Project Management Institute

Incentive programs in construction projects

the contingency approach

Incentive programs have long been held as a means to improve production in projects. A study was undertaken to investigate the most influential factors in construction labor force incentive programs. A questionnaire was sent to the first two hundred largest construction companies in the United States as ranked in the Top 400 Contractors listed annually by the Engineering News Record. In addition, 21 construction managers of small to medium sized construction companies in Texas were interviewed face to face. The questionnaire and interviews covered six incentive programs, which factored in the following situations: organizational climate, quality of management, project size, project complexity, project uncertainty, and nature of task. The study concludes that the most effective incentive program is monetary. This study substantiates the contingency approach claim that any way is not equally effective under all conditions.
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