Incentives can be direct or indirect compensation used to motivate employees and improve organizational performance. There are various types of incentives including piecework plans, merit pay, bonuses, spot awards, and non-cash recognition. Incentives provide benefits like higher efficiency, productivity, and reduced absenteeism and turnover. Incentives can be financial, recognition-based, rewards-based, or meant to show appreciation. They may also be remunerative, moral, coercive, natural, personal, or social.