Read the following passage and answer question.

Directing refers to the process of instructing, guiding. counselling, motivating and leading people in the organisation to achieve its objectives. Directing is a managerial process which takes place throughout the life of the organisation irrespective of people occupying managerial positions. In the organisation every individual effort contributes to the organisational performance. Thus it ensures that the individual work for organisational goals.

One of the principle of Directing emphasises that directing techniques must help every individual in the organisation to contribute to his maximum potential for achievement of organisational objectives. In the organisation different techniques are used to motivate people such as pay, bonus, promotion, recognitions, praise, responsibility etc. and also different financial incentives are used. Under one of such incentive schemes employees are offered company shares at a predetermined price which is lower than market price.

Under which financial incentive schemes, employees are offered company's shares at a predetermined price which is lower than market price?

Co-partnership

The correct answer is option (2)- Co-partnership.

Co-partnership is the financial incentive schemes, employees are offered company's shares at a predetermined price which is lower than market price.

Co-partnership/ Stock option: Under these incentive schemes, employees are offered company shares at a set price which is lower than market price. Sometimes, management may allot shares in line of various incentives payable in cash. The allotment of shares creates a feeling of ownership to the employees and makes them to contribute for the growth of the organisation. In Infosys the scheme of stock option has been implemented as a part of managerial compensation.

OTHER OPTIONS

• Retirement Benefits: Several retirement benefits such as provident fund, pension, and gratuity provide financial security to employees after their retirement. This acts as an incentive when they are in service in the organisation.

• Profit Sharing: Profit sharing is meant to provide a share to employees in the profits of the organisation. This serves to motivate the employees to improve their performance and contribute to increase in profits.

• Bonus : Bonus is an incentive offered over and above the wages/salary to the employees.