Monetary Motivational

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SUMMER TRAINING REPORT

ON

A HOLISTIC STUDY OF MONETARY MOTIVATIONAL TOOLSFOR PRODUCTIVITY ENHANCEMENT

at

ITC Ltd. SIDDKUL

HARIDWAR (UTTRAKHAND)

SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE AWARD OF

THE DEGREE OF

OF

U.P.TECHNICAL UNIVERSITY, LUCKNOW

B Y

SATENDRA SINGH TOMER

ROLL NO.0807270123

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ACKNOWLEDGEMENT

This project is a culmination of task undertaken by me during the tenure of

eight weeks at ITC limited as a project trainee.

Acknowledgement is not a mere formality or ritual but a genuine opportunity to

express the indebtedness to all those without who’s active support and

encouragement this project wouldn’t have been possible. My special thanks to

Dr. P.K. Gosh (Director), Mr. Farzan Ahmed who helped me for a proper

guidance.

The General acknowledgement goes to the Management of Videocon

industries limited where I have got the ample opportunity to undertaken the

study and completion of this project.

I would like express my thanks to Mr.Arun Raghav (H.R HEAD) for his

guidance and cooperation rendered for allowing me to undergo training under

his guidance.

My special thanks to Ms. Aparna for her active support, affectionate guidance

and constant encouragement. They helped me in getting all required notes,

required by my project.

I’m highly indebted to Ms. Anubhuti Dwivedi (Program Co-ordinator of

MBA dept.) for her continuous effort in building a good infrastructure and

develop a professional attitude within ourselves during the academic period of

MBA.

Diction is not enough to express my guidance to my parents who have molded

my career through enormous sacrifice throughout the years.

Satendra Singh Tomer,

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INTRODUCTION

MOTIVATION

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Motivation - key to performance improvement

There is an old saying you can take a horse to the water but you cannotforce it to drink; it will drink only if it's thirsty - so with people. They will dowhat they want to do or otherwise motivated to do. Whether it is to excel onthe workshop floor or in the 'ivory tower' they must be motivated or drivento it, either by themselves or through external stimulus.

Are they born with the self-motivation or drive? Yes and no. If no, they canbe motivated, for motivation is a skill which can and must be learnt. This isessential for any business to survive and succeed.

Performance is considered to be a function of ability and motivation, thus:

Job performance = (ability) x (motivation)

Ability in turn depends on education, experience and training and itsimprovement is a slow and long process. On the other hand motivation canbe improved quickly. There are many options and an uninitiated manager may not even know where to start. As a guideline, there are broadly sevenstrategies for motivation.

• Positive reinforcement / high expectations • Effective discipline and punishment

• Treating people fairly• Satisfying employees needs• Setting work related• Restructuring jobs• Base rewards on job performance

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Meaning and Definition of Motivation

According to Dublin,

“Motivation is the complex forces starting and keeping a person at work in an organization. Motivation is something that moves the

person to action, and continues him in course of action already.”

According to McFarland,

“Motivation refers to the way in which urges, drives, desires,

aspirations, strivings, or needs direct, control or explain the behavior

of human beings.”

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Motive Motivating Motivation

Needs in

individuals

Activating needs and

providing needs

satisfaction environment

Engagement in work

behavior



Nature of Motivation

Based on the definition of motivation, we can derive its nature relevant for

human behavior in organization.

1. Based on Motives. Motivation is based on individual’s motives which

are internal to the individual. These motives are in the form of feelings

that individual lack something.

2. Affected by Motivating. Motivation is affected by way the individual

is motivated. The act of motivating channelizes need satisfaction. It can

also activate the latent needs in the individual.

3. Goal-directed Behavior. Motivation leads to goal-directed behaviour.

A goal-directed behavior is one which satisfies the causes for which

behaviour takes place.

4. Related to satisfaction. Motivation is related to satisfaction.

Satisfaction refers to the contentment experiences of an individual whichhe derives out of need fulfillment.

5. Person motivated in totality. A person is motivated in totality and

not in part. Each individual in the organization is a self contained unit

and his needs are interrelated.

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Motivation and Performance

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Motivation

Sense of

competence

Performance Reward

Intrinsic

Extrinsic

Abilities Resources

Role perception



Theories of Motivation

There are a number of different views as to what motivates workers. Themost commonly held views or theories are discussed below and have beendeveloped over the last 100 years or so. Unfortunately these theories donot all reach the same conclusions!

Taylor

Frederick Winslow Taylor (1856 – 1917) put forward the idea that workersare motivated mainly by pay. His Theory of Scientific Management arguedthe following:

Workers do not naturally enjoy work and so need close supervision andcontrol

Therefore managers should break down production into a series of smalltasks

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Workers should then be given appropriate training and tools so they canwork as efficiently as possible on one set task.

Workers are then paid according to the number of items they produce in aset period of time- piece-rate pay.

As a result workers are encouraged to work hard and maximise their productivity.

