Bonuses and Motivation PDF Print E-mail
Written by Glenn Felix   
Tuesday, 22 June 2010 07:55

Bonuses and Motivation

by Glenn Felix

Many companies have some sort of safety bonus plan, a reward system that recognizes and rewards safe work practices and accident-free outcomes.  This might be Safety Bingo, Safety Bucks, safety suggestion drawings, cash for incident-free months, free lunches for safe work periods, or some such.  More ambitiously, companies might have a Pay-for-Performance plan that rewards improvements in labor efficiency, recovery, utility usage, materials waste, or other improved operational outcomes.  (An upcoming article series will discuss this direction further).

Behind any successful incentive program though lays the concept of Motivation.  It is helpful to have a comfortable understanding of this arena if we are to maximize the effectiveness of any incentive plan we have now, or that we might put in place sometime in the future.  

Motivation and De-motivation
The psychologist, Frederick Herzberg described motivation best.  His motivation-hygiene theory (now decades old) remains far and away the most practical explanation of motivation in the work setting (at least to this writer). *

The gist of Herzberg's theory is that factors intrinsic to the job can motivate, and factors extrinsic cannot.  

Intrinsic factors are an ongoing part of the job itself, and consist of things like:

  • Responsibility
  • Sense of achievement
  • Interesting work
  • Recognition for good performance
  • Potential for personal growth

Extrinsic factors are not an inherent part of the job itself — are not always present — and are therefore incapable of motivating performance.  These are things like:

  • Company policies    
  • Administrative procedures
  • Manager and supervisor skills
  • Interpersonal relationships
  • Working conditions
  • Job security
  • Job titles and status
  • Wages and benefits

According to Herzberg, dissatisfaction can occur if these extrinsic (he calls them hygiene) factors are not met — and that is a core insight into understanding worker behavior.  But meeting these more basic needs does not automatically result in a motivated employee.

The fact that wages and benefits are not motivators might seem to fly in the face of common sense.  Most of us work because we get paid for doing so.  If we didn't get paid, we wouldn't work.  But when we understand just what motivation is, the role of money makes better sense.

What is Motivation?

Motivation is defined by Herzberg as "The desire to accomplish something without regard to outside stimulation."  

Pushing for performance with overt or implied threats, or pulling for performance with rewards (or the promise of rewards) does not instill motivation.  Only the pusher or puller is motivated.  Just because the respondent moves in desired directions does not mean that he or she is motivated to do so.  

"It is only when he (or she) has his own generator that we can talk about motivation.  He then needs no outside stimulation.  He wants to do it."

As for wages and benefits, Herzberg argues effectively that if people are underpaid, and perceive that inequity, they will be dissatisfied, and hence less motivated.  Restoring salaries or wages to a fair level can remove the demotivator, but raising compensation above this level will not automatically incite greater performance.  

So if wages and benefits don't motivate, why have safety or other bonuses?

Why Safety Bonuses Work

Safety (and other) bonuses work, not because people get money for being safe.  The bonuses work because a lot of other good things are happening at the same time.

  • Awareness — Safety Bonus Programs begin by declaring safety as something very important — important enough for the company to spend more time and money on it.

  • Direction — Next, employees are educated about things like "reportable incidents" and "lost time accidents," things that define safety-performance goals.  Typically, no incidents or lost time is rewarded, thereby giving employees direction as to safety expectations.

  • Feedback — With safety expectations defined, employees are regularly updated about how they're doing — often daily.  This feedback about incidents, unsafe practices, and lost time, is an important communication — a formal message to employees that reminds them about the importance of safety.

  • Recognition — As safety goals are realized, bonuses are paid out, ideally face to face and by separate check if money is involved.  (Or in safety bucks). Bonus checks complete the feedback loop, recognizing the better-than-before performance of employees, and tangibly thanking them for doing a good job.


Safety bonus programs have other benefits.  

  • They keep safety in the spotlight.  Maintaining information about progress toward safety goals, and communicating results to supervisors and employees makes everybody more attentive.  
  • Safety committees have added responsibilities to help publicize and maintain the program.  More responsibility adds meaning and stature to the roles of committee members.
  • Managers, supervisors, and employees talk more about safety.  
  • Unsafe conditions and behaviors are nearly always recognized and corrected more rigorously when a bonus of sorts is involved.

* Herzberg, Frederick, "One More Time; How Do You Motivate Employees", Harvard Business Review (January-February 1968) the number one most requested article in the history of the Harvard Business Review.  (Reprinted in HBR’s 65th Anniversary issue, September-October, 1987), and at other times.  Available online.  Other motivationalists do speak to the same principles.

See also — Herzberg, Frederick, "The Motivation to Work," John Wiley, N.Y. (1959).


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