FINANCIAL MOTIVATION AND PRODUCTIVITY IN SELECTED SOFT DRINK INDUSTRIES IN ENUGU NIGERIA

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FINANCIAL MOTIVATION AND PRODUCTIVITY IN SELECTED SOFT DRINK INDUSTRIES IN ENUGU NIGERIA

ABSTRACT

This research set out to analyze the needs and preference of Nigerian employees with a view to determining how they can be effectively motivated to perform optimally at work for the overall benefit of their organizations and themselves. Various motivation theories including Abraham Maslow’s Hierarchy of needs, Hertzberg’s Hygiene theory and Alderfer’s famous ERG theory of motivation were reviewed. The population of the study comprised of the entire staff of the Nigerian Bottling Company, 7up Bottling Company, mainly in Enugu. Questionnaires were administered and the data analyzed using simple percentage, while the chi-square statistic was used to test the formulated hypotheses. The questionnaires dealt with the motivational impact of salaries, fringe benefits, regular promotion, status enhancement and job security among others. Remuneration was discovered to be a key motivator irrespective of staff status within the organization. The study revealed that an average Nigerian employee would be motivated by prospects of promotion and motivated the more if promoted. Constant elevation at work based on merit, backed up with financial rewards remains a valued preference of the workers. Stagnation on a particular rank is abhorred by the employees. It is recommended that further research should be conducted in the other locations where soft drink industry is established in Nigeria.

TABLE OF CONTENTS

Title page – – – – – – – – – i

Certification – – – – – – – – ii

Dedication – – – – – – – – – iii

Acknowledgement – – – – – – – iv

Abstract – – – – – – – – – v

Table of Contents – – – – – – – vi

CHAPTER ONE: INTRODUCTION

1.1 Background to the study – – – – – 1

1.2 Statement of the Problem – – – – – 4

1.3 Objectives of the study – – – – – – 4

1.4 Relevant Research Questions – – – – 5

1.5 Research hypotheses – – – – – – 5

1.6 Scope of study – – – – – – – 6

1.7 Significance of the study – – – – – 6

1.8 Definition of terms – – – – – – 8

References – – – – – – – – 9

CHAPTER TWO: REVIEW OF RELATED LITERATURE

2.1 Introduction – – – – – – – 10

2.2 Maslow’s need hierarchy – – – – – 12

2.3 Hertzberg’s two factor theory – – – – 15

2.4 McGregor’s X and Y theory – – – – – 17

2.5 Motivation and Productivity – – – – – 18

2.6 Productivity – – – – – – – 20

2.7 Overview of the Nigerian soft drink industries – – 21

2.8 Strategies currently adopted to motivate employee in the industry – – – – – – 23

References – – – – – – – – 32

CHAPTER THREE: METHODOLOGY

3.1 Research design – – – – – – – 33

3.2 Sources of Data – – – – – – – 33

3.3 Population and sample size determination – – 33

3.4 Description of research – – – – – – 34

3.5 Method of investigation – – – – – – 35

3.6 Research instrument, validity and reliability – – 35

3.7 Method of data analysis – – – – – 35

References – – – – – – – – 37

CHAPTER FOUR: DATA PRESENTATION, INTERPRETATION AND ANALYSIS

4.1 Distribution and return of questionnaires – – – 38

4.2 Analysis of data/test of hypothesis – – – – 38

CHAPTER FIVE: SUMMARY OF FINDINGS, RECOMMENDATIONS AND CONCLUSION

5.1 Summary of findings – – – – – – 54

5.2 Recommendations – – – – – – 55

5.3 Conclusion – – – – – – – – 56

5.4 Suggestion for further research – – – – 57

Bibliography – – – – – – – 58

Appendix – – – – – – – – 60

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The survival of any organization in a period of plenty, scarcity and turbulence depends on multifarious factors of which employee motivation is paramount (Muo, 1999:16).

An organization can be seen as an entity and also a process of co-ordinating individual effort to accomplish a common objective. It is a group of people bound together to provide unity of action for one achievement of a predetermined objective. According to Koontz (1988:40), to form an organization and make it accomplish its goal, two broad components have to interact for goal accomplishment. Of this two elements, human is no doubt the most important, most difficult to handle and most special. Employees represent the life-wire of the organization, which mobilize the life-less material components that would have other wise been inert or hidden.

