Employee understands that reputation of the firm lies on their performance, which will also influence the production. Employees also understand that relational incentive contract depends upon their promise to care about the reputation of the employees in the labor market. Thus, this kind of incentive works as the high level of motivation for the employees as well as for the managers, where they have responsibility of improving their personal performance, as well as performance of the team. Incentive works as a motivational factor for the performance of the employees in any organization. The types of incentives are also changing with time to keep staff motivation and staff retention. There are two types of situation associated with motivation of the employees in different industry. The first thing is that employees have to motivate themselves for providing the excellent quality services. The second is that the managers have to develop workplace environment and incentives for accommodating the needs of employees. Assuming that every person wants same thing from their workplace, can be a wrong assumption. It is because every person has different expectations from their work. Providing the incentive in the form of ‘employee of the month’ plaque can be very beneficial for the managerial employees, and can lead to competition and cynicism in other departments.
Thus, type of incentive in every department is different and depends upon the needs and expectation of the employees. It has been found that employees prefer consistent rewards for their jobs, which keeps them motivated for continuously providing the quality services. Managers are benefitted by the performance enhancement of the employees and improve the organizational reputation.Incentives in the current time are the great source of keeping the employees motivated. The stakeholders who get benefits from the incentives are the manager, employees and also guests. Managers improve employee performance through motivational incentives and bring back more benefit to the organization. Guests receive better services from the hotel and employee, as motivated employees are more dedicated and hardworking (Chen, 2013). With the changing economy, the companies in hospitality require motivated and competitive staff, which may also have problem solving skills and time management skills. Incentives help employee to develop more dedication and problem solving skills.