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A LevelBusinessAQARevision Notes6. Human Resource Management6.5 MotivationNon-Financial Methods of Motivation

Non-Financial Methods of Motivation (AQA A Level Business): Revision Note

Exam code: 7132

Lisa Eades

Written by: Lisa Eades

Reviewed by: Steve Vorster

Updated on

Non-financial rewards used to motivate employees

  • Non-financial rewards are motivators not directly related to money

Examples of non financial rewards include job enlargement, empowerment, job rotation, job enrichment, flexible working, team working, consultation, delegation
Examples of non-financial rewards

  • These incentives are usually intangible and include methods that lead to recognition, praise, job satisfaction, and better work-life balance

Incentive Type

Explanation

Link to motivational theories

Empowerment

  • Involves giving staff the authority and resources to make decisions and take action without first receiving management approval

  • Increases staff sense of ownership and responsibility, leading to improved productivity

  •  Maslow's 'Esteem' Needs as staff contribution is valued

  • A 'motivator' in Herzberg's Two Factor Theory (increase in responsibility)

Team working

  • Involves creating opportunities for staff to work collaboratively

  • Staff can share ideas and expertise, leading to improved productivity and innovation

  •  Maslow's Love & Belonging, as well as Esteem Needs

Flexible working

  • Involves offering employees greater control over when, where or how they work — e.g. remote work, flexitime, compressed hours

  • Improves work-life balance, which can reduce stress, lower absenteeism, and increase motivation and loyalty

  • Links to Maslow's hierarchy (social and esteem needs – respect and autonomy)

  • Also a 'motivator' in Herzberg's Two Factor Theory (sense of responsibility and achievement)

Job enrichment

  • Involves adding more challenging or meaningful tasks to a job

  • Staff feel more motivated and engaged, leading to improved productivity

  • A 'motivator' in Herzberg's Two Factor Theory

Job rotation

  • Involves moving staff between different roles in the business

  • Exposes staff to new challenges and experiences, which can increase motivation, understanding and skill

  • A 'motivator' in Herzberg's Two Factor Theory (the work itself)

Job enlargement

  • Involves expanding staff's job duties to include additional tasks or responsibilities

  • Engaging with a variety of tasks can increase motivation and job satisfaction, leading to improved productivity

  • Mayo's Human Relations Theory as it encourages the development of staff

  • A 'motivator' in Herzberg's Two factor Theory (the work itself)

Examiner Tips and Tricks

When asked to assess a compensation package on offer, consider the following before answering:

  1. The context of the business: Is it a manufacturing facility or a team of creative designers?

  2. The industry norms: Does the data provide any insight into what competitors are doing?

  3. The balance of the compensation package: ideally, it should include appropriate financial and non-financial incentives to maximise employee productivity and retention.

The case study usually provides good data, which helps you to answer the above questions, so refer to it as supporting evidence

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    Author
    Reviewer
    Lisa Eades

    Author: Lisa Eades

    Expertise: Business Content Creator

    Lisa has taught A Level, GCSE, BTEC and IBDP Business for over 20 years and is a senior Examiner for Edexcel. Lisa has been a successful Head of Department in Kent and has offered private Business tuition to students across the UK. Lisa loves to create imaginative and accessible resources which engage learners and build their passion for the subject.

    Steve Vorster

    Reviewer: Steve Vorster

    Expertise: Economics & Business Subject Lead

    Steve has taught A Level, GCSE, IGCSE Business and Economics - as well as IBDP Economics and Business Management. He is an IBDP Examiner and IGCSE textbook author. His students regularly achieve 90-100% in their final exams. Steve has been the Assistant Head of Sixth Form for a school in Devon, and Head of Economics at the world's largest International school in Singapore. He loves to create resources which speed up student learning and are easily accessible by all.