Material incentives are the most frequently used incentives for employees in most small and medium-sized enterprises in China. Under this traditional incentive system, employees' contributions to the company will only be reflected through their current income, and the evaluation standard for employees mainly depends on the current personal performance, which is not linked to the future development of the company, and will not give employees certain long-term incentives. In this way, it can be clearly seen that there is no correlation between the change of enterprise value in the market system and the incentive mechanism for employees. Of course, many enterprises are disturbed and affected by multiple factors such as the social environment, the small industry environment, and the thinking of managers. Sometimes, problems such as the idea of employment opposition, employees' unwillingness to participate in enterprise construction, and poor team cooperation consciousness occur. The exposure of these problems is not only not conducive to the recruitment of more high-quality and highly skilled talents, but also leads to the increase of internal employee turnover rate.
1、 The background and significance of studying the incentive mechanism of small and medium-sized enterprises
In the process of enterprise development, incentive mechanism is very important. Many small and medium-sized enterprises have also been aware of this problem, and are exploring to establish a set of incentive mechanism. However, in combination with the actual situation, there are still some small and medium-sized enterprises that have limited their development or are on the verge of bankruptcy because the incentive mechanism they have established is not in line with their own reality, while some small and medium-sized enterprises are copying the incentive mechanism of large enterprises or other enterprises, and the result is contrary to their wishes in the past.
Different enterprises have their own unique characteristics and advantages, and small and medium-sized enterprises are no exception. Therefore, such enterprises can refer to successful experience and use scientific theories when establishing incentive mechanisms, but they must conform to their own reality. Only in this way can they better solve the problems that hinder the development of enterprises, win more benefits for employees, and give more and better incentives, so that enterprises can maintain their advantages in market competition.
2、 Current situation and existing problems of incentive mechanism in small and medium-sized enterprises
（1） The incentive system is not perfect
Incentive system is the sum of various measures to guide and standardize employees' behavior to the common goal. Employees are the most valuable asset of an enterprise. Behind the development, production, sales, after-sales and completion of any process of any product, many employees are silently dedicated. Therefore, a qualified enterprise should have a perfect incentive system, which can not only create a good working environment for employees, but also ensure the smooth realization of enterprise goals. However, in some small and medium-sized enterprises, the incentive reward and punishment system is neither reasonable nor perfect. The evaluation and reward and punishment of employees completely depend on the managers' own perceptual cognition. Over time, employees will feel unfair and lose confidence in the enterprise, which will hinder the benign development of the enterprise. At present, there are some problems in small and medium-sized enterprises, such as unfair salary design, imperfect system, chaotic financial management, and weak external competitiveness, which will inhibit or even kill the enthusiasm of some employees to work to a certain extent, and the root cause of these problems is the lack of a perfect incentive system within the enterprise.
（2） Imbalance between material incentives and spiritual incentives
Material is not only the first need of human life, but also the basic motivation for people to engage in all social activities. Therefore, material incentive is the most frequently used incentive method in all enterprises at present. However, with the development of modern society, people's attention has shifted to the spiritual needs. At present, this incentive method of "emphasizing material and neglecting spirit" and ignoring the organic combination of material incentive and spiritual incentive not only leads to the increase of investment in the use of material incentive mode by many small and medium-sized enterprises, but also sometimes attacks the enthusiasm of employees to participate in enterprise management, which not only fails to achieve the expected purpose, but also hinders the development opportunity of enterprises.
（3） Single incentive methods and means
Meeting the needs of the vast majority of employees within the enterprise is the fundamental starting point for enterprises to use incentives. However, employees of different positions and ages have different needs for themselves, and this demand will show some dynamics. Therefore, the ways and means of encouraging employees should also actively adapt to the social environment, enterprise positioning and employee needs, and constantly adjust. However, from the current situation, most managers believe that using money to stimulate employees is the best incentive. They believe that employees only pursue money. Although some enterprises will give managers and technicians year-end rewards such as travel and vacation based on performance, and some enterprises are promoting employee stock ownership, these are relatively imperfect, so at this stage, enterprises' incentive methods and means for employees are relatively simple.
（4） The quality of managers is not high
Some small and medium-sized enterprises are limited by their development characteristics and conditions, resulting in their lack of understanding of the importance of incentive mechanisms. The management mode of most small and medium-sized enterprises in China belongs to the parental system, which leads to the unclear or incomplete understanding of the important role of the incentive mechanism and its impact on the survival and development of enterprises. At the same time, the management concept of enterprise managers is backward and does not keep pace with the times. In the process of management, they are centralized and authoritarian. They can neither fully recognize the role of the incentive mechanism on the enterprise, nor communicate with employees, nor understand the real demands of employees. They even regard employees as "working machines", and do not listen to or adopt the reasonable suggestions of employees. These thoughts and behaviors will hinder the construction and improvement of the incentive mechanism. In addition, some managers lack experience in enterprise management and have great subjectivity, blindness and randomness in management. Some principles and measures formulated from this starting point will dampen the enthusiasm of employees to participate in enterprise management, and thus have a serious impact on the implementation effect of the incentive mechanism.
（5） Imperfect enterprise performance evaluation
The performance evaluation system is the most fundamental basis for enterprises to establish an effective incentive mechanism in the process of development. Up to now, many small and medium-sized enterprises in China still lack a scientific and reasonable performance evaluation system. They usually use traditional hard indicators to evaluate employees, do not disclose the evaluation process, and only give the final evaluation results. In this way, they cannot reflect the advantage effect of incentives, but will dampen the enthusiasm of some employees, thus bringing adverse effects on the establishment and implementation of incentive mechanisms.
