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REMUNERATION AS A MEANS OF PUBLIC SERVANTS MOTIVATION FOR PRODUCTIVITY

CHAPTER ONE

INTRODUCTION

1.1     BACKGROUND OF THE STUDY

Human resource management is based on the mutual satisfaction. On the one side the employees have to achieve the company’s objectives in an efficient and productive way, and on the other side the employees expect a compensation for their work in mind of wages, benefits, promotion, and so on. On this point motivation comes into focus. Motivation is the inner drive that influences a person’s behavior toward goal achievement. Public organizations most times fulfill their goals through employees, so it is crucial to have efficient and productive staff.

Motivated employees contribute to the long-term success of the organization trough creativity, innovation, and their orientation towards costumers, which is of utmost importance in the public sector. The most influential productivity factor is job performance, and it is a function of four variables (Mitchell, 1982, pp.82-83): ability, understanding of the task, environment, and motivation.

In his article Behn (1995) forced management scholars to focus their research on motivation, as one of the most important questions of public management.

As many authors have recognized the importance of motivation, a big number of theories and approaches were developed.

In the beginning most of the literature referred to the private sector. The topic of motivation of public sector employees has become popular since the work of Perry and Wise (1990) and Behn (1995).

Today, the global financial crisis forces governments and public sector organizations to motivate employees in order to become more productive, and to help to overcome the problems caused by the crisis. According to Perry and Porter (1982) productivity seeks to get “more for less”. Motivation and productivity are in a positive correlation.

They impact each other. So, when motivation in an organization increases, the expectation is that productivity increases too. One of the most popular tools for enhancing motivation and productivity are performance-related pay systems (hereinafter: PRP). PRP systems use monetary tools like bonuses and rewards to motivate employees. Although it is a wide-spread tool, according to OECD (1993 and 1997) PRP systems did not meet the expectations in terms of employee motivation, and performance and pay relation.

The motivation of employees in the public sector differs from the private sector motivation. The approach of Public Service Motivation (hereinafter: PSM) describes features through which the employees can be especially motivated, and that are concentrated mainly in the public sector. Some of them are (Schweizerischer Nationalfonds, n.d.): the possibility to participate in political processes and have a certain impact, the opportunity to commit for the public interest or to promote it, the opportunity to commit and help the society and particular persons.

According to Jurkiewicz, Massey and Brown (1998) as motivation factors of public sector employees are considered job security and stability, while for private sector employees a high salary is the number one motivation factor. Because there are differences regarding sectors, a large number of motivation theories were developed.

1.2            STATEMENT OF THE PROBLEM

Crucial to the success of an organization is competence of the management and workforce, employees’ productivity on the other hand, had been hinged on the employee’s capability and motivation received amongst other factors, to perform the various tasks assigned to the employee. The importance of understanding motivation has been reflected in its relationship with productivity. From the management’s point of view, the motivation level of subordinates is a reflection of the potential human energy available for production. The unleashing and directing of that energy requires the management to activate the energy source of applying stimuli (incentives) (Richard, 1991). The intensity of stimulation required is inversely related to the motivation level. Therefore, motivation and productivity are directly related; the higher the motivation level, the higher the productivity potential of subordinates.

A worker can be extremely satisfied with his/her job and at the same time be unmotivated to exert effort. In fact, that is exactly one of the problems the public sector experiences – some employees are very pleased with their comfort work conditions, e.g. job security, and still have very little motivation to work. Nonetheless, job satisfaction should not be mislaid. It may not have a direct effect on motivation, performance, and productivity, but it sure has been found to be related to employee retention, thus indirectly influencing organizational costs associated with employee absenteeism and turnover (Wright/Davis, 2003, p.71).

Public servants must be effectively motivated through remuneration for efficient productivity.

1.3     RESEARCH QUESTION

1.     What is the impact of motivation on the job performance of public servants

2.     What is the perception of the motivation schemes desired by employees?

3.     What are the recommendations to public sector managers regarding the most influential motivation factors and tools?

1.4       AIMS AND OBJECTIVE OF STUDY

The aim of this studies is to critically study remuneration as a means of public servants motivation for productivity. The objectives are:

1.     To find out the impact of motivation on job performance of public servants

2.     To analyze the perception of the motivation schemes desired by employees.

3.     To give recommendation to public sector managers regarding the most influential motivation factors and tools.

1.5     RESEARCH HYPOTHESES

Ho: there is no significant impact of motivation on the job performance of public servant

H1: there is significant impact of motivation on the job performance of public servant

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