Chapter Overview

y Employee performance depends on motivation to

perform.
y Motivation leads to good performance when it is

accompanied by
y y y y y

ability, skills, equipment, supplies, and time.

y The chapter includes many theories of motivation. y Content theories of motivation attempt to identify what things motivate people. y Maslow s hierarchy of needs, y McClelland s theory of achievement, power, and affiliation needs, and y Herzberg s two-factor theory of motivation are explained.

y Process theories look at the process of motivation

rather than specific motivators.

y Included are y Vroom s expectancy-valence theory, and y Skinner s reinforcement theory.

y All of the theories depend on the individual s

perception of what is a valued motivator.

y What will be perceived as a motivator depends on the

individual s needs.

y Some supervisors and other managers assume that

the main thing employees want out of a job is money.

y While money can be a motivator, it is not the only motivator,

and for some people it is not the most important motivator. y For money to motivate, it must meet employee needs, and employees must believe they are able to achieve the financial rewards the organization offers.

y Several financial incentives are discussed, including

y piecework systems, y production bonus systems, y commissions, y suggestion plans, y group incentive plans, y profit-sharing, and y gain sharing.

y Supervisors will likely have limits on the types of

motivators they can use.

y But they can motivate their employees by making work

interesting through such means as

y y y y

job rotation, job enlargement, job enrichment, and contact with users of the product or service.

y Other ways to motivate include y having high expectations of employees, y providing rewards that are valued, y relating rewards to performance, y treating employees as individuals, y encouraging employee participation, and y providing feedback, including praise.

Relationship between Motivation and Performance

y Motivation: Giving people incentives that cause

them to act in desired ways. y The objective of motivating employees is to lead them to perform in ways that meet the goals of the department and the organization. y Because supervisors are largely evaluated on the basis of how well their group as a whole performs, motivation is an important skill for supervisors to acquire.

y Employees ultimately decide how they are going to

perform or not perform.

y A supervisor can influence employees behavior through

the use of rewards and other incentives. y Supervisors are a significant factor in creating the environment in which employees work.

y Flextime: a policy that grants employees some leeway

in choosing which eight hours a day or which 40 hours a week to work. y Job sharing: an arrangement in which two part-time employees share the duties of one full-time job.

y Content theories of motivation focus on the content

of the motivator. y Three researchers whose content theories of motivation are widely used are
y Abraham Maslow, y David McClelland, and y Frederick Herzberg.

Maslow s Hierarchy of Needs

y Maslow assumes that what motivates people is

unmet needs. y According to Maslow, the needs that motivate people fall into five basic categories:
y physiological needs (the most basic need), y security needs, y social needs, y esteem needs, and y self-actualization needs (the highest-level need).

y y y

Physiological needs are the ones required for survival. Security needs involve keeping oneself free from harm. Social needs are the desire for love, friendship, and companionship. Esteem needs are the need for self-esteem and the respect of others. Self-actualization needs describe the desire to live up to one s full potential. People may be seeking to meet more than one category of needs at a time.

McClelland s Achievement-PowerAffiliation Theory

y This motivation theory is based on the

assumption that through life experiences, people develop various needs.

y The three needs include:
y

(1) The need for achievement

y

the desire to do something better than it has been done before. the desire to control, influence, or be responsible for other people. the desire to maintain close and friendly personal relationships.

(2) The need for power

y

(3) The need for affiliation

y

y People have all of these needs to some extent. y The relative strength of the needs influences what will

motivate a person.

Hertzberg s Two-Factor Theory

y Employees satisfaction and dissatisfaction stem from

different sources.
y Dissatisfaction results from the absence of what

Hertzberg calls hygiene factors.

y y

salary relationship with others

y Satisfaction results from the presence of motivating

factors.
y

opportunities

y The supervisor has control of many of the motivating

factors, including
y recognition, y responsibility, y advancement, and y personal growth.

