An incentive system increases motivation by linking rewards to performance outcomes. Ideally, the employee puts in more effort and, consequently, earns more rewards. However, employees do not operate within a vacuum: An employee’s investment of effort does not guarantee that measured performance will increase. Specifically, employee performance outcomes are not completely under the employee’s control, because performance is the combination of an employee’s effort and other factors.
These other factors influencing performance may include common occurrences, like weather or traffic conditions that disrupt key ...
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