MOTIVATION &

REWARD SYSTEM
Prof. Meera Madhavan
Dhruva College of Management

Presented by:
LEIZEL B. DOBLON-CONSTANTINO
 Motivation defined
• A motive is a reason for doing something – for moving
in a certain direction.

• People are motivated when they expect that a course

of action is likely to lead to the attainment of a goal –
a valued reward that satisfies their particular needs.

• Well-motivated people are those with clearly defined

goals who take action that they expect will achieve
those goals.
 Need Theories: A Comparison
Growth needs

5. Self-actualization needs
• Growth needs
4. Esteem needs
Deficiency Needs

3. Social needs • Relatedness needs

2. Safety needs
• Existence needs

1. Physiological needs

Maslow’s need hierarchy theory Alderfer’s ERG theory

4
 ERG Theory
(Aldefer)
Relatedness Needs

Existence Needs Growth Needs

Satisfaction/Progression

Frustration/Regression
Satisfaction/Strengthening
 Motivation theories and their practical
implications
Theory Theorist Summary of Theory Practical Implications

Instrumentality Taylor People will be motivated Conceptual basis of

to work if rewards and incentive and pay-for-
penalties performance
are tied directly to their schemes
performance.
Needs Maslow Unsatisfied needs create Identifies a number of
tension and is equilibrium. key needs for
To restore the balance a consideration in
goal is identified that will developing total reward
satisfy the need, and a policies.
behavior pathway is
selected that will lead to
the achievement of
the goal. Only unsatisfied
needs motivate.
 Motivation theories and their practical
implications
Theory Theorist Summary of Theory
Two-factor Herzberg The factors giving rise
to job satisfaction (and
motivation) are distinct from the
factors that lead to job
dissatisfaction. Any feeling of
satisfaction resulting from pay
increases is likely to be short-
lived compared with the long-
lasting satisfaction from the
work itself. Makes a distinction
between intrinsic motivation
arising from the work itself and
extrinsic motivation provided by
the employer, eg pay.
Practical Implications
A useful distinction is
made between intrinsic
and extrinsic motivation
that influences total
reward decisions. The
limited motivational
effects of pay increases
are worth remembering
when considering
the part contingent pay
can play in motivating
people.
 Motivation theories and their practical
implications
Theory Theorist Summary of Theory
Expectancy Vroom Motivation is likely only
when: 1) a clearly
perceived and usable
relationship exists between
performance and outcome;
and 2) the outcome is seen
as a means of satisfying
needs.
Practical Implications
Provides the foundation for
good practice in the design
and management of
contingent pay. The basis for
the concept is the ‘line of
sight’, which emphasizes
the importance of establishing
a clear link between the
reward and what has to be
done to achieve it.
 Motivation theories and their practical
implications
Theory Theorist Summary of Theory
Goal Latham Motivation and performance
and Locke are higher when individuals
are set specific goals, when
the goals are difficult but
accepted, and when there is
feedback on performance
Equity Adams People will be better
motivated if they are treated
equitably and demotivated if
they are treated inequitably.
Practical Implications
Provides a theoretical
underpinning for performance
management processes to
ensure that they contribute to
motivation through goal
setting and feedback.
Emphasizes the need to
develop an equitable reward
system involving the use of
job evaluation
 THE KEY MESSAGES OF MOTIVATION
THEORY
The key practical messages delivered by motivation theory are
summarized below.
Extrinsic and intrinsic rewards
• Extrinsic rewards provided by employers in the form of pay will
help to attract and retain employees and, for limited periods,
may increase effort and minimize dissatisfaction.
• Intrinsic non-financial rewards related to responsibility,
achievement and the work itself may have a longer-term and
deeper impact on motivation.
• Reward systems should therefore include a mix of extrinsic
and intrinsic rewards.
 THE KEY MESSAGES OF MOTIVATION
THEORY
The significance of needs
• People will be better motivated if their work satisfies their
social and psychological needs as well as their economic
needs.
• Needs theory underpins the concept of total reward, which
recognizes the importance of the non-financial rewards as
motivators.
• Performance management processes provide a basis
for redesigning jobs or roles and for agreeing and implementing
development programmes.
Discussion: Considering these
theories, how might
companies motive their
employees
• What types of incentives would motivate
employees?
• How can employers satisfy employees’
needs?
• Would the same type of incentives or
rewards satisfy all employees?
 TYPES OF MOTIVATION
(by Herzberg)
Intrinsic motivation – this was defined by Herzberg as
‘motivation through the work itself’. It takes place
when people feel that the work they do is,
 intrinsically interesting
 challenging and important and involves the exercise
of responsibility (having control over one’s own
resources)
 autonomy or freedom to act
 scope to use and develop skills and abilities
 opportunities for advancement and growth
 TYPES OF MOTIVATION
Extrinsic motivation – what is done to or for
people to motivate them. This includes

• rewards such as increased pay, recognition,

praise or promotion, and
• punishments such as disciplinary action,
withholding pay, or criticism.
TYPES OF REWARDS
 The role of job design in
motivation
Intrinsic motivation is provided when jobs are well
designed. This is the case when the job has the
following characteristics:
• autonomy, freedom of choice, self-control and
responsibility;
• variety;
• use of abilities;
• availability of constructive feedback;
• belief that the work is significant.
 The role of rewards and incentives in
motivation
• Rewards provide recognition to people for their
achievements and contribution. If rewards are worth
having and attainable and people know how they can
attain them, they can act as motivators. Rewards can be
either financial or non-financial.
• Incentives are designed to encourage people to achieve
objectives. They are intended to provide direct motivation:
‘do this and we will make it worth your while’. Incentives
are generally financial but they can promise non-financial
rewards such as recognition, promotion or a particularly
interesting assignment.
 The meaning of employee engagement

• Employee engagement takes place when people are

committed to their work and their employer and are
motivated to achieve high levels of performance.

• An "engaged employee" is one who is fully involved in, and

enthusiastic about, his or her work, and thus will act in a
way that furthers their organization's interests.

• According to Scarlett Surveys, "Employee Engagement is

a measureable degree of an employee's positive or
negative emotional attachment to their job, colleagues and
organization which profoundly influences their willingness
to learn & perform at work".
 Employee Engagement
The factors that influence engagement
• work and job design
• the quality of life provided by the working environment
• the quality of leadership

The role of reward in enhancing engagement

• A total rewards approach is required to increase
engagement. Financial rewards are insufficient and the
major levers are provided by non-financial reward,
especially those provided by intrinsic motivation, the
work environment and line managers.
 COMMITMENT

Commitment, sometimes referred to as

organizational commitment, refers to
identification with the goals and values of the
organization, a desire to belong to the
organization and a willingness to display effort
on its behalf.
Impact of employee engagement and
organizational commitment
MODEL OF FACTORS AFFECTING
ENGAGEMENT
Six steps to enhancing engagement through
reward
1. Analyze the existing performance culture of the organization
and develop an engagement.
2. Define the drivers of engagement (and disengagement) for
different categories of employees.
3. Assess and define the reward elements that affect engagement
and develop reward programmes that will enhance these
different aspects of engagement.
4. Introduce a total rewards approach that brings together all the
reward elements (pay and non-pay) that engage staff.
5. Segment total reward to take account of key employee
differences.
6. Implement the total rewards approach and measure and
evaluate its impact and success.
Posters work
"Winners must have two things; definite goals and a burning desire to achieve them."
 Thank you
for your attention!