Chapter 7 Motivating Employee Performance Fundamentals of MANAGEMENT Core Concepts & Applications Griffin Eighth Edition Chapter 7 Motivating Employee Performance .

Chapter Outline The Nature of Motivation Content Perspectives on Motivation The Need Hierarchy Approach The Two-Factor Theory Individual Human Needs Process Perspectives on Motivation Expectancy Theory Equity Theory Goal-Setting Theory

Chapter Outline (cont’d) Reinforcement Perspectives on Motivation Kinds of Reinforcement in Organizations Providing Reinforcement in Organizations Popular Motivational Strategies Empowerment and Participation New Forms of Working Arrangements Using Reward Systems to Motivate Performance Effects of Organization Rewards Designing Effective Reward Systems Popular Approaches Made to Client

Learning Objectives After studying this chapter, you should be able to: Characterize the nature of motivation, including its importance and basic historical perspectives. Identify and describe the major content perspectives on motivation. Identify and describe the major process perspectives on motivation. Describe reinforcement perspectives on motivation. Identify and describe popular motivational strategies. Describe the role of organizational reward systems in motivation.

The Nature of Motivation The set of forces that cause people to behave in certain ways. The goal of managers is to maximize desired behaviors and minimize undesirable behaviors. The Importance of Motivation in the Workplace Determinants of Individual Performance Motivation—the desire to do the job. Ability—the capability to do the job. Work environment—the resources needed to do the job.

motivation Motivation is the psychological feature that arouses an organism to action toward a desired goal and elicits (causes), controls, and sustains certain goal directed behaviors. For instance: An individual has not eaten, he or she feels hungry, and as a response he or she eats and diminishes feelings of hunger.

The Motivation Framework Search for ways to satisfy need Choice of behavior to satisfy need Determination of future needs and search/choice for satisfaction Evaluation of need satisfaction Need or deficiency The motivation processes through a series of discreet steps. Content, process, and reinforcement perspectives on motivation address different parts of this process. Figure 10.1

Content Perspectives on Motivation Focus on needs and deficiencies of individuals Approaches to motivation that try to answer the question, “What factors in the workplace motivate people?” Content Perspectives of Motivation Maslow’s Hierarchy of Needs Herzberg’s Two-Factor Theory McClelland’s Achievement, Power, and Affiliation Needs

Maslow’s Hierarchy of Needs Abraham Maslow in 1943 Self- actualization Esteem Belongingness Security Physiology Food Achievement Status Friendship Stability Job Friends Pension Base NEEDS General Examples Organizational Examples job Challenging title at work plan salary Source: Adopted from Abraham H. Maslow, “A Theory of Human Motivation,” Psychology Review, 1943, Vol. 50, pp. 370-396. Figure 10.2

Content Perspectives on Motivation (cont’d) The Need Hierarchy Approach (Maslow) People must, in a hierarchical order, satisfy five needs: Physiological needs for basic survival and biological function. Security needs for a safe physical and emotional environment. Belongingness needs for love and affection. Esteem needs for positive self-image/self-respect and recognition and respect from others. Self-actualization needs for realizing one’s potential for personal growth and development.

Content Perspectives on Motivation (cont’d) The Need Hierarchy Approach Weaknesses of Maslow’s theory Five levels of need are not always present. Ordering or importance of needs is not always the same. Cultural differences.

Content Perspectives on Motivation (cont’d) The Two-Factor Theory (Herzberg) 1959 People’s satisfaction and dissatisfaction are influenced by two independent sets of factors—motivation factors and hygiene factors. Theory assumes that job satisfaction and job dissatisfaction are on two distinct continuums: Motivational factors (work content) are on a continuum that ranges from satisfaction to no satisfaction. Hygiene factors (work environment) are on a separate continuum that ranges from dissatisfaction to no dissatisfaction.

The Two-Factor Theory of Motivation Satisfaction No satisfaction Motivation Factors • Achievement Recognition The work itself Responsibility Advancement and growth The Two-Factor Theory of Motivation Dissatisfaction No dissatisfaction Hygiene Factors • Supervisors Working conditions Interpersonal relations Pay and security Company policies and administration Figure 10.3

Herzberg's Two-factor Theory Hygiene Factors Motivators Salary, Job Security, Working Conditions, Level and Quality of Supervision, Company Policy and Administration, Interpersonal Relations Nature of Work, Sense of Achievement, Recognition, Responsibility, Personal Growth and Advancement

Content Perspectives on Motivation (cont’d) The Two-Factor Theory (Herzberg) Motivation is a two-stage process: Ensuring that the hygiene factors are not deficient and not blocking motivation. Providing employees the opportunity to experience increase motivational factors through the use of job enrichment and the redesign of jobs. Criticisms of the Two-Factor Theory Interview findings are subject to different explanations. Sample population was not representative. Subsequent research has not upheld theory.

Theory X and Theory Y in the 1960 Theory X and Theory Y are theories of human motivation created and developed by Douglas McGregor at the MIT Sloan School of Management in the 1960s that have been used in human resource management, organizational behavior, organizational communication and organizational development. They describe two contrasting models of workforce motivation. Theory X and Theory Y has to do with the perceptions Managers hold on their employees, not the way they generally behave.

