Incentive Schemes in India

Schemes of incentive payment introduced in India in the year 1946. Since then incentives are popular in our
country. But their format differs from industry to industry and plant to plant. There is no one scheme followed
throughout the country. The schemes introduced by ILO are followed partially.
It is difficult to follow the incentive plans as prescribed by ILO because measurement of performance is
extremely difficult. Some companies are awarding incentives on the basis of performance to group and not individuals.
In industries like iron and steel and chemical are also paying incentives. Production bonus is also quite popular in our
country. The norms for payment are fixed on job analysis and or time and motion studies.
The incentive schemes operate on group or individual basis depending upon measurability of group or an
individual worker and inter dependence of their output performance. The group incentive plans are most popular in
Indian industries than individual incentive plans.
Features of Incentive Schemes:
Below are some of the features of incentive schemes in India:
(1) The incentive scheme is introduced in India in the year 1946 but the scheme is still in underdeveloped stage.
(2) There is no uniformity of incentive schemes. Every plant, company and establishments have adopted different
schemes which they think is better or convenient. Moreover these schemes are not based on motion and time
studies, job analysis or consultation with unions.
(3) While adopting incentive schemes undertakings as far as possible do not follow any guidelines.
(4) Payment of incentives failed to motivate workers for better performance because the present of inflation robs off
the joy of getting additional payment. Incentives are therefore need to be substantiated.
(5) Every aspect of incentives in not negative in our country. In many establishments and undertakings objective of
increased productivity is attained.
(6) In cases where group incentive schemes are in vogue, a system fails to operate effectively because of no direct
link between efforts and earnings.
Non – Monetary Incentives:
Monetary incentive serves the purpose as motivator but there are several non monetary factors also catches the
attention and they work wonders. The non financial incentives are the open sandwiches of desirable things that are
potentially at the disposal of the undertakings. The creation of these rewards depends upon executive’s ingenuity
and skill to assess payoffs. Here it should be remembered that what one likes another dislikes. Executive’s skill lies
in assessing and finding out who likes.
(1) An employee having strong need for affiliation may accept job assignment which he feels socially attractive and
satisfying.
(2) Some factors that are considered as status symbol motivate the person, e.g. :- sophisticated furniture’s, wall
paintings, personal assistant, respectable job title, visiting cards, name plate etc.
(3) Those who have lust for power can respond to accepting administrative responsibility and produce positive
results.
(4) Praising an employee’s work in front of his colleagues and group may motivate him to better work. These
gestures motivate others also.
(5) If employees past experience in recognized by inviting him to participate in some complex assignment, he feels
delighted and gives his hundred percent potential.
(6) In recognition of seniority of the employee more responsibility can be given.
(7) Award for best safety performer can motivate the employee towards excellent work.
(8) Non-monetary incentives work for same persons with human feelings. These incentives do not work for
miscreants and rogues.