Topic 3 Retaining and Motivating - WordPress.com · 2015-11-03 · Retaining and Motivating Success...
Transcript of Topic 3 Retaining and Motivating - WordPress.com · 2015-11-03 · Retaining and Motivating Success...
Topic 3 – Retaining and
Motivating
N5 Business Management
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Learning Intentions / Success Criteria
Learning
Intentions
Retaining and
Motivating
Success Criteria
By end of this topic you will be able to
explain:
• methods used to motivate staff —
financial and nonfinancial
• how businesses minimise staff
turnover
• the importance of stable staffing.
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Incentives
Businesses can motivate staff by using financial and
non-financial incentives.
• Financial incentives - using money to motivate
people.
• Non-financial incentives - using methods other than
money to motivate people.
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Financial Incentives
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• Salary
• Time rate
• Overtime
• Piece rate
• Bonus
• Commission
Salary
• Paying a fixed amount of
money per year in 12 equal
instalments (once every month).
• The employee knows how
much money they will receive
each month, but there is no
incentive to work harder or
produce more. e.g. £18,000
salary (12 instalments of
£1,500)
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Time Rate
• Paying per hour worked.
• The more hours worked, the
more pay is received.
• However, when the
employee has not worked
many hours, they will not
receive as much money. e.g.
rate of pay is £6.50 per hour
and working 30 hours per
week (£6.50 x 30 = £195)
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Overtime
• Working over the minimum number of
hours required per week.
• Overtime is usually paid at a higher rate
than normal, e.g. time and a half or
double-time.
• The advantage is that overtime is
optional, so does not have to be done
and allows the employee to earn extra
money if they want to.
• The disadvantage is that it might not
always be available, it may depend on
demand and seasonal fluctuations.
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Piece Rate
• An amount of money for each
item produced in addition to a
low time rate or salary.
• The more items produced, the
more money will be earned.
• Encourages people to work hard
and produce more.
• However, the employee might
produce too quickly, in order to
get more pay, and the quality of
the work might become lower.
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Bonus
• Receiving an additional
payment on top of a
salary or time rate.
• A bonus might be paid
for very good work or
for meeting a target.
• Encourages people to
work hard.
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Commission
• A percentage of money paid
based on the value of sales
a person makes.
• The more sales made, the
more commission is paid.
• Encourages employees to
sell more but might place
pressure on the employee to
make sales; could cause
them stress.
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Non-financial Incentives
• Offering flexible working practices.
• Providing good pay and condition.
• Giving people extra responsibilities to encourage
them and providing promotion opportunities.
• Providing permanent contracts.
• Praising people for a job done well.
• Allowing people to work in teams and/or take part in
team-building tasks.
• Providing training opportunities.
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Why is motivation important?
• Staff turnover is lower.
• The quality of the product will be higher.
• Better customer service is provided.
• The reputation of the business is improved.
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Industrial Action
Industrial action can be
taken by employees
when they are unhappy
with their employment
terms and conditions or
working relationship
with their employer.
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Types of Industrial Action
Strike Employees refuse to enter the workplace. They might
have a picket line or demonstration outside the business
to raise awareness of the issues they are facing.
Work to rule Employees only carry out the tasks and duties written in
their job description and no other tasks are performed.
Sit in Employees refuse to work and ‘sit in’ the workplace.
Go slow Employees work slower than normal in order to reduce
productivity.
Overtime ban No hours above the minimum required (as per the
employee’s contract) are worked.
Boycott Employees refuse to carry out a new task or to use a new
piece of machinery.
Demonstration A gathering of people raising awareness of a particular
issue.
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Impact of Industrial Action
The impact of industrial action can be very
serious for a business.
• Production can stop or be slower and this
might give the business a bad reputation.
• Customers might be lost to competitors.
• The image and reputation of the business
might be damaged.
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