Do financial incentives improve motivation and performance under time constraints?

This study investigates the extent to which financial incentives, or the lack thereof, can influence the motivation and consequently the performance of professionals in an organization. In our paper, variable pay that is contingent on performance and fixed pay which are independent of performance ar...

Full description

Saved in:
Bibliographic Details
Main Authors: Neo, Hui Yi, Yeo, Sui Kim, Chen, Jeff Chang Chang
Other Authors: Low Kin Yew
Format: Final Year Project
Language:English
Published: 2013
Subjects:
Online Access:http://hdl.handle.net/10356/51569
Tags: Add Tag
No Tags, Be the first to tag this record!
Institution: Nanyang Technological University
Language: English
id sg-ntu-dr.10356-51569
record_format dspace
spelling sg-ntu-dr.10356-515692023-05-19T06:24:07Z Do financial incentives improve motivation and performance under time constraints? Neo, Hui Yi Yeo, Sui Kim Chen, Jeff Chang Chang Low Kin Yew Nanyang Business School DRNTU::Business This study investigates the extent to which financial incentives, or the lack thereof, can influence the motivation and consequently the performance of professionals in an organization. In our paper, variable pay that is contingent on performance and fixed pay which are independent of performance are jointly referred to as financial incentives. With intense competition among private companies, professionals are often faced with high time pressure on deliverables. However, they have at their disposals several commonplace resources that can be used to manage time pressure. One such resource is time constraint awareness, which enables the monitoring of time-lapsed and allows the gauging of time remaining before deadlines are due. Another common resource is job autonomy, which allows professionals to control the prioritizing of jobs to complete within a set of deliverables demanding work. Prior researches have established that time pressure is generally related to a decrease in motivation and performance while financial incentives are generally related to an increase in motivation and performance. In our study, we posit that these linear relationships can also interact with common resources, such as controllability over task completion and time awareness that are available in the workplace to mitigate the effect of time pressure on motivation and hence performance. Through a 3 x 2 x 2 x 2 experimental research design involving 455 undergraduates, we show that all four independent variables; payment, awareness, control and time pressure contribute to affect motivation and performance via an interactive manner. Our findings reveal that while under the absence of time pressure, the positive effects of performance-based pay and control are substitutive, their positive effect becomes additive under time pressure. In addition, further analyses reveal that while awareness is associated with a decrease in motivation of participants who are paid independent of performance, this detrimental effect is negated when participants are given performance-based pay. BUSINESS 2013-04-05T06:12:17Z 2013-04-05T06:12:17Z 2013 2013 Final Year Project (FYP) http://hdl.handle.net/10356/51569 en Nanyang Technological University 42 p. application/pdf
institution Nanyang Technological University
building NTU Library
continent Asia
country Singapore
Singapore
content_provider NTU Library
collection DR-NTU
language English
topic DRNTU::Business
spellingShingle DRNTU::Business
Neo, Hui Yi
Yeo, Sui Kim
Chen, Jeff Chang Chang
Do financial incentives improve motivation and performance under time constraints?
description This study investigates the extent to which financial incentives, or the lack thereof, can influence the motivation and consequently the performance of professionals in an organization. In our paper, variable pay that is contingent on performance and fixed pay which are independent of performance are jointly referred to as financial incentives. With intense competition among private companies, professionals are often faced with high time pressure on deliverables. However, they have at their disposals several commonplace resources that can be used to manage time pressure. One such resource is time constraint awareness, which enables the monitoring of time-lapsed and allows the gauging of time remaining before deadlines are due. Another common resource is job autonomy, which allows professionals to control the prioritizing of jobs to complete within a set of deliverables demanding work. Prior researches have established that time pressure is generally related to a decrease in motivation and performance while financial incentives are generally related to an increase in motivation and performance. In our study, we posit that these linear relationships can also interact with common resources, such as controllability over task completion and time awareness that are available in the workplace to mitigate the effect of time pressure on motivation and hence performance. Through a 3 x 2 x 2 x 2 experimental research design involving 455 undergraduates, we show that all four independent variables; payment, awareness, control and time pressure contribute to affect motivation and performance via an interactive manner. Our findings reveal that while under the absence of time pressure, the positive effects of performance-based pay and control are substitutive, their positive effect becomes additive under time pressure. In addition, further analyses reveal that while awareness is associated with a decrease in motivation of participants who are paid independent of performance, this detrimental effect is negated when participants are given performance-based pay.
author2 Low Kin Yew
author_facet Low Kin Yew
Neo, Hui Yi
Yeo, Sui Kim
Chen, Jeff Chang Chang
format Final Year Project
author Neo, Hui Yi
Yeo, Sui Kim
Chen, Jeff Chang Chang
author_sort Neo, Hui Yi
title Do financial incentives improve motivation and performance under time constraints?
title_short Do financial incentives improve motivation and performance under time constraints?
title_full Do financial incentives improve motivation and performance under time constraints?
title_fullStr Do financial incentives improve motivation and performance under time constraints?
title_full_unstemmed Do financial incentives improve motivation and performance under time constraints?
title_sort do financial incentives improve motivation and performance under time constraints?
publishDate 2013
url http://hdl.handle.net/10356/51569
_version_ 1770565490129764352