Process Theories of Motivation

y Another way to explain motivation is to look at it as a

process. y Two major process theories are expectancy-valence theory and reinforcement theory.

Vroom s Expectancy- Valence Theory

y Victor Vroom assumes that people act as they do to

satisfy needs they feel. y He sets out to explain what determines the intensity of people s motivation.

y He explains that motivation depends on two things: y (1) Valence

y

the value a person places on the outcome of a particular behavior. the perceived probability that the behavior will lead to the outcome.

y (2) Expectancy
y

y The strength of motivation equals the perceived value

of the outcome times the perceived probability of the behavior resulting in the outcome.
y In other words, people are most motivated to seek

results they value highly and think they can achieve.

y This theory is based on employees perceptions of

rewards and whether they are able to achieve those rewards.

y It is important to note that employees may place different

values on rewards and their ability to achieve the outcome than does the supervisor. y Supervisors need to determine from the employees what is rewarding and what is possible to achieve.

Skinner s Reinforcement Theory

y B. F. Skinner says that people behave as they do

because of the kind of consequences they experience as a result of their behavior.

y Broadly speaking, people keep doing things that lead to

consequences they like, and avoid doing things that have undesirable consequences.
y

For example, praise feels good, so people tend to do things that get them praised.

y Supervisors can encourage or discourage a particular

kind of behavior by the way they respond to the behavior.

y Consequences can be thought of as:
y

(1) Reinforcement y the desired consequence for behavior. y This term is used to indicate positive consequences for desired behavior. y This is also used to indicate the outcome for ceasing negative behavior.

(2) Punishment y an unpleasant consequence of a behavior a supervisor wants to end. y This is sometimes described as negative reinforcement

y Behavior Modification: The use of reinforcement

and punishment to motivate people to behave in certain way.

y For long term results, positive reinforcement is more

effective than punishment. y Punishment can lead to what is called learned helplessness.
y

Employees who are repeatedly punished will eventually believe that they are unable to succeed.

y Supervisors must consider individual differences in

designing rewards.
y What motivates one person may not motivate another.

y Likewise, not all rewards are under the control of the

supervisor.
y Organizational policy, labor contracts, and laws may

dictate what an employee may receive.

Financial Incentives
y Some supervisors and other managers assume that

the main thing employees want out of a job is money.

y Based on the content theories of motivation, it makes sense to

say that money motivates people when it meets their needs.

y

When a person has high financial demands and relatively low income, money may be a motivator. If an individual is financially comfortable, nonfinancial rewards, such as a sense of accomplishment, are increasingly important.

Laffer Curve
$

Time at Work

Incentive Pay Plans

y Financial Incentives: Payments for meeting or

exceeding objectives.

y There are a variety of pay systems that include

additional incentives for productivity of employees.

y Included are:
y y y y y y

Piecework system. Production bonus system Commissions Payments for suggestions Group incentive plans Gain sharing

Piecework system
y Piecework System: Payment according to the amount

produced. y This system pays people according to how much they produce.
y Piecework pay systems are usually
y y

based on an individual s performance, but may be based on the department s overall performance. y It is often used to pay independent contractors, for example, farm workers and independent writers.

Production bonus system

y Employees in a production department may receive a

basic wage or salary plus a bonus that consists of a payment for units produced.
y This method has been used extensively in manufacturing.
y

It is less common today. y inconsistent with producing quality because it emphasizes quantity y often includes a quality factor where a bonus is paid on good units produced

Commissions
y In a sales department, employees may earn

commissions.
y the payment linked to the amount of sales completed
y

Most organizations that pay a commission also pay a basic wage or salary.

Payments for suggestions

y In companies with suggestion programs, employees

are paid for suggestions for improvements.

y Typically, for the employee to receive payment, the

suggestion must be adopted or save some minimum amount of money. y A common practice is for payment to be linked to the saving realized.