Taylor’s methods were widely adopted as businesses saw the benefits of increased productivity levels and lower unit costs. The most notablyadvocate was Henry Ford who used them to design the first ever production line, making Ford cars. This was the start of the era of massproduction.

Taylor’s approach has close links with the concept of an autocraticmanagement style (managers take all the decisions and simply give ordersto those below them) and Macgregor’s Theory X approach to workers(workers are viewed as lazy and wish to avoid responsibility).

However workers soon came to dislike Taylor’s approach as they were onlygiven boring, repetitive tasks to carry out and were being treated little better than human machines. Firms could also afford to lay off workers asproductivity levels increased. This led to an increase in strikes and other

forms of industrial action by dis-satisfied workers.

Mayo

Elton Mayo (1880 – 1949) believed that workers are not just concernedwith money but could be better motivated by having their social needs metwhilst at work (something that Taylor ignored). He introduced the HumanRelation School of thought, which focused on managers taking more of aninterest in the workers, treating them as people who have worthwhileopinions and realising that workers enjoy interacting together.

Mayo conducted a series of experiments at the Hawthorne factory of theWestern Electric Company in Chicago

He isolated two groups of women workers and studied the effect on their productivity levels of changing factors such as lighting and workingconditions.

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He expected to see productivity levels decline as lighting or other conditions became progressively worse

What he actually discovered surprised him: whatever the change in lightingor working conditions, the productivity levels of the workers improved or remained the same.

From this Mayo concluded that workers are best motivated by:

Better communication between managers and workers ( Hawthorneworkers were consulted over the experiments and also had the opportunityto give feedback)

Greater manager involvement in employees working lives ( Hawthorneworkers responded to the increased level of attention they were receiving)

Working in groups or teams. ( Hawthorne workers did not previouslyregularly work in teams)

In practice therefore businesses should re-organise production toencourage greater use of team working and introduce personneldepartments to encourage greater manager involvement in looking after employees’ interests. His theory most closely fits in with a paternalistic styleof management.

Maslow

Abraham Maslow (1908 – 1970) along with Frederick Herzberg (1923-)introduced the Neo-Human Relations School in the 1950’s, which focusedon the psychological needs of employees. Maslow put forward a theory thatthere are five levels of human needs which employees need to havefulfilled at work.

All of the needs are structured into a hierarchy (see below) and only once a

lower level of need has been fully met, would a worker be motivated by theopportunity of having the next need up in the hierarchy satisfied. For example a person who is dying of hunger will be motivated to achieve abasic wage in order to buy food before worrying about having a secure jobcontract or the respect of others.

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A business should therefore offer different incentives to workers in order tohelp them fulfill each need in turn and progress up the hierarchy (seebelow). Managers should also recognise that workers are not all motivatedin the same way and do not all move up the hierarchy at the same pace.They may therefore have to offer a slightly different set of incentives fromworker to worker.

Herzberg

Frederick Herzberg (1923-) had close links with Maslow and believed in atwo-factor theory of motivation. He argued that there were certain factorsthat a business could introduce that would directly motivate employees towork harder (Motivators). However there were also factors that would de-motivate an employee if not present but would not in themselves actuallymotivate employees to work harder (Hygienefactors)

Motivators are more concerned with the actual job itself. For instance howinteresting the work is and how much opportunity it gives for extraresponsibility, recognition and promotion. Hygiene factors are factors which‘surround the job’ rather than the job itself. For example a worker will onlyturn up to work if a business has provided a reasonable level of pay andsafe working conditions but these factors will not make him work harder athis job once he is there. Importantly Herzberg viewed pay as a hygiene

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factor which is in direct contrast to Taylor who viewed pay, and piece-ratein particular

Herzberg believed that businesses should motivate employees by adoptinga democratic approach to management and by improving the nature andcontent of the actual job through certain methods. Some of the methodsmanagers could use to achieve this are:

Job enlargement – workers being given a greater variety of tasks toperform (not necessarily more challenging) which should make the workmore interesting.

Job enrichment - involves workers being given a wider range of morecomplex, interesting and challenging tasks surrounding a complete unit of

work. This should give a greater sense of achievement.

Empowerment means delegating more power to employees to make their own decisions over areas of their working life.

RESEARCH

METHODOLOGY

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RESEARCH METHODOLOGY

Research in common practice refers to search for knowledge. One can

also define research as a scientific and systematic search for pertinent

information on a specific topic. In fact, research is an art of scientific

investigation. Some people consider it as a movement from the known to

unknown. It is actually a voyage of discovery. We all possess the vital

instinct of inquisitiveness for, when the unknown confronts us probe and

attain full and fuller understanding of the unknown. This inquisitiveness is

the mother of all knowledge of whatever the unknown, can be termed as

research.

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Research Design:

Definition: "A research design is the arrangement of condition for

collection and analysis of data in a manner that to combine relevance

to research purpose with economy in procedure".

