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Intrinsic and Extrinsic compensation

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Write a paper describing in detail how differing organizations would use various blends of extrinsic and intrinsic compensation and benefits strategies to maximize organizational potential and meet the needs of their workforce. The document should examine organizations that effectively utilize extrinsic and intrinsic pay programs to motivate workers and increase organizational productivity.

Select at least five examples of these extrinsic and intrinsic pay programs and explain your reasons for selecting these programs.

Support the document with at least three (3) resources, in addition to the specified resources, other appropriate scholarly resources, including older articles, may be included.

Use current APA standards.

Length: 5-7 pages

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Intrinsic and extrinsic compensation is explained in a structured manner in this response. The answer includes references used.

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Differing organization use various mixes of extrinsic and intrinsic compensation and benefits strategies to maximize organizational potential and satisfy the needs of their workforce. Extrinsic compensation and benefits corresponds the hygiene factors of Herzberg's two factor theory (1). According to Herzberg, hygiene factors are those whose absence can create job dissatisfaction. These include supervision, company policy, working conditions, salary, peer relationship, and security (2). On the other hand according to Herzberg, motivator factors increase job satisfaction. The motivator factors according to Herzberg are achievement, recognition, work itself, responsibility, advancement, and growth (3). To increase the potential of the work force companies must use a mix of motivator factor and hygiene factors. According to Herzberg the motivators put the employees in a frame of mind that made them exert more. In contrast, the hygiene factors prevented the employee from getting into a dissatisfaction frame of mind and leaving the job. The motivator factors are such that are directly related to the job itself. The motivators are connected to the job contents and so are called intrinsic factors. On the other hand the hygiene factors are those factors that are not related to the job itself and are around the job (4). They are n the environment in which the employee works. Intrinsic factors fulfill the employee's motivators. The extrinsic factors are those that fulfill the employees hygiene factors and prevents him from thinking of leaving the company. It is possible for a company to increase intrinsic rewards and not increase extrinsic rewards. However, it would be meaningless to have a highly motivated employee who leaves the company and joins a competitor. Similarly, it is possible to increase the extrinsic factors and not increase intrinsic factors. It would be equally meaningless to have a loyal workforce but the employees are not motivated to work. Those companies that successfully motivate their employees and increase organizational productivity use a mix of motivator factors and hygiene factors. They use a mix of intrinsic and extrinsic factors (5).
We now examine organizations that effectively use extrinsic and intrinsic pay programs to motivate workers and increase organizational productivity:
The first example is that of Google. Google has been selected because it offers an ...

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  • BSc , University of Calcutta
  • MBA, Eastern Institute for Integrated Learning in Management
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