Human beings are complex, rational and unpredictable and hence deserve special attention while materials are inanimate. Humans are characteristically unique, they posse’s personal aspirations and goals which most times are antithetical with those of the organization he works. The various complexities that could be either socio-biological or emotional tend to transform human being into attitudes and behaviours that are generally cumbersome erratic and unpredictable. These elements turn human being difficult to manage. Man is however, considered as an organizations greatest assets because with out him virtually nothing can take place. His importance ranges right from factory setting up to the top management level where actual strategic planning, organizing, directing and co-ordinating really takes place. The manager in an organization has to create in a man the appropriate state of mind, emotional stability and positive work attitude required for and favourable to the accomplishment of organizational goals. He must strive to adequately motivate the staff to elicit positive work attitude and perform it in compliance with pre-established standards of the organization. To do this, he must recognize the need and importance of effective motivation. It is only by so doing that productivity coupled with financial benefits will be enhanced and returns on investment worth while. This research examines the nature of the Nigeria employee with special interest in the staff of Nigerian soft drink industry in Enugu. It tries to examine how and with what they can be effectively motivated to work optimally in the industry.

According to Muo (1999:26), modern behaviour scientists are currently investigating a myriad of organizational problems ranging from the impact of equity on motivation to ways of enriching low-level assemblies of line work. The quest to determine and investigate the reasons behind various work attitudes such as increased labour turnover has made a lot of researchers delve into its related impact on productivity. Motivation has been severally and variously defined:

Swift (1981:30), views motivation as a drive to perform. It involves the effort, willingness persistence and a person’s desires to perform. The effect of motivation in any organization causes employees to be with or generally satisfied or dissatisfied with their jobs. He went ahead to define motivation as a label for determining choice to initiate effort, the choice to expand certain amount of effort and the choice to persist in expanding efforts over a period of time to achieve a given performance objective.

In a broader form (Muo, 1999:30) was of the view that fringe benefit must have an objective in an organization whether legally imposed by state or federal legislation or included in the contract of employment or constituted by management wish.

He write that one of the major problems confronting management is that of motivating workers to perform tasks to meet or surpass predetermine standards. He also said that motivation could be seen as an energizing force that induces or compels and maintain behaviour.

Swift (1981:63) opines that it is not easy to motivate an individual and that the success of any motivational efforts depends on the need of the individual employee for whom it is intended.

Motivation is an internal psychological process whose presence or absence is inferred from observed performance (Nwachukwu 1988:18). He says that a motivated behaviour is characterized by sustenance, goal directed and result from felt needs.

1.2 STATEMENT OF PROBLEM

Many organizations have been saddled with too many problems attributed to motivation, financial benefit and productivity especially in soft drink industries. Some of these problems include high employee’s turnover, engagement of employees in order similar organization and confidence between employers and employees problems of ethic and performance problems. These problems stand out when put side by side with general public perception in soft drink industries in general. Therefore, some organizations attach privatization and productivity to prestige and status in the organizations while other attributes it to employee’s needs, expectation and values.

However, the concern for and problem of how to motivate workers for productivity enhancement in any organization has not level. Though, several measures have been taken since this last two decades, unfortunately not much has been achieved.

1.3 OBJECTIVES OF THE STUDY

The objectives of this study are as follows:

To investigate the impact of financial motivation on employee productivity based on staff perception in 7up Bottling Company and the Nigerian Bottling Company.

To find out how increase in salary fringe benefit and other financial benefits could make employees happier with their jobs and hence make them perform better.

To study strategies which will assist the employers in motivating employees

To study how non-financial benefits such as praise, letter of commendation, off duties for work well done motivate employees

How job enrichment motivate workers.

1.4 RELEVANT RESEARCH QUESTIONS

Our research questions include:

Do the increase in salary and fringe benefits motivate employee?

How do the regular promotion, status enhancement, job security and financial incentives motivate workers?

How do employees rate, various needs and financial benefits derived from it?

1.5 HYPOTHESES

Our hypotheses for this study are as follows:

H01 Increase in salary and/or fringe benefits will not make workers feel happy at work and also enhance their confidence in the organization.

H02 Enhancement of status and prestige that go along with promotion are not important than its financial attachments (gains).

H03 Regular promotion or bright chances of promotion could not boost morale and make for better performance in the service of an organization.

H04 Job security is not enough to win staff commitment in organizations.

1.6 SCOPE OF STUDY

This research focuses on the Nigeria Bottling Company and 7up Bottling Company located in Enugu, both of which fairly represent the Nigeria soft drink industries. It further tries to provide a solution to basic problems by testing some of the prepositions of Nigerian situation. The study is limited to the following limitations:

The level of frankness in response to questions by the respondents is quite doubtful.

The official bureaucracy that tends to frustrate free communication flow between the subordinates and their boss.

The study is limited to 7up and the Nigeria Bottling Companies both of which are major actors in the Nigeria soft drink market. The study is limited to Enugu offices of the companies.

