INCENTIVE COMPENSATION AND ORGANIZATIONAL PERFORMANCE (A STUDY OF SELECTED OIL COMPANIES IN SOUTH-SOUTH, NIGERIA)

Abstract

The study examined Incentive Compensation and Organizational Performance (A study of selected oil companies in South-South, Nigeria). The study sought to determine how Individual incentive pay plan compensation affects organizational productivity, ascertain how piece-rate system of compensation affects organizational productivity, investigate how sales commission of compensation affects organizational productivity, and determine how nonmonetary incentive of compensation affects organizational productivity. The field survey design method was adopted. The population comprises all staff of the selected oil companies’ employees, totally 978 with sample size of 600. Instrument for data collection was questionnaire, mean score rating were used to analyze the research questions and their associated hypotheses were tested with Pearson Product Moment Correlation Coefficient Analysis. The findings shows that significant relationship exist between individual incentive pay plan of compensation and organizational Productivity, between piece-rate system of compensation and organizational productivity, between sales commission of compensation and organizational productivity and between nonmonetary incentive compensation and organizational productivity. The study concludes that the organization management emphases their employees compensation on performance based rewards which ensures that employees are rewarded based on performance on a real-time basis. The following recommendations were made, that management of the oil companies should put in place individual incentive pay plan of compensation, piece-rate system of compensation, sales commission compensation and  nonmonetary incentive compensation policy that will improve the organizational productivity, etc.