Adeyl Khan, Faculty, BBA, NSU Chapter 5, 6, 7

Adeyl Khan, Faculty, BBA, NSU

What does employee want!  Work  Whenever you want  Wherever you like  Follow your favorite band around!  Watch movies on a workday!  Go home at times when there are less traffic 3 Is this a way to run business?

Adeyl Khan, Faculty, BBA, NSU A real-life example  Set own schedule  No meetings (Subject to PE)  Result  Voluntary turnover decreased  Productivity Increase 4 40% IBM Employee W/O a formal office 40% IBM Employee W/O a formal office SUN employees work anywhere 33% AT&T Managers W/O dedicated workplace

Adeyl Khan, Faculty, BBA, NSU Job Characteristics Model  Identifies five job characteristics and their relationship to personal and work outcomes. Skill variety Task identity Task significance AutonomyFeedback Motivating by Job Design

Adeyl Khan, Faculty, BBA, NSU Skill Variety  The degree to which a job requires a variety of different activities (how may different skills are used in a given day, week, month?).  High variety  The owner-operator of a garage who does electrical repair, rebuilds engines, does body work, and interacts with customers  Low variety  A body-shop worker who sprays paint eight hours a day

Adeyl Khan, Faculty, BBA, NSU Task Identity  The degree to which the job requires completion of a whole and identifiable piece of work (from beginning to end). High A cabinetmaker who designs a piece of furniture, selects the wood, builds the object, and finishes it to perfection Low A worker in a furniture factory who operates a lathe to make table legs

Adeyl Khan, Faculty, BBA, NSU Task Significance  The degree to which the job has a substantial impact on the lives or work of other people High Nursing the sick in a hospital intensive care unit Low Sweeping hospital floors

Adeyl Khan, Faculty, BBA, NSU Autonomy  The degree to which the job provides substantial freedom and discretion to the individual in scheduling the work and in determining the procedures to be used in carrying it out. High A telephone installer who schedules his or her own work for the day, and decides on the best techniques for a particular installation Low A telephone operator who must handle calls as they come according to a routine, highly specified procedure

Adeyl Khan, Faculty, BBA, NSU Feedback  The degree to which carrying out the work activities required by a job results in the individual obtaining direct and clear information about the effectiveness of his or her performance. High An electronics factory worker who assembles a radio and then tests it to determine if it operates properly Low An electronics factory worker who assembles a radio and then routes it to a quality control inspector who tests and adjusts it

Adeyl Khan, Faculty, BBA, NSU Jobs with skill variety, task identity, task significance, autonomy, and for which feedback of results is given, directly affect three psychological states of employees:  Meaningfulness of work  Personal feelings of responsibility for results  Knowledge of results Job Characteristics Model Motivation, Performance Job Satisfaction Absence Turnover Controls …

Adeyl Khan, Faculty, BBA, NSU The Job Characteristics Model Source: J.R. Hackman and G.R. Oldham, Work Design (excerpted from pp. 78–80). © 1980 by Addison-Wesley Publishing Co., Inc. Reprinted by permission of Addison-Wesley Longman, Inc. Moderating Variable

Adeyl Khan, Faculty, BBA, NSU Job dimensions operate through the psychological states in influencing personal and work outcome variables rather than influencing them directly. 13 Moderating variables>> Individuals growth needs >> Desire of self esteem, self actualization

Adeyl Khan, Faculty, BBA, NSU 14

Adeyl Khan, Faculty, BBA, NSU MPS Index  The five core job characteristics can be combined to form a motivating potential score (MPS) for a job, which can be used as an index of how likely a job is to affect an employee's attitudes and behaviors  MPS= (Sv + Ti + Ts)/3 x Autonomy x Feedback 15

Adeyl Khan, Faculty, BBA, NSU Improving Jobs to reflect Corporate Goal Motivation,Performance Job Satisfaction AbsenceTurnover 16

Adeyl Khan, Faculty, BBA, NSU Job (Re)design and scheduling  Job Rotation/cross training  The periodic shifting of a worker from one task to another (challenging task).  Skills, knowledge, scheduling, training cost, productivity, disruptions  Job Enlargement (horizontal expansion)  Change job  Housekeeping employees Brain turning pudding!

