Ways of motivating employees Cambridge IGCSE Business Studies revision
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In plain words
There are two ways to make a job more attractive: pay more for it, or make the work itself better. Businesses use both.
Which is best depends on the worker and the job. Money matters most to someone struggling to pay the rent, and less to someone who is bored.
4 things to know
- Financial rewards: a wage (paid by the hour or by the item), a salary (a fixed amount a year), a bonus (an extra payment for meeting a target), commission (a percentage of the sales a person makes) and profit sharing.
- Fringe benefits are extras that are not paid as money: a company car, free health insurance, staff discounts.
- Non-financial methods: job rotation (moving between tasks for variety), job enrichment (more interesting work with more responsibility), teamworking, training, and opportunities for promotion.
- Autonomy means giving employees freedom to decide how to do their work.
Tips and tricks
- Commission suits sales staff, because their sales can be counted. It does not suit a nurse or a teacher. Always fit the method to the job in the question.
- Piece rate, paying for each item made, raises output but can lower quality, because workers rush.
It lands in your notebook with its questions as flashcards.
Ways of motivating employees: 5 questions and answers
These are the quiz’s questions. Do the quiz first, then come back here for the ones that got you.
A car salesperson is paid 2% of the value of each car sold. This is
Commission is a percentage of the sales a person makes.
Which is a non-financial method of motivation?
It changes the work, not the pay.
Which is a fringe benefit?
It is a reward that is not paid as money.
What is a possible disadvantage of paying workers for each item they make?
Speed is rewarded, so care may be lost.
Job rotation means that workers
Variety reduces boredom.
Quiz
5 questions
Tap an answer and you’ll see straight away whether it’s right, and why.
Worksheet
3 questions, 8 marks. Write your answers on paper, then check them.
Ways of motivating employees
Cambridge IGCSE Business Studies 0450 · 8 marks · papermunch.org
Name ______________________________ Date ______________
Explain the difference between a wage and a salary.[2]
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A wage is paid according to the hours worked or the items produced, often weekly. A salary is a fixed amount for the year, usually paid monthly.
Explain why a business might pay its sales staff commission.[3]
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Commission is a percentage of the value of what each person sells. The more they sell, the more they earn, so they have a strong incentive to increase sales.
Explain how job rotation and job enrichment can motivate employees.[3]
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Job rotation moves workers between different tasks, which reduces boredom. Job enrichment gives them more responsibility and more challenging work, which gives them a sense of achievement.
Answers: Ways of motivating employees
- 1. A wage is paid according to the hours worked or the items produced, often weekly. A salary is a fixed amount for the year, usually paid monthly.
- 2. Commission is a percentage of the value of what each person sells. The more they sell, the more they earn, so they have a strong incentive to increase sales.
- 3. Job rotation moves workers between different tasks, which reduces boredom. Job enrichment gives them more responsibility and more challenging work, which gives them a sense of achievement.