Incentive Pay
- Incentive pay helps in motivating employees, thus encouraging them to put more effort into their work.
Traditionally, money has always been used to solve the myriad organizational problems. However, incentive pays a can go a long way in solving some of the stringent company problems like low production and mismanagement. Other than money, employees also tend to get motivated by things like recognition, awards, and fair treatment. Organizations need to recognize its employees through incentive pays for their outstanding performances or when the company exceeds its target profit margins. This way, employees will feel encouraged and motivated to continue putting more effort into getting more rewards and recognition. For instance, Lincoln Electricity motivated its employees by adopting incentive pay programs. The results were increased production and profitability for the company.
- Employee ownership
- Employee ownership reduces the conflict between capital and labor.
- It also prevents an organization from experiencing a hostile takeover.
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Employee ownership programs allow employees to have individual percentage shares in the company. Employee ownership has two significant advantages: first, it reduces the conflict of capital and labor because employees, to some degree, act as both capital and labor to the company. That is, when employee ownership is correctly implemented, the company can effectively align the interest of its shareholders and employees. Secondly, employee ownership gives the employees to have shared within the company, which in turn can help the company fight off hostile takeovers.
- Information sharing
- Information sharing provides a guiding tool for employees to gauge their performances in line with the company objective.
If employees are a source of competitive advantage, then companies need to share certain information with their employees. These pieces of information may include the company’s goals and objectives, marketing strategy, developmental progress, or any other aspect of production. Availing these pieces of information to employees can act as their guiding tool to gauge their performances and make the necessary adjustment to achieve company objectives and goals.
- Participation and empowerment
- Participation and empowerment encourage employee loyalty to the organization, thus increasing their workout.
Empowering workers to participate in a company decision-making process increases both satisfaction and employee productivity. The current work environment discourages autonomy by removing the system of hierarchical control and coordination of activities. Instead, it encourages one that allows lower-level employees to take part in the decision-making process that affects their performance. This way, the employee will feel like part of the company and result in increased productivity. Nordstrom managed to stay competitive in the market through its open-door policy that encourages employees to share their concerns, suggestions, and ideas.
- Self-managed teams
- A self-managed team encourages workers to be more productive under peer monitoring and peer pressure.
Organizations need to tap into the power of teamwork. Creating a self-managed team within organizations transfers some of the management responsibilities to employees elected as team leaders. The self-managed team often works out in organization settings because of peer monitoring and expectations of coworkers that brought to monitor and coordinate work. Besides, under peer pressure organizations, employees tend to be more productive to meet the company’s objectives.