1 Topics in Applied Motivation: Rewards and Job Design OS 386 October 3, 2002 Fisher

2 Agenda Hand back case studies Rewards – Purpose of rewards – Types of rewards Job design – Design vs. redesign – Techniques of job design

3 Case Study Results Class average: 16 Common errors – Relying on opinion, not backing up with class concepts – Failure to answer all the questions Issues with format

4 Why do organizations reward employees? Basic compensation – You do work, they give you money Beyond that, what are they hoping for? As we discuss rewards, keep in mind – Learning theories (e.g., behavior modification) – Motivational theories

5 Types of Rewards Membership Seniority Job status Competencies Performance

6 Organizational Membership You receive certain rewards (benefits) just for being an employee – Health insurance – Transportation – Special services at some companies including dry cleaning, food preparation, concierge Behaviors encouraged or discouraged?

7 Seniority Rewards are allocated based on length of time with the organization Greater seniority leads to – Increase in pay rate – More vacation – Access to better jobs Common in unionized workplaces Behaviors encouraged or discouraged?

8 Job status Rewards (e.g., pay, workspace, parking) allocated based on job requirements – Level of responsibility – Number of people managed – Degree or skills required – Market for certain jobs (e.g., programmer) Behaviors encouraged or discouraged?

9 Competencies Rewards allocated based on individual capabilities – If you have more, you get more pay – Started in manufacturing jobs Designed to increase organizational flexibility Can be cumbersome to administer – How do you know who has the competencies? Behaviors encouraged or discouraged?

10 Performance Rewards allocated on basis of performance Can be at organization, team, or individual level – Challenging in team contexts Works best when clear, objective criteria can be established – Profit, sales, production, safety Behaviors encouraged or discouraged?

11 Conclusions on rewards Must be in line with what organization is trying to achieve You are likely to see the behaviors you reward Careful of unintended consequences – Delivering pizza within 30 minutes – Next year’s budget is based on how much you spend this year – Paying insurance claims quickly and with few customer complaints

12 Job Design Allocating duties and responsibilities to jobs or job groupings Motivation is only part of the story – Must also consider efficiency, customer reactions, other factors Easier to design new jobs than redesign existing jobs

13 Job Characteristics Model Individualdifferences WorkmotivationGrowthsatisfactionGeneralsatisfactionWorkeffectiveness Feedback from job Knowledge of results Skill variety Task identity Task significance Meaningfulness AutonomyResponsibility CriticalPsychologicalStates Core Job CharacteristicsOutcomes Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

14 Specialization Job enlargement Job enrichment Job rotation Common Techniques

15 Job Specialization Advantages – More efficient – Lower training costs – People learn jobs more quickly – Better person/job matching Disadvantages – Less flexibility – Boredom with some employees

16 Job Enrichment Strategies Empowering employees – giving employees more autonomy – feeling of control and self-efficacy Forming natural work units – completing an entire task – assigning employees to specific clients Establishing client relationships – employees put in direct contact with clients

17 Job Rotation Rotating people periodically from job to job Reduces boredom, increases flexibility Helps minimize repetitive strain injuries Can have some process loss

18 Obstacles to job redesign Resistance to change – Skilled workers – Labor unions – Supervisors Hard to find optimal levels of enrichment and specialization – Must deal with differences across people

19 For next class Topic: Stress – Read chapter 7 Start thinking about first exam – October 10 – Multiple choice (30) and short essay (2 of 3)