

of the group to work in the right direction, offer their loyalty to the group, execute properly the tasks and
duties assigned and plays an effective role in contributing to the purposes the organization has
undertaken.

Langton and Robbins (Loureiro, 2016) drew attention to the fact that an individual is motivated only
when there occurs difference between pay of a good performer and pay of an average performer.
Kanferet al.(Kanfer, 2012) related motivation with the workplace perception and stated it as a series of
activities which are basically used to drive a person‟s efforts, and determine those actions he/she will
use to carry out his/her desired outcome. This cognitive approach measures how individual can make a
move in the right direction, with great zeal and persistence in these actions.

RESEARCH METHODS

Methodology is a systematized process of collecting information to analyze and verify the given
phenomena. The study was carried with the co-operation of the management who permitted to carry on
the study and provided the requisite data.
Questionnaire was developed in Google form and was circulated at selected manufacturing companies.
Employees were requested to fill the questionnaire. One hundred and forty-seven responses were
received after passing on to one hundred seventy respondents. Neither the name of the respondent nor
the name of company was recorded for ensuring confidentiality.

1. Sample size – One hundred forty seven (147) employees from selected manufacturing
companies.
2. Sources of data
2.1 Primary data- Primary data is being used for the study and Questionnaire in Google Form is
prepared as a tool to collect the primary data.
2.2 Secondary data- Data collection through already published sources like different journals,
articles, some website etc.
3. Sample Size: The sample was selected on the basis of random sampling technique, drawn
fromManufacturing industry of U.P. A sample of 147 employees was collected and analysis is
done with the help of questionnaire.

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ISSN:2320-0693
Vol-19-Issue-08-April -2020
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RESULTS AND DATA ANALYSIS

1. Demographic Profile of respondents

Demographic Category Percentage

Variable
Male 79.7

Gender Female 20.3

Other 0

25 or below 25yrs 14.8

Age 26 to 40yrs 47.5

Yrs41 to 60yrs 37.7

Unmarried 30.5
Marital Status
Married 69.5

Less than 5yrs 16.4

Years of working 5- 10years 32.8

experience 10-20 years 31.1

>20years 19.7

Table 1: Demographic Analysis

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2. Satisfaction level of employees for various monetary rewards

Monetary Highly Satisfied Neutral (%) Dissatisfied Highly

Incentive satisfied (%) (%) dissatisfied
(%) (%)

Bonus 35.6 39 15.3 7.4 2.7

Medical 20.3 50.8 16.9 12 0
Benefits
Travelling 16.9 55.9 7.2 16.9 3.1
Allowance
Retirement 16.9 49.2 22 11.9 0
Benefits
Table 2: Employees Satisfaction

3. Do you think that it is important to be rewarded for the contribution you give to your
organization?

Yes No Neutral
84.70%

11.90%
2.40%

Figure3

The Figure 3 showed that maximum respondents (84.7%) agreed that it is important to be rewarded for
the contributions they offer to the organizations. However, a small portion (2.40%) disagreed and

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ISSN:2320-0693
Vol-19-Issue-08-April -2020
(UGC Care Journal)

11.90% were neutral in their statements. Employees are well aware of their work, and the contribution
they give to their respective organization and feel that their contributions must be rewarded.

4. Do you try to increase your work effort in order to achieve more rewards?

Yes No Neutral
81.40%

15.30%
3.30%

Figure 2

The figure 2 showed the proportion of respondents who improved and multiplied their work efforts to
gain more rewards.81.4% respondents accepted that they increase their work efforts, 3.305 disagreed
while 15.30 % gave a neutral response. This observation states that rewards are important to in order to
increase employee‟s contribution and get high production.

5. Do you agree that steady payment of monetary benefits increases your motivation towards work?
61%
28.80%

5.44%

4.76%

STRONGLY AGREED NEUTRAL DISAGREE STRONGLY

AGREED DISAGREE

Figure 3

The above figure 3 indicated that majority of the respondents agreed that steady payment of benefits is
important to increase motivation among employees towards their work. Therefore, it is the responsibility
of the organization to maintain the level of motivation among employees.

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ISSN:2320-0693
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6. Do you agree that employee‟s level of motivation and engagement to work is determined by the
structure of monetary incentives given to them?

