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Performance-Based Pay as a Motivational Tool for Achieving Organisational Performance: An Exploratory Case Study Francis Boachie-Men

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Performance-Based Pay as a Motivational Tool for Achieving Organisational Performance: An Exploratory Case Study Francis Boachie-Men
www.ccsenet.org/ijbm

International Journal of Business and Management

Vol. 6, No. 12; December 2011

Performance-Based Pay as a Motivational Tool for Achieving
Organisational Performance: An Exploratory Case Study
Francis Boachie-Mensah (Corresponding author)
School of Business, University of Cape Coast
Cape Coast, Ghana
Tel: 233-332-137-870

E-mail: fbmens2002@yahoo.co.uk

Ophelia Delali Dogbe
Mount Zion School, Accra, Ghana
Tel: 233-242-965-648

E-mail: eloloid@yahoo.com

Received: June 3, 2011

Accepted: August 5, 2011

Published: December 1, 2011

doi:10.5539/ijbm.v6n12p270

URL: http://dx.doi.org/10.5539/ijbm.v6n12p270

Abstract

The issue of employees’ performance in furtherance of organisational objectives has occupied management attention for long. Differences in levels of performance have been attributed to differences in skills and abilities on the one hand, and to different theories of money on the other. This study examined the issue of performance-based pay as a motivational tool for achieving organisational performance, using the situation in a manufacturing company in Ghana as a case study. The main objective of the study was to assess the impact of performance-related pay on the motivation of employees and, subsequently, on the achievement of organisational goals. In all, one hundred and fifty respondents took part in the survey. The sample comprised 20 managerial staff and 60 non-managerial staff. The main research instrument was the questionnaire. A two-way
ANOVA table was used to test the main hypotheses. The result of the study revealed that the effect of performance-based pay on employee performance is minimal; and the motivational effect of merit pay is often blunted by biased performance appraisal. The main limitation of the study is that it could not cover all manufacturing companies within the target population, due to time and financial constraints. In this respect, the interpretation of the
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