HCM 433 MANGEMENT AND ORGANIZATIONAL BEHAVIOUR.pdf

Thirdly, it is almost certainly true that money can motivate only when the prospective payment is
large relative to a person’s income. The trouble with many wages and salary increases and even
bonus payments, is that they are not large enough to motivate the receiver, they may keep the
individual from being dissatisfied and from looking for another job, but unless they are large
enough to be felt they are not likely to be a strong motivator.
Fourthly, it is probably quoted that in most kinds of business and other enterprises; money is used
as a means of keeping an organization adequately staffed and not primarily as a motivator.
Various enterprises make wages and salaries competitive within their industrial and their
geographic area so as to attract and hold people.
Fifth, money as a motivator tend to be dulled somewhat by the practice of making sure that
salaries of various managers in a company are reasonably similar, in other words, we often take
great care to be sure that people on comparable levels are given the same or nearly the same
compensation, this is understandable since people usually evaluate their compensation in the light
of what their equals are receiving.
Limitations
Money can be used as a reward even if it would not have been sufficient to motivate performance
in the first places. Thus money can be used as a symbol of appreciation or approval even under
those conditions where its intrinsic value is not greatly appreciated. However, whether or not
money is valued for its intrinsic purchasing power, the limits of the use of money as a special
motivational technique are important.
1. Money rewards are costly to the enterprise. There are likely to be cheaper ways (and ways
which do not attract income tax) by which to reward satisfactory performance.
2. Once money has been used as a signal for motivation, it is likely that it will be expected
again, and it may be difficult to discontinue the practice. Moreover expectations may
spread through the organization making it difficult to resist the use of money for other
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