49.20%
22%

22%

6.80%

0
STRONGLY AGREE NEUTRAL DISAGREE STRONGLY
AGREE DISAGREE

Figure 4

According to figure 4, 22% and 49.20% of the respondents favored a good structure of monetary
incentives in order to determine the employee‟s level of motivation and engagement. 22% of the
respondents were neutral whereas 6.80% disagreed. It was concluded that the higher the monetary
incentives, greater is the motivation and employees commitment towards work.

7. Do you feel that being motivated helps you to improve your engagement at work?
84.70%

11.90%
3.40%

YES NO NEUTRAL

Figure 5

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ISSN:2320-0693
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It was concluded from the figure 5, that employee‟s motivation and engagement are directly related to
each other. When employees are highly motivated, it creates “will to work” in the right direction among
employees, and energizes them consistently towards their goal.

8. Do you agree that monetary incentives are helpful in developing employee‟s attitude towards
organizational success?
44.10%
40.70%

13.60%

1.60%

STRONGLY AGREE NEUTRAL DISAGREE STRONGLY

AGREE DISAGREE

Figure 6

Attitude of an employee determines his state of work in the organization. It is important that employees
develop a healthy attitude towards the organization which in turns helps to firm to progress. Bad attitude
leads the organization towards the downward slope of success. From the figure 6 majority of employees
agreed that that monetary incentives help in developing employees, attitude

DISCUSSION

From the study it is clear that monetary rewards are influential when it comes to motivation and
employees‟ engagement. The mentioned question 4,5,6, fulfills the third objective of the research which
states that monetary rewards has influences and impact the employee‟s motivation whereas question
6,7,8, fulfills the second objectives which focusses on the monetary incentives and its impact of
employees‟ engagement and their commitment towards their goal. The study also reveals that monetary
incentives are provided to the employees in manufacturing sector and thus it is treated important by the
employees. It is clear that motivation and engagement are inter-dependable, if employees are motivated,

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ISSN:2320-0693
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it will automatically lead to commitment and engagement and will develop a positive attitude towards
the organizational success.

CONCLUSION

Based on the different literature reviews and the research findings, we can conclude that appropriate
monetary rewards encourages‟ employees to give best in their work performance. Work performance as
an outcome of employee‟s engagement, and employees‟ engagement is obtained if employees are
motivated. This motivation is a result of the different monetary rewards provided to the employees from
their respective organization. The result derived from the study shows similarity with the literature
reviewed. The majority of the respondents reported that they were satisfied with their incentives for their
motivation, commitment and engagement. A small number of respondents, however, were not satisfied
with the monetary incentives. In general, the results showed that providing additional monetary benefits
to employees could improve their motivation and work performance.

SUGGESTIONS

Organization in nothing, but people who work for it. When people perform work to the best of their
abilities, skills and talent with zeal, enthusiasm and commitment, organization grow to a large
proportion. When people fail to live up to their expectations, organization straggle in the competitive
race and get push to walls eventually. If the organization is able to exploit its human resources to the
best of their advantages, there is nothing that can stop organization form reaching the top of the ladder.
Therefore, it is very important that each and every employee of company contribute to the fullest and it
is also the responsibility of the company to care about theiremployees, lead them from front and bridge
gaps between employee expectations and organizational needs. From the above research observation, it
is seen that majority of the employees feel that monetary incentives play an important part in motivating
employees and engaging them for their work. But a few numbers of the employees also disagreed to the
mentioned fact. So, it is necessary to recognize each factor which lead to the motivation of people
working because motivation is a sole energy that can push people to work more and fulfill their personal
needs as well as the organizational needs.

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ACKNOWLEDGEMENT

Progress in life, business or any projects comes through taking initiatives & continuing to progress on
new concepts & ideas. The original momentum is not enough to keep you moving forward. Your
progress will grit to halt unless you refill your engine for inspiration with fuel of fresh ideas with
enthusiasm & proper guidance. Accomplishment requires the effort of many people and this work is no
different. I would like to thank all those who helped me directly or indirectly and whose diligent efforts
made this project possible.

I would like to thank the entire department for their help and guidance. Last but not the least; I would
like to thank my parents and friends for their kind support.

The research paper has not been funded or provided any grant numbers by any organization or
institution.

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