INCENTIVES IN INDUSTRY

Press, Volume XCIV, Issue 28047, 15 August 1956, Page 14

INCENTIVES IN INDUSTRY

CAUTION ADVISED

Unless many of the non-financial incentives at present used in New Zealand industry—such as the provision of housing, extra holidays, buying privileges, and superannuation or other retirement schemes—were used judiciously, they would not act as incentives at all. This view was put by Mr Denis ■McClure, an Auckland industrial consultant. in an address to the Canterbury branch of the New Zealand Institute of Cost Accountants in Christchurch. Mr McClure is president of the Auckland branch of the New Zealand Institute of Management.

To be effective, an incentive must be of the right kind, of the right amount, and at the right time and place, Mr McClure said. “In some circumstances a variety of incentives may be better than one large incentive,” he said. “But. on the other hand, if the incentive is so small as to be unattractive, there will be little response, and the net result may be a poorer rather than a better return for the outlay.” Suitable indirect or non-financial incentives could greatly increase the power of direct financial incentives, said Mr McClure. “People must be continuously aware both of the incentive itself, and of the objective to be realised. Their response to the outside stimulus—the incentive—will be affected by their inner motives and attitudes.

“The relationship between leader and followers, and the example of the leader, and his ability to arouse action, may be found to be of more importance than any offer of direct award.” he said.