3、 Suggestions and Countermeasures for improving the incentive mechanism of small and medium-sized enterprises
（1） Implement differentiated and diversified incentive methods
The process of integrating incentive means, incentive methods and incentive purposes to achieve the consistency of incentive means and effects is incentive mechanism. According to Maslow's hierarchy of needs theory, only when leaders fully understand and master the demands of employees, can they be motivated and rewarded according to the various needs of employees of different positions, ages and types. Both adults and children are eager to be recognized. For enterprise employees, it is a blessing to find the greatest self satisfaction in the enterprise. Therefore, managers must first understand what is the most attractive thing for their employees. Secondly, we should understand the main factors that affect the enthusiasm of employees. Finally, we should understand the needs of employees and classify them into six aspects: primary, secondary, reasonable, unreasonable, can be met now, and can only be achieved in the future. Combined with the above contents, according to different people, different jobs and different situations, fully consider the characteristics of the enterprise and individual differences of employees, and implement diversified and differentiated incentives, so as to receive the maximum incentive effect.
（2） Improve the quality of managers
Incentive mechanism is very important for the operation and management of enterprises, and small and medium-sized enterprises cannot ignore the incentive mechanism used in the development process. Due to the special nature of small and medium-sized enterprises, managers have defects in leadership style and personal quality, which is likely to be detrimental to the establishment, development and perfection of incentive mechanism. Therefore, as managers of enterprises, they should not only actively study modern management concepts and strive to improve their own quality, but also learn to arm themselves with modern management knowledge and let themselves grow into standard and qualified managers of small and medium-sized enterprises. Only in this way can they play a good role in promoting the establishment and improvement of enterprise incentive mechanism. Of course, managers should also adhere to the concept of "people-oriented", establish and improve the incentive mechanism in combination with the actual situation of the enterprise, and promote the development of the enterprise.
（3） Build a scientific performance evaluation system
The establishment of a reasonable and scientific performance evaluation system in the process of enterprise development can not only reflect the affirmation of enterprise managers on the work of employees, but also provide a basic guarantee for the subsequent establishment of incentive mechanism. An enterprise without a performance evaluation system is like a car without an engine. Without reasonable performance appraisal, it is impossible to give effective rewards and incentives to enterprise employees. Therefore, enterprises should listen to and look at the reasonable opinions and suggestions of employees, and adopt them appropriately. In combination with the actual needs of employees, they should build a performance evaluation system that conforms to the reality of enterprise development, is scientific, reasonable, convincing, and protects the interests of employees.
（4） Combined use of various incentive mechanisms
When establishing the incentive mechanism, enterprises should consider both material incentives and spiritual incentives, and effectively combine the two. In the process of implementation, we should also give both material incentives and spiritual incentives, not only to motivate excellent employees, but also pay attention to the motivation of the team. At the same time, it is also necessary to effectively integrate short-term and long-term incentives. Managers should always adhere to the principle of "positive incentives first, supplemented by punishment", do not exert too much pressure on employees, and learn to use a variety of joint incentive mechanisms, which can not only make employees feel at ease and work hard, but also effectively protect the benefits of the enterprise.
（5） People oriented and emotional motivation
Human beings cannot avoid emotion, and enterprise employees are just ordinary people. Therefore, emotional factors also have a great incentive effect on them. Emotional motivation refers to an incentive method between leaders and the led by means of emotional connection, which stimulates their enthusiasm and creativity through care and love for employees. Enterprise managers should learn to use and be good at using emotional incentives. They should not only convince people by virtue and reason, but also learn to be emotional, think about what employees think, be anxious about what employees are anxious about, and really care about and respect employees. This can not only ensure the turnover rate of high-end technical talents, but also ensure the development momentum of the enterprise.
（6） Strengthen the incentive function of corporate culture
Corporate culture is a group consciousness, code of conduct, environmental image, etc. created by an enterprise in its business activities and recognized by all employees of the enterprise. It is an important part of the core competitiveness of an enterprise and also the soul of an enterprise. An enterprise with a good culture will have a relatively harmonious and harmonious internal working environment and employee relations. Such an environment will enable employees to maintain a good and positive attitude, and also promote the improvement of work effect and work quality from the side.
In the fierce market competition, if small and medium-sized enterprises want to maintain their own advantages, they must really mobilize the enthusiasm of employees, and the establishment of their own corporate culture is the basis for achieving this goal. Excellent corporate culture is an internal incentive. If we can effectively combine corporate culture, development prospects and employees' personal development, we will certainly be able to better promote the development of the enterprise.
4、 Conclusion
In a word, the incentive mechanism is to combine the actual situation of the enterprise and use scientific and reasonable means to mobilize the enthusiasm of employees. For the development of small and medium-sized enterprises, it is very necessary and beneficial to establish and improve the incentive mechanism. Therefore, small and medium-sized enterprises should combine their own development reality and characteristics, timely establish an incentive mechanism that suits the future development direction of the enterprise, conforms to the enterprise culture and the vital needs of employees, and pay attention to and make appropriate adjustments when finding problems. Only in this way can they mobilize the enthusiasm of employees to the greatest extent, stimulate their potential, and ensure that enterprises are invincible in the fierce market competition.