Content Perspectives on Motivation (cont’d) Individual Human Needs (McClelland) The need for achievement The desire to accomplish a goal or task more effectively than in the past. The need for affiliation The desire for human companionship and acceptance. The need for power The desire to be influential in a group and to be in control of one’s environment.

Process Perspectives on Motivation Focus on why people choose certain behavioral options to satisfy their needs and how they evaluate their satisfaction after they have attained their goals. Process Perspectives of Motivation Expectancy Theory Porter-Lawler Extension of Expectancy Theory Equity Theory Goal-Setting Theory

Process Perspectives on Motivation (cont’d) Expectancy Theory Motivation depends on how much we want something and how likely we are to get it. Assumes that: Behavior is determined by a combination of personal and environmental forces. People make decisions about their own behavior in organizations. Different people have different types of needs, desires, and goals. People choose among alternatives of behaviors in selecting one that leads to a desired outcome.

Process Perspectives on Motivation (cont’d) Expectancy Theory (cont’d) Model of Motivation Suggests that motivation leads to effort, when combined with ability and environmental factors, that results in performance which, in turn, leads to various outcomes that have value (valence) to employees. HSBC is seeking a new vice president With a starting salary of 5,00,000 lacks taka per Month. Even though you might want the job, you Will not apply because y you realize that you have little chance of getting it.

Process Perspectives on Motivation (cont’d) The Expectancy Model of Motivation Environment Motivation Effort Performance Ability Outcome Valence Figure 10.4

Process Perspectives on Motivation (cont’d) Elements of Expectancy Theory Effort-to-Performance Expectancy The individual’s perception of the probability that effort will lead to a high level of performance. Performance-to-Outcome Expectancy The individual’s perception of the probability that performance will lead to a specific outcome, or consequence or reward in an organizational setting. Example: if the individual believes that high performance will result in a pay rise, the performance-to-outcome expectancy is high.

Process Perspectives on Motivation (cont’d) Elements of Expectancy Theory (cont’d) Outcomes (Consequences) and Valences Valence is an index of how much an individual values a particular outcome. It is also the attractiveness of the outcome to the individual. Attractive outcomes have positive valences and unattractive outcomes have negative valences. Outcomes to which an individual is indifferent have zero valences.

Process Perspectives on Motivation (cont’d) Elements of Expectancy Theory (cont’d) For individual motivated behavior (effort) to occur: Effort-to-performance expectancy (the belief that effort will lead to high performance) must be greater than zero. Performance-to-outcome expectancy (performance will result in certain outcomes) must be greater than zero. The sum of the valences must be greater than zero—the outcome/reward must have value to the individual .

Process Perspectives on Motivation (cont’d) Porter-Lawler Extension of Expectancy Theory Assumptions: If performance in an organization results in equitable and fair rewards, people will be more satisfied. High performance can lead to rewards and high satisfaction. Types of rewards: Extrinsic rewards—outcomes set and awarded by external parties (e.g., pay and promotions). Intrinsic rewards—outcomes that are internal to the individual (e.g., self-esteem and feelings of accomplishment).

Process Perspectives on Motivation (cont’d) Porter-Lawler Extension of Expectancy Theory Intrinsic rewards (outcomes) Performance Perceived equity Satisfaction Extrinsic Source: Edward E. Lawler III and Lyman W. Porter, “The Effect of Performance on Job Satisfaction,” Industrial Relations, October 1967, p. 23. Used with permission of the University of California. Figure 10.5

Process Perspectives on Motivation (cont’d) Equity Theory People are motivated to seek social equity in the rewards they receive for performance. Equity is an individual’s belief that the treatment he or she receives is fair relative to the treatment received by others. Individuals view the value of rewards (outcomes) and inputs of effort as ratios and make subjective comparisons of themselves to other people. outcomes (self) inputs (self) = outcomes (other) inputs (other)

The Equity Process Source: Van Fleet, David D., and Tim Peterson, Contemporary Management, Third Edition. Copyright © 1994 by Houghton Mifflin Company. Used with permission.

Process Perspectives on Motivation (cont’d) Equity Theory (cont’d) Conditions of and reactions to equity comparisons: Feeling equitably rewarded. Maintain performance and accept comparison as fair estimate. Feeling under-rewarded—try to reduce inequity. Change inputs by trying harder or slacking off. Change outcomes by demanding a raise. Distort the ratios by altering perceptions of self or of others. Leave situation by quitting the job. Change comparisons by choosing another object person.

Process Perspectives on Motivation (cont’d) Equity Theory (cont’d) Conditions of and reactions to equity comparisons: Feeling over-rewarded. Increase or decrease inputs. Distort ratios by rationalizing. Help the object person gain more outcomes.

Process Perspectives on Motivation (cont’d) Goal-Setting Theory Assumptions Behavior is a result of conscious goals and intentions. Setting goals influences the behavior of people in organizations. Characteristics of Goals Goal difficulty Extent to which a goal is challenging and requires effort. People work harder to achieve more difficult goals. Goals should be difficult but attainable.

