INFLUENCE OF INCENTIVES ON TELECOMMUNICATION WORKERS’ PERFORMANCE IN THE WORKPLACE IN LAGOS STATE
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CHAPTER ONE
INTRODUCTION
Background to the Study
An incentive, according to Dalkir (2013), is something that motivates an individual to perform an action. Incentives, in the words of Armstrong (2007), are plans and rewards established by the management of a business organization which encourages employees to be proactive and to exhibit the right attitudes to work, thereby promoting organizational productivity. This reward system and motivating incentives will determine the level of employees’ commitment and their attitude to work. As noted by Dixit and Bhati, (2012) incentives packages have been a major factor affecting employees’ commitment and productivity.
Incentives propel and influence employees attitudes in the workplace and as well stimulate understanding between the employer and the employee which will consequently cumulate into improved performance for both the employees and the organization (Barbara, Bucklin & Alyce, 2003; Heneman, 2012). In Chiappori’s (2003) addition,an incentive is a reward for a specific behavior, designed to encourage that behavior. To apply Chiappori’s definition to the workplace, an incentive would then be an employee’s reward aimed at boosting sales, productivity and customer satisfaction.
Rock’s (2007) slightly varied perspective views incentives as ‘variable rewards granted according to variations in the achievement of specific results’ while Subramaniam (2012) sees incentive as a system of payment emphasizing the point of motivation, that is, the imparting of incentives to workers for higher production and productivity’. Smriti (2016) avers that ‘incentives are designed to stimulate human effort by rewarding the person, over and above the time-rated remuneration, for improvements in the present and targeted results’.
Employee performance, on the other hand, are the job-related activities expected of a worker and how well those activities were executed (Lings, 2004). Many business personnel directors assess the employee performance of each staff member on an annual or quarterly basis in order to help them identify suggested areas of improvement. Campbell (2003) added that performance is related to what an organization hires a person to do, thatthe activities that can be examined and measurable are reflected as performance. Smither (2008) added that, employee performance appraisal emphasizes on the performance variables of the employee and not on personal traits while Kane (2005) argued that employee performance is measured in terms of work-related behavior.
Satisfying an employee is done, not only through material means but also through non-material ones.As far as the employee’s motivation is concerned, employee motivational incentive programs have been found to be the most commonly adopted technique among organizations. The purpose of the program is to reward productive performance, reinforce positive behaviour and stir interest in employees (Richardson, 2009). Good performance and how it could it could be enhanced is central to the concern of industries and organizations, therefore many organizational scientists, are very much interested in different schemes and techniques related to performance. Incentives are one of those techniques used in workplaces to stimulate employees to give the desired performance.
The survival and success of any organization is determined by the way the workers are remunerated and rewarded (Lawler, 2003). The reward system and motivating incentives will, to a large extent, determine the level of employees’ commitment and attitude to work. As noted by Dixit and Bhati (2012), poor incentives packages have been a major factor affecting employees’ commitment and productivity. However, for any organization for achieve its objectives in any competitive society, employers of labour must have a thorough understanding of what drives the employees to perform efficiently and reward them accordingly (Mueller, 2011). Besides, employees must be motivated through adequate incentives plans and reward systems as this will invariably encourage them to be proactive and have the right attitude to work, thereby promoting organizational productivity (Armstrong, 2007).
Adequate incentives have been found to be one of the means an organization can adopt to motivate and increase their workers’ performance. There are many studies in the literature, which examine the monetary and non-monetary incentives and their effects on organizational variables (Al-Nsour, 2012; Scheepers, 2009; Pouliakas 2008; Pınar 2008; Arnolds & Venter 2007). Incentive programs are put in place by various organisations to compensate and reward performance of employees who perform more than expectation (Schiller, 2006). Incentive force employees to behave in certain ways and on any given day, they may choose to work as hard as possible at a job, to work just hard enough to avoid a reprimand, or to do as little as possible (Griffin,2002). Meanwhile, incentives are designed to get the maximum performance from the employees and help retain the most productive among them (Arnold, 2013). Organizations can consider a variety of ways to reward the employees for their work performance, but an organization needs to consider using the best employee incentives to get the desired results.