Group incentive plans

y The group incentive plan pays a bonus when the group

as a whole exceeds some objective.

y For example, a company may pay a bonus when a

department, sales region, or other work unit meets sales goals. y The bonus may also depend on meeting organizational goals either by itself or in combination with work unit goals.

Gain sharing
y An extension of the group incentive plan. y The company encourages employees to participate in making suggestions and decisions on how to improve the way the company or work group operates. y As performance improves, employees receive a share of the greater earnings.
y

Seeks to motivate through financial rewards and psychological rewards.

Pay Information
y In our society money is considered a private matter,

and most people don t talk about what they earn. y Does secrecy help or hurt?
y To motivate employees, the organization must let them

know what they hope to earn.

y

Organizations often publish pay ranges.

y Making work interesting increases the likelihood of

employees giving work their full attention and enthusiasm. y Some ways to make work more interesting are
y job rotation, y job enlargement, and y job enrichment

Job rotation
y Job rotation involves moving employees from job to

job so as to give them more variety.

y Job rotation requires that employees have relatively broad

skills.
y

This means the supervisor and organization must provide for cross-training or training in the skills required to perform more than one job. The opportunity to learn new skills can in itself motivate employees.

Job enlargement
y Job enlargement means that duties are added to a job. y For example, in a factory a machine operator may be given the added task of setting up the machine.

Job enrichment
y Job enrichment is the incorporation of motivating

factors into a job.

y The kinds of factors that are considered to enrich a job

are the ones Herzberg called motivators.

y

Specific factors include y giving employees more responsibility to make decisions, y more recognition for good performance, and y making jobs more challenging.

y When jobs are modified to make them more

interesting, it is important for the organization and supervisor to remember that not all employees are motivated by the same things or at the same time.
y Some employees will see job modification as a way to get

them to do more for the same amount of money.

y

This may also be true of job rotation and job enlargement.

y Another way to make work meaningful is to give

employees some contact with the people who receive and use their products or services.
y Sometimes the supervisor can arrange to have workers

visit the users of the products or services.

y For example, when a user of manufactured products is

having trouble, a visit from employees may serve two purposes.

y First, employees may be able to help the user of the

product. y Second, employees will learn and understand more about the product from the users point of view.

The Pygmalion Effect

y The Pygmalion effect is the direct relationship

between expectations and performance.

y This is similar to the well-used phrase of self-fulfilling

prophesy.
y

When a supervisor relates the message that he or she does not expect employees to be able to accomplish a task, it is likely they won t. However, if the supervisor conveys high expectations, employees are likely to succeed.

y Providing rewards that are valued is very important. y The content theories of motivation indicate that a

variety of rewards may motivate and that not all employees will value the same rewards at the same time.

y The supervisor s challenge is to determine what

rewards will work for particular employees at particular times.

y Although supervisors may not be able to control some

rewards such as wages or benefits,

y

they have great freedom to administer rewards such as praise and recognition. Supervisors may have discretion in job assignments and additional training opportunities.

y Whatever rewards the supervisor uses, they should be

recognized by the employee as linked to performance.

y If there is a connection, employees should be aware of it

and understand it. y Linking rewards to the achievement of realistic objectives is a way to help employees believe they can attain desired rewards.

y If a supervisor is to succeed at motivating, he or she

has to remember that employees will respond in varying ways. y As much as possible the supervisor should respond to individual differences.
y

Communication with employees is a necessary ingredient in learning about employees. Encouraging employees to participate will help the supervisor learn more about the employee. People also want to know how they are doing.

y Feedback will provide the employee with

information to help them move closer to accomplishing personal, department, and company goals. y This will also provide the supervisor with an opportunity to praise an employee. y The attention of the supervisor may also be motivating to the employee whether the feedback is positive or a corrective action.

y Commissions:

Payment linked to the amount of

sales completed. y Commissions may be the only source of pay, such as for sales personnel who sell real estate, or it may be a portion of an employee s pay, such as in a department store where a small commission is added to wages.