Process Perspectives on Motivation (cont’d) Characteristics of Goals (cont’d) Goal specificity Clarity and precision of the goal. Goals vary in their ability to be stated specifically. Acceptance The extent to which persons accept a goal as their own. Commitment The extent to which an individual is personally interested in reaching a goal.

Process Perspectives on Motivation (cont’d) The Expanded Goal-Setting Theory of Motivation Goal-Directed Effort Organizational support Performance Satisfaction Extrinsic Rewards Individual abilities and traits Goal commitment Goal difficulty Goal specificity Intrinsic Rewards Goal acceptance Source: Reprinted by permission of the publisher, from Organizational Dynamics, Autumn/1979, copyright © 1979 by American Management Association, New York. All rights reserved. (http://www.amanet.org) Figure 10.6

Reinforcement Perspectives on Motivation Reinforcement Theory The role of rewards as they cause behavior to change or remain the same over time. Assumes that: Behavior that results in rewarding consequences is likely to be repeated, whereas behavior that results in punishing consequences is less likely to be repeated.

Reinforcement Perspectives on Motivation (cont’d) Kinds of Reinforcement in Organizations Positive reinforcement Strengthens behavior with rewards or positive outcomes after a desired behavior is performed. Avoidance Strengthens behavior by avoiding unpleasant consequences that would result if the behavior is not performed.

Reinforcement Perspectives on Motivation (cont’d) Kinds of Reinforcement in Organizations (cont’d) Punishment Weakens undesired behavior by using negative outcomes or unpleasant consequences when the behavior is performed. Extinction Weakens undesired behavior by simply ignoring or not reinforcing that behavior.

Reinforcement Perspectives on Motivation (cont’d) Providing Reinforcement in Organizations Reinforcement schedules Fixed interval schedule—reinforcement applied at fixed time intervals, regardless of behavior. Variable interval—reinforcement applied at variable time intervals. Fixed ratio—reinforcement applied after a fixed number of behaviors, regardless of time. Variable Ratio—reinforcement applied after a variable number of behaviors, regardless of time.

Schedules of Reinforcement in Organizations Source: Van Fleet, David D., and Tim Peterson, Contemporary Management, Third Edition. Copyright © 1994 by Houghton Mifflin Company. Used with permission.

Reinforcement Perspectives on Motivation (cont’d) Providing Reinforcement in Organizations Behavior modification A method for applying the basic elements of reinforcement theory in an organizational setting. Specific behaviors are tied to specific forms of reinforcement.

Popular Motivational Strategies Empowerment and Participation Empowerment The process of enabling workers to set their own work goals, make decisions, and solve problems within their sphere of influence. Participation The process of giving employees a voice in making decisions about their work. Areas of Participation for Employees Making decisions about their jobs. Making decisions about administrative matters. Participating in decision making about broader issues of product quality.

Popular Motivational Strategies (cont’d) New Forms of Working Arrangements Variable Work Schedules Compressed work schedule—Working a full forty-hour week in less than five days. Flexible work schedules (flextime)—Allowing employees to select, within broad parameters, the hours they will work. Job sharing—When two part-time employees share one full-time job.

Popular Motivational Strategies (cont’d) New Forms of Working Arrangements (cont’d) Variable Work Schedules Telecommuting—Allowing employees to spend part of their time working off-site, usually at home, by using e-mail, the Internet, and other forms of information technology.

Using Reward Systems to Motivate Performance Effects of Organizational Rewards Effect of Rewards on Attitudes Satisfaction is influenced by how much is received and how much the person thinks should have been received. Satisfaction is affected by comparison with others. The rewards of others are often misperceived. Overall job satisfaction is affected by employee satisfaction with intrinsic and extrinsic rewards.

Using Reward Systems to Motivate Performance (cont’d) Effects of Organizational Rewards (cont’d) Effect of Rewards on Behaviors Extrinsic rewards affect employee satisfaction and reduce turnover. Rewards influence patterns of attendance and absenteeism. Employees tend to work harder for rewards based on performance.

Using Reward Systems to Motivate Performance (cont’d) Effects of Organizational Rewards (cont’d) Effect of Rewards on Motivation Employees will work harder when performance will be measured. Employees will work harder if performance is closely followed by rewards.

Using Reward Systems to Motivate Performance (cont’d) Designing Effective Reward Systems Reward system must meet an individual’s needs. Rewards should compare favorably with other organizations. Distribution of rewards must be perceived to be equitable. Reward system must recognize different needs.

Using Reward Systems to Motivate Performance (cont’d) Popular Approaches to Rewarding Employees Traditional systems Fixed hourly or monthly rate or an incentive system. Merit systems Employees get different pay raises at the end of the year depending on their overall job performance. Incentive systems Employees get different pay amounts at each pay period in proportion to what they do (e.g., piece-rate pay plans).

Using Reward Systems to Motivate Performance (cont’d) Popular Approaches to Rewarding Employees (cont’d) Profit sharing plans Provides an annual bonus based to corporate profits. Gainsharing All group members get bonuses when performance targets are exceeded. Lump sum bonuses One-time reward, not an increase in base salary. Pay-for-knowledge Pay the individual rather than the job.