As competitive pressures intensify, organizations are forced to consider strategies that will help them become more innovative, productive, and efficient. It is essential that organizations maximize all resources to optimize the effectiveness of their operations. While many factors encroach upon this effectiveness, labor is an important resource that often represents a significant portion of expenses incurred by organizations. Considering the need to remain competitive, inventive compensation strategies such as incentive programs are often developed in an attempt to align individual motivation and goals with the objectives of the organization. One method of this is incentive pay, also known as "pay for performance" (Tully, 1995). This is generally given for specific performance results rather than simply for time worked. While incentives are not the answer to all personnel challenges, they can do much to increase worker performance. In comparison with other types of incentives, providing additional moneys for increased performance truly seems to motivate individuals to work harder. It is my belief that money can work in some situations and not others. For example, some employees are truly motivated by money and will do anything necessary to gain more. While others are content with were they are in relation to their jobs and do not desire to advance in any means. They may not want the added responsibilities and increased workload.
This method of thinking could be thought of as a reinforcement theory in which behavior would be shaped by its consequences (Skinner, 1968). A consequence that increases the likelihood of the behaviors being repeated is called a positive reinforcement or reward. In the workp ...