Financial Incentives (which can be calculated in terms of money)
1. Pay and allowances: Salary is the basic monetary incentive. It includes basic pay, dearness allowance and other allowances.
2. Productivity linked wage incentives: Aims at linking payment of wages to increase in productivity.
3. Bonus: An incentive offered over and above the wages/salary.
4. Profit sharing: It means to provide a share to employees in the profits. It creates a feeling of ownership to employees.
5. Co-partnership/Stock option: employees are offered company’s share of a price which is lower than market price.
6. Retirement benefits: Such as provident fund, pension and gratuity etc.
7. Perquisites: Such as car allowance, medical help etc. these measures help to provide motivation to the employees.
Non-Financial Incentives (which cannot be calculated in terms of money)
1. Status: Status means ranking of positions in the organisation. Psychological, social and esteem needs of an individual are satisfied by the status given to their job.
2. Organisational climate: Employees can be motivated with favourable atmosphere.
3. Career advancement opportunity: Works as a tonic and encourages employees to exhibit improved performance.
4. Job enrichment: If jobs are enriched and made interesting, the job itself becomes a source of motivation to the employees.
5. Employees recognition programmes: Most employees feel that what they should be recognised by the higher authorities.
6. Job security: Employees want their job to be secured and it is a strong motivator but on the other hand it makes the employees lazy.
7. Employee participation: It means involving employees in the decision making.
8. Employee empowerment: Means giving more autonomy and powers to subordinates.
