For an enterprise, the scientific incentive system has at least the following functions:
1. Attract excellent talents to the enterprise.
In many enterprises in developed countries, especially those competitive, the strength of the enterprise, through a variety of preferential policies, generous welfare benefits, rapid promotion way to attract enterprises need talent.
2. Develop employees' potential abilities and promote their talents and wisdom.
Harvard University professor William James (w. James) found in the study of employee motivation, the hourly wage distribution system only can let the employees play the ability of 20% ~ 30%, if received sufficient incentive, employee's ability to perform 80% ~ 90%, 60% of the gap between two situations are the result of the effective incentive. Management studies have shown that employees' performance is a function of their ability and motivation, that is, performance =F (ability * motivation). If you take into account the impact of incentives on employee creativity, innovation, and willingness to improve their own quality, incentives will have a greater impact on performance.
3. Retain excellent talents.
P.Druker believes that every organization needs three aspects of performance: immediate results, realization of value, and future human development. Without any aspect of performance, the organization is doomed to collapse. Therefore, every manager must contribute in all three aspects. In the three aspects of contribution, the contribution of "future human development" comes from the incentive work.
4. Create a benign competitive environment.
The scientific incentive system guarantees a competitive spirit, which can create a benign competitive environment and form a benign competition mechanism. In a competitive environment, the organization's members will be under pressure from the environment, which will transform into the motivation for employees to work hard. As Douglas m. McGregor puts it: "competition between individuals and individuals is one of the main sources of motivation." Here, the motivation and motivation of employees are the indirect result of incentive work.
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