Research design is a conceptual structure within which research is

conducted. It constitutes the blueprint for the collection, measurement and

analysis of data. Research design is needed because it facilitates the

smooth sailing of the various research operations, thereby making

research as efficient as possible yielding maximum information with

minimum effort, time and money. Research design stands for advance

planning of methods to be used for collecting the relevant data and the

techniques to be used in their analyses. Preparation of research design

should be done with great care as any error may upset the entire project.

Therefore it is imperative that an efficient design must be prepared before

starting research operations. The design helps the researcher to organizehis ideas in a form whereby it will be possible for him to look for flaws and

inadequacies.

The following questions have to be answered in a research design:

What is the study about?

Why is the study being made?

Where will the study be carried out?

What type of data is required?

Where can the required data be found?

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What periods of time will the study include?

What will be the sample design?

What techniques of data collection will be used?

How will the data be analyzed?

RESEARCH PROCESS

o Formulating research

o Extensive literature

o Developing hypothesis

o Preparing research design

o Data mining sample

o Collecting the data

o Execution of project

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o Analysis of data

o Hypothesis testing

o Generalization & interpretation

o Report writing.

Research objective

Primary Objectives:

To study the effectiveness of Monetary Incentives.

To study employees behaviour.

To measure the satisfaction level of employees regarding different

aspects of work.

Identify the most motivating factor in the organization.

Secondary Objective:

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Impact of motivational programs on employees.

Identify the effective motivational tools so as to increase the

productivity of an employee.

To find out the areas of improvement for the company.

To examine the reasons for Employee Turnover.

The objective of research was to Enhance Productivity through

Monetary Motivational Tools.

Research Procedure

Data Sources

Information has been gathered through primary and secondary sources.• Primary Data

It consists of original information gathered for the specific purpose. This

data is generally collected by observation and survey method.

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• Secondary Data

It consists of information that already exists somewhere having been

collected for another purpose. They offer the advantage of low cost and

ready availability.

Sources of Secondary Data

Various Magazines (Business India, Advertising & Marketing)

Newspapers, Industry Trade Association Manual.

Annual Report of ITC ltd.

Data Collection

Primary data was collected by performing personal interviews and

observation. Secondary data was collected mainly from the Company’s

web site and annual report.

Research Instrument

To collect the primary data the most common research instrument used

was Questionnaire. A questionnaire consists of a set of questions

presented to respondents for their answers.

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Sampling Plan

This calls for three decisions :

1. Sample Units : Who is to be surveyed ?

2. Sample Size : How many are to be surveyed ?

3. Sample Procedure : How they are to be surveyed ?

Sample Size:

All employees working in the COT division of ITC Ltd.

Sample Extent:

All the Employees were a part of COT – Central Operating Team which

coordinated between all the divisions of the organization.

Interview was conducted by adopting random sampling procedure.

Questionnaire

Q1. What is your age?

Q2.How long you have been working in this organization?

Q3. Are you satisfied with the working conditions?

Q4. What do you prefer financial incentives or non-financial?

Q5. Are you satisfied with the financial incentives company is providing?

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Q6. Is there any specific type of financial Incentive Company is giving to

you?

Findings

Mostly Employees are satisfied with the policies provided by

Company.

Financial incentives given by the company greatly influences the

working of the employees.

Most of the employees prefer financial incentives.

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Employees are happy with performance based incentives

Due to continuous entrance of new employees in the Company,

competition is intensifying.

Conclusion

It focuses on the integrated effort in development of performance culture

and increasing motivation of the employees. Motivational tools are pivotal

mechanism of good performance management. Positive motivation is the

definite guide for today’s competitive businesses enterprise.

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It is yardstick that would help in improving the contribution of an employee

in the organization. Improved measurement of human resources plays a

vital role in linking the human resource initiative to business strategies for

significantly increasing the values.

Targets should be challenging as well as achievable goals, which are not

beyond the scope of employees should be selected. Goals, which are mess

with group goals and organizational goals, should be selected. Employees

should be in position to influence the outcomes.

Employees should know what they are expected to achieve and

management should know what they want. System should be flexible

enough to changes standard according to the needs of the company.

Conclusions regarding organization (ITC)

None of the employees are unskilled in the organization.

Motivation is a continuous process.

All employees fully understand the goals of the organization.

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In this organization reward are given to the employees for the

better performance.

Reward in both forms that is cash form and king form are given to the

employees for better performance.

Individuals are fully aware about the rating procedure.

A special company run pension scheme is given to employees.

Recommendation

To study the motivation system in ITC limited, Haridwar. I want to give

some suggestions to make this system aware, effective and better.

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Performance appraisal must be done to motivate the employees.

Motivation must done on regular basis and difference of time

between appraisal should be less.

Motivational tools must be regularly amended and updated.

The help of experts should be taken while examining the motivation

level of the employees in the company.

Give appropriate rewards, which inspire them to give better

performance. Like promotion, monetary and non-monetary incentives.

At this time of recession monetary incentives plays a crucial role.

In order to avoid critical situation and to develop team spirit, to

motivate employees, feedback is necessary tool.

Giving and receiving feedback is a skill, so a proper system should be

adopted for the same.

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