Academic journal article SA Journal of Human Resource Management

A Food-Manufacturing Manager's Experiences and Perceptions of the Implementation of an Incentive Scheme

Academic journal article SA Journal of Human Resource Management

A Food-Manufacturing Manager's Experiences and Perceptions of the Implementation of an Incentive Scheme

Article excerpt

Introduction

Key focus of the study

Motivation theorists attempt to explain what motivates employees (Bowey, 2005; Gordon- Rouse, 2004; Herzberg, 1968; Maslow, 1943; McClelland, 1987; McGregor, 1960; Vroom, 1964). Researchers make recommendations on how to use these theories to motivate employees (Brudney & Condrey, 1993; Forsyth, 2006; Kellaway, 2005; McCroskey, McCroskey & Richmond, 2005; Ramlall, 2004; Van Herpen, Van Praag & Cools, 2005). Furthermore, many researchers have linked incentive schemes to performance (Hansen, 2005; Lawler, 1990; Nelson, 2004; Nottage, 2006; Wagner, 2006). Therefore, it seems that researchers assume that incentive schemes motivate employees.

It is generally accepted that employees may achieve objectives and/or meet targets in return for monetary reward. Nevertheless, it appears that there is not much research on whether or not incentive schemes motivate employees and improve overall performance.

Employees may achieve set objectives and receive incentive bonuses, but have the incentive schemes motivated them? Are they willing to perform beyond expectations? 'As South Africa is now an international player, organizations will need to utilise performance management effectively in order to build sustainable competitive advantage through the performance of their people' (Whitford & Coetsee, 2006, p. 63).

The top managers of a South African food manufacturer introduced an incentive scheme in order to motivate all levels of managers to perform well. They expected the managers to feel elated, energised, euphoric and excited about achieving objectives and that they would work together to grow the company.

In this study, the researcher tried to explore the experiences, views and perceptions of 10 junior, middle and senior managers who were participants in the company's incentive scheme. The researcher gathered information using qualitative methods.

When asked how they felt about the incentive scheme, all except two participants in the research felt insulted, angry, despondent, irate and agitated. The researcher identified five themes that emerged during conversations with the participants. They explained the reasons for the negative feelings and lack of motivation of these participants and the positive feelings and motivation of the others after the implementation of the incentive scheme.

Background to the study

A British settler and his family established the company, where the researcher did the study, more than 150 years ago. Its focus on old family values, of caring for and nurturing its employees, eventually changed to one of making profit. Changes in the South African economic and political environments after 1994 caused this change. They led to increased pressure to compete with new international entrants to the food industry.

In 2003, its top managers introduced an incentive scheme to motivate all levels of manager to perform in order to meet these new challenges and make profit.

This study focused on the junior, middle and senior managers of the operations unit that is responsible for manufacturing the company's products.

The company's incentive scheme

All managers were entitled to a performance bonus that the company paid out bi-annually. The managers received their performance bonuses if they achieved their objectives. If the managers achieved their objectives, they received a bonus of 12% of their annual all-inclusive remuneration package.

The incentive is part of variable income (see figure 1).

Research purpose

This study aims to give some insight into the perceptions, views and experiences of the managers who receive incentive bonuses. More specifically, the researcher explored and described how the managers felt about the incentive scheme.

Therefore, this study will assist managers and directors to implement incentive schemes to motivate staff better and improve performance. …

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