Incentives are an instrumental drive towards employee motivation and performance and it has great benefits and high potentials to motivate workers to put in their best in any giving task (Condly, 2003). “High productivity may be determined by workers employees’ ability to work and therefore employees that are not well rewarded produce less.” Some types of incentive plans are available in industries in which bonuses, conveyance allowance, medical allowance, increase in salary, monthly leaves, promotion, recognition are included. These incentives encourage the employees and hence, productivity is enhanced.
Recognition and reward programs refer to programs set up by a company to reward performance and motivate employees on individual and/or group levels. They are normally considered separate from salary but may be monetary in nature or otherwise have a cost to the company.
Motivational goal setting involves the development of an action plan designed to motivate and guide a person or group toward a goal (Grant, 2012). Goal setting can be guided by goal-setting criteria (or rules) such as SMART criteria. Goal setting is a major component of personal-development and management literature.Studies by Edwin A. Locke and his colleagues have shown that more specific and ambitious goals lead to more performance improvement than easy or general goals. As long as the person accepts the goal, has the ability to attain it, and does not have conflicting goals, there is a positive linear relationship between goal difficulty and task performance (Locke & Latham, 2006).
The Human Resources managers of organizations are primarily responsible for ensuring that tasks or duties are performed through employees in the right way. To achieve this, these managers must ensure that they have a competent personnel department for the recruitment of the best employees that are capable for the job. For the company to optimize employee’s performance, there is need for the employees to be sufficiently motivated. Inasmuch as motivation impacts on employee performance, there is need to blend the appropriate motivational tools with effective management and leadership to achieve this goal.
In highly dynamic organizations,such as Airtel Nigeria, incentives strategies are deployed by employers of labour to ensure that the best brains are retained in the best interest of the organization (Nelson, 2003). Consequently, productivity can only be enhanced if the employees are well motivated through adequate incentive packages that are proportional to their performance (Diener and Biswas, 2002, Michele and Rob, 2008). Meanwhile, to avoid wrong perceptions and controversy by the employees, reward system must be clearly communicated to employees with job measurement which will establish the much needed motivational drive in the employees (Hartman, 2011). Incentives propel and influence employees attitudes in the work place and also stimulates understanding between the employer and the employee which will consequently encourage spirited performance for the organization (Heneman, 2012). Employee satisfaction and performance are largely influence by incentives packages or reward system put in place by the organization (Osibanjo, Abiodun&Fadugba, 2012).
The whole thrust of incentive plans is to build the sort of highly trained, empowered, self-governing and flexible work force that companies today need as a competitive advantage. Employees desire appreciation and other monetary and nonmonetary incentives in exchange for a job done well. This trend is becoming more popular as businesses explore ways to motivate employees.
Workers need something to keep them at work. In most cases, the salary of the employee works as a stimulus; however, to keep the employee working constantly for an organization, other incentive packages and programs are also necessary. An employee must be motivated to work for a company, if not then that employee’s quality of work, or all work in general could deteriorate with time Some of the needs for incentives for an organisation are: to increase productivity; to drive or arouse a stimulus work; to enhance commitment in work performance ; to psychologically satisfy a person which leads to job satisfaction and avoid turnover ; to shape the behaviour or outlook of subordinates towards work increasing efficiency; to inculcate zeal and enthusiasm towards work; to get the maximum of employees capabilities so that they are utilized maximally to achieve organizational goals (Aderibigbe, 2013).
Incentive packages from companies to employees is expected to keep employees on their toes, prevent laxity and continually aim for the productive progress of the organization. This study promises to reveal how incentive packages can help companies achieve these.
Lagos State is home to the four telecommunication service-providing companies currently operating n Nigeria; namely MTN, Airtel, Globacom and Etisalat. Airtel Nigeria is selected for this study.
Airtel Nigeria
The V-Mobile (Airtel Wireless Nigeria Ltd) was issued with Global system of Mobile Communication (GSM) License by Nigeria Telecommunication commission in 2001. It started its operation on 5thAugust 2001. Airtel Ngeria’s head office is located Plot L2, 401 Cl, Banana Island, Lagoswith branches in Major cities of all the six geographical zone. The Board of directors has Mr. Salihu Belgore, as its chairman and chief executive officer.