1.7 SIGNIFICANCE OF THE STUDY

a. The study will serve as guide to the management of Nigerian soft drink industries in particular and the Nigerian managers as a whole in determining the best way of getting the best output from their employees who are presently demoralized in the face of the prevailing socio-economic hardship.

b. From this research, Herzberg (1968) came up with two-dimensional theory of motivation. According to him, the motivators are achievement, recognition, responsibility, advancement and work itself. Once an employer induces staff with these factors, good result and accomplishment or organizational goals will be achieved. Financial benefit will also follow and the individual become happy in the job.

c. Evidence from different empirical studies point to the fact, there is no single motivator for every one. Needs differ and the importance attached to needs by different people also differs. In order to motivate a person to put in the best effort in his work, the following factors have been identified:

1. wages/salaries

2. job security

3. promotion

4. job enrichment

5. Increased responsibility

d. According to Maslow, man always has needs to satisfy. This need can be classified in a hierarchical order starting from the basic needs to the higher order needs. Once a particular need is satisfied, it ceases to be a motivator and another need emerges. Therefore reward for hard work is very essential.

1.8 DEFINITION OF TERMS

Motivation: Motivation would be seen as that energizing force consciously applied through skillful appeal to employees basic needs to compel positive work attitude to achieve organizational goal.

Employees: Employees would refer generally to members of staff of an organization, both management and non-management and would be used interchangeably with workers.

Work Attitude: This would refer to employee’s state of mind as expressed in concrete action behaviour or their manner of performing their duties.

Promotion: Elevation of an employee to a better job, better in terms of greater responsibilities, enhanced authority more prestige or status greater skill increased remuneration and fringe benefits.

Employees Needs: This refers to basic wants of employees, the desire to satisfy which activates their energy to satisfy and the fulfillment of which engenders positive work attitudes. In the study these needs are categorized into three: Existence, Relatedness and growth needs.

Productivity: Productivity involves goal attainment. It is the successful transfer of input to output at the lowest possible cost. Productivity implies both efficiency and effectiveness.

REFERENCES

Nwachukwu, C.C. (1988) Management Theory and Practice, Onitsha: African FEP Publishers Ltd.

Muo, I.K. (1999) The Nature, Scope and Challenges of Management, Lagos: Impressed Publishers

Swift, N. (1981) Motivational Techniques, Houston: Modonnel Publishing Press.

CHAPTER TWO

REVIEW OF RELATED LITERATURE

2.1 INTRODUCTION

In considering the issue of industrial growth and improved product output in any organization one of the most important requirement that must be satisfied is the availability of highly motivated and deeply involved people who are selflessly committed to discovering new ways of improving their living conditions. Such were the type of people who gave birth to the industrial revolution in Europe, the communist revolution in China, the gigantic scientific and technological advancement in the United States, Russia and the spectacular Japanese accomplishment in electronics and technology (Porter 1961:20).

In these societies, the motivation to realize these accomplishments started both at the national and individual levels and continuous optimum performance is sustained by psychological satisfaction derived from experienced success.

Thus, performance or behaviour is a function of the motivational level, the degree of involvement and the amount of satisfaction derived from performing a task (Porter, 1961: 45, 1 – 10). The dynamics of motivation, satisfaction and involvement in the organization have been critically studied by eminent scholars, psychologists and management gurys like Maslow (1943), Agysis (1964), McGregor (1960), Herzberg, Mauzner and Synderman Mceclelland (1961), Vroom (1964), Lawler and Porter (1967), etc. The assertion of the above scholars serve as stimulant for future investigation the result of which will add immensely to knowledge.

A manager whose job involves the creation and maintenance of an environment in which individuals work together in group towards the accomplishment of common objectives must study what motivates people.

Koontz (1988:411), stated that human motives are based on needs such as the physiological requirement for water, air, food, sleep and shelter, other needs may be regarded as secondary such as self esteem, status, affliction with others, affection giving, accomplishment and self assertion.

In other words, motivation related to the entire drives, needs, wishes and similar forces capable of engineering a person or group of persons to perform optimally at work place. These identified rewards on incentives that sharpen the drive to satisfy these wants are referred to as motivators.

A manager can do much to sharpen motives by establishing an environment favourable to certain drives. For example people in a business that has developed reputation over years like Shell Petroleum Company or Mobile Company in Nigeria tend to be motivated to contribute to this reputation.

Lawler and Porter (1967:50) relate motivation in terms of needs expected, reward, goal directed performance, obtained reward and satisfaction.

Figure 1: The Motivational Cycle

Source: Koontz, 1988:411

Over the years, psychologists have developed theories and models to explain how the concept of motivation operates in human societies. These theories shall be briefly viewed from the perspectives of the few selected proponents.a

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