1.1 Introduction
Organizational bonus scheme is an additional pay, an incentive package designed to induce or motivate employees towards high productivity. It is a vital instrument in employee performance. A well rewarded employee feels that he/she is being valued by the company that he/she is working for. They are also encouraged to work harder and better if they are aware that their well-being is taken seriously by their employers, and that their career and self development are also being honed and taken care of by their company. Employees are the engine of organization vehicles while reward is the fuel. In the modern time management, no organization can achieve its stated objectives without commiserate rewards and fringe benefits for its employees (Martocchio, 2011).
As a prelude to other parts of this study, this chapter will discuss the background upon which this study was initiated, the statement of problems that led to this study, the Aim and Objectives of the study. Others are Significance of the study, Scope of work, Research hypothesis and questions, Limitations of the Study and Definition of technical terms.
1.2 Background of Study
The impact of bonus scheme on employees' productivity should not be overlooked. Obviously the various forms of behaviors and attitudinal dispositions required of an organizations from its employees to achieve some goals depend greatly on the kind and methods of inducements, motivational tools, incentives on bonus systems that exists in such as methods or patterns of administering incentives or bonus in an organizations whereas bonus itself is an incentive package of monetary value designed for employees to ginger their mind and induce them towards greater work performance.
Ifurueze S. Meshack (2008:89) suggests that bonus scheme varies from one organization to another depending on their policies. He identify S. methods of applying bonus (scheme) in organizations which includes:
- Halsey bonus scheme
- Halsey weir bonus scheme
- Rowan bonus scheme
- Priest-man's bonus scheme
- Group incentive bonus scheme
The adoption or non application of bonus scheme in an organizations would have positive and a negative influence on employees work performance, therefore it has the tendency of increasing or reducing productivity rate.
Most organizational bonus scheme has ceased to be a motivating factor to most employees due to the static and unimproved nature, when a particular bonus scheme is in use over a long period of time in an organizations without changes, it ceases to be a job motivator to employees because they will begin to look forward to another higher incentive that could ginger their mind and induced, sustain them towards putting more efforts to work, have positive attitude in the course of discharging their duties so as to achieve efficiency.
Therefore, in Nigeria where the research was carried out, the activities that was conducted is to ascertain the Impact of Organizational Bonus Scheme on Employees’ Productivity.
1.3 Statement of Problems
Investigation revealed that despite the availability of human resource management in these banks, observation has shown that there are still certain problems that lingers which could be traced as employee poor performance (inefficiency), which is as a result of men or inadequate bonus incentive packages existing in these banks. It is believed that good bonus scheme could motivate, sustain employees' interest and improve their performance.
The banks selected for the study (Union Bank Nig. Plc & Fidelity Bank Plc Owerri) like every other firms have a stated target to achieve, and for them to accomplish these objectives, workers must be employed.
1.4 Aim and Objectives of Study
The aim of the study is to ascertain the Impact of Organizational Bonus Scheme on Employees’ Productivity using Union Bank and Fidelity Bank Plc. Owerri, Imo State as a case study. In achieving this aim, the following specific objectives were laid out as follows:
- To find out the various bonus schemes that exists in these banks of study.
- To identify the roles bonus scheme play on employee's productivity.
- To evaluate various employees performance and know which bonus scheme has encouraged higher productivity so as to adopt it.
- To come up with conclusion whether the bonus scheme can be used to motivate workers or not, to achieve high productivity.
1.5 Research Questions
The study came up with research questions so as to be able to ascertain the above stated objectives. The specific research questions for the study are stated below as follows:
- Is employees' poor performance traceable to the kind of bonus scheme present in these organizations?
- Are there some needs which the existing bonus system has failed to address in these organizations?
- How does the bonus scheme of these organizations affect their job performance?
- How effective are bonus schemes as motivational techniques?
- What is the impact of organizational bonus scheme on employees’ productivity in the banking sector?
- What are the various methods of bonus schemes applied to motivate employees in these banks?
1.6 Research Hypothesis
In order to pursue the objective of this study, the following generalized statements have been designed to guide and aids in obtaining the result for the experiment to be conducted. For this work, the null hypothesis will be represented with H0 while the alternative hypothesis will be represented with hypothesis H1.
Hypotheses One
- H0: There is no significant relationship between organizational bonus scheme and high productivity within banking industries.
- H1: There is a significant relationship between organizational bonus scheme and high productivity within industries.
Hypotheses Two
- H0: Bonus scheme is not effective in changing the nature of organizational operation.
- H1: Bonus schemes are effective in changing the nature of organizational operations.
1.7 Significance of Study
This study will be beneficial to:
- The researcher, in the sense that it will enable him to know the impact OF bonus schemes and its outcomes in an organization.
- This study will also become a part of reference to other researchers, so the public and other scholars will also benefit from it.
- The study will also be of benefit to my banks of study and to entire banking sectors because the outcome of this work will help them in formulating organizational policies that take cognizance of the impact of bonus scheme.
1.8 Scope of Study
The scope of the research is focused on the Impact of Organizational Bonus Scheme on Employees’ Productivity. The impact of organizational bonus scheme is and extensive topic whose study is all embracing and required carefulness, therefore the researcher has decided to restrict the study to two selected banks in Owerri (Union Bank Plc & Fidelity Bank Plc).
1.9 Limitations of the Study
During the course of this study, many things militated against its completion, some of which are:
- Time Constraint: The time frame given to accomplish this project was very short due to school academic calendar and it was carried out under pressure which made the researcher not to implement some necessary features.
- Research material: availability of research material is a major setback to the scope of the study.
- Frequent power failure: This made the researcher append more money on fuel to ensure sustainable power.
- Financial Constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
1.10 Definition of Terms
Bonus: This is an additional pay, an incentive package designed to induce or motivate employees towards high productivity.
Incentives: This is anything that is capable of encouraging somebody to do something more and perfectly.
Productivity: This means efficiency which is measured by comparing the amount (quality) produced with the time consumed and the resources used.
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