Airtel Nigeria, formerly known as Celtel Nigeria was established by a group of institutional and private investors as well as three state governments. It made history by becoming the first telecoms operator to launch commercial GSM services in Nigeria.
Recently, it signed US$100 million equipment supply and financing contract with Motorola Corporation, and invested US$600 million in rolling out a nationwide GSM network over the next five years; the shareholders provided US$300 million in equity. The board has appointed international and local financial advisors, including HSBC and CSFB & AFREXIM Bank as well as First Bank, First City Monument Bank and Guaranty Trust Bank.
Airtel has installed base stations in various cities, namely Maiduguri, Enugu, Pos Ikot-Abasi, Aba, Bauchi and Calabar. It has also constructed microwave radio backbone from Lagos to Port Harcourt to enable the company to provide service to several cities in the densely populated south west, south East and the oil-producing Niger Delta. Airtel has built five switches in the country.
In 2006, following Celtel International’s acquisition of majority stake in the company, it was re-branded Celtel and became an important part of Celtel’s pan-African operations spanning 14 countries. On August 1, 2008 Celtel Nigeria was rebranded Airtel Nigeria following the global acquisition of Celtel International by AirtelGroup. Airtel Nigeria currently covers 1500 towns and 14000 communities across the six geo-political zones of Nigeria (airtelnigeria.com).
Airtel Nigeria was selected for this study for their accessibility and particular willingness to disclose information.
Statement of the Problem
Competition has heightened in 21st century business. More business owners are looking at improvements in quality while reducing costs. Meanwhile, current trends in the economy has resulted in a tight job market. So while businesses need to get more from their employees, their employees are looking for more out of them. Employee reward and recognition programs are one method of motivating employees to change work habits and key behaviors to benefit a business.Companies devise different strategies towards actualizing this, such as optimizing working conditions, establishing good communication between staff and employees, prompt payment of salaries etc.
Also, failure or inability of employees to make employees feel recognized and appreciated could lead to forfeiture of valuable employees through turnover. To prevent unwanted staff turnover and ensure continued productivity, organizations need to treat their employees to incentive packages that go beyond their normal remuneration.It is expected that packages would certainly motivate employees, stimulating them to think out of the box and be more creative. This is what this study aims to investigate.
Purpose of the study
The main purpose of this study is tofind out the influence of incentives on telecommunication workers’performance in the workplace in Lagos State. Specifically, this study aims to:
- Find out the impact of motivational goal setting influence the performance of employees at Airtel Nigeria
- Find out the influence of financial incentives on employee performance at Airtel Nigeria
- Examine the impact of recognition and reward programs on employee performance at Airtel Nigeria.
Research Questions
The following research questions would be answered in the course of this study:
- How does motivational goal setting influence the performance of employees at Airtel Nigeria?
- How doesfinancial incentives influence the performance of employees at Airtel Nigeria?
- How does recognition and reward programs influence the performance of employees at Airtel Nigeria?
Research Hypothesis
The following hypotheses would be tested in the course of this study:
Ho1: Motivational goal setting will not significantly influence the performance of employees at Airtel Nigeria
Ho2:Financial incentives will not significantly influence the performance of employees at Airtel Nigeria.
Ho3: Recognition and reward programs will not significantly influence the performance of employees at Airtel Nigeria
Significance of the Study
The findings of this study would enable companies to implement and enhance incentive packages that can motivate employees and improve performance. The study would contribute to the existing body of knowledge on the effect of motivation on employees. It will also help future scholars who will endeavor to undertake a study on motivation and performance.
Scope of the Study
The scope of this study covers the influence of incentives on employee performance. The span of the study covers telecommunication workers in Lagos State.
Delimitation of the Study
This study is delimited to 200 staff members of Airtel Nigeria Plc.
Limitation
This study is limited by time constraints, as the researcher has to divide her time between this study and her academic work.
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