Adeyl Khan, Faculty, BBA, NSU Job (Re)design and scheduling  Job Enrichment  The vertical expansion of jobs  Increases Planning, execution, and evaluation Satisfaction Absenteeism Turn-over Freedom/Independence + Responsibility + Feedback = Performance

Adeyl Khan, Faculty, BBA, NSU Guidelines for Enriching a Job Bank One- Training, Productivity, Satisfaction, Bottom Line Bank One- Training, Productivity, Satisfaction, Bottom Line

Adeyl Khan, Faculty, BBA, NSU Alternative Work Arrangements  Flextime  Job Sharing  Telecommuting Redesign jobs Involving in Decision Making Motivating Work Environment

Adeyl Khan, Faculty, BBA, NSU Flextime Schedule  Employees work during a common core time period each day but have discretion in forming their total workday from a flexible set of hours outside the core. Choton is a morning person

Adeyl Khan, Faculty, BBA, NSU Job Sharing  The practice of having two or more people split a 40- hour-a-week job.  Issues  Finding the right partner  Promotion  Bonuses  Advantages  More Heads!  Skilled labor (Moms)  Humanitarian 22

Adeyl Khan, Faculty, BBA, NSU Telecommuting Larger labor pool Higher productivity Less turnover Improved morale Reduced office-space costs Traffic, dress, interruptions …. Advantages Less direct supervision of employees Difficult to coordinate teamwork Difficult to evaluate non-quantitative performance Disadvantages (Employer)

Adeyl Khan, Faculty, BBA, NSU Telecommuting  Employees do their work at home on a computer that is linked to their office.  Categories of telecommuting jobs:  Routine information handling tasks  Mobile activities  Professional and other knowledge- related tasks

Adeyl Khan, Faculty, BBA, NSU Performance = f(A x M x O) Rohini Vs. Anwar Gifted Vs. Hardworking Work Environment Vs. Capability

Adeyl Khan, Faculty, BBA, NSU Employee Involvement  A participative process that uses the input of employees and is intended to increase employee commitment to the organization’s success.  Participative Management Vs. Job Design

Adeyl Khan, Faculty, BBA, NSU E.I. Programs Participative Management A process in which subordinates share a significant amount of decision making power with immediate superior. Relevant Issues, trust/confidence Competence, knowledge Representative Participation Workers participate in organizational decision making through a small group of representative employees. Management, Stockholders … Motivation: Individual Vs. Group Quality Circle A work group of employees who meet regularly to discuss their quality problems, investigate causes, recommend solutions, and take corrective actions people Employee satisfaction ? Productivity ?

Adeyl Khan, Faculty, BBA, NSU EI Programs and Motivation Theories Employee Involvement Programs Theory Y (Believing employees want to be involved) Two-Factor Theory ( Intrinsic Motivation) Hierarchy of needs ( Employee Needs) ERG ( Employee Needs) PhysiologicalSafetySocialEsteem Self- actualization

Adeyl Khan, Faculty, BBA, NSU Rewarding Employees Four Aspects  What to Pay  How to Pay  What Benefits to Offer  How to Recognize Employees Xers Nexters 2000+

Adeyl Khan, Faculty, BBA, NSU What to Pay  Internal equity  Worth of job to organization  External equity  Worth in the industry (Competitiveness)  Do a job survey  Pay leaders above the market rate  Fortune 500 CEOs 30 Rewarding employees

Adeyl Khan, Faculty, BBA, NSU Variable Pay Programs  A portion of an employee’s pay is based on some individual and/or organization measure of performance.  Piece rate pay plans  Profit sharing plans  Gain sharing plans Rewarding employees Elementary school-teacher  Seniority Vs. Performance Elementary school-teacher  Seniority Vs. Performance

Adeyl Khan, Faculty, BBA, NSU Variable Pay Programs …  Piece-rate Pay Plans (Output)  Workers are paid a fixed sum for each unit of production completed.  Example: Sweater Industry- No base rate!  How to pay a cricket team  Merit based pay (Performance)  Based on Performance Appraisals rating  Pay α Performance  Pay increase based on PA, Ambiguity  Economic condition (Pay raise pool) !  Unions resist

Adeyl Khan, Faculty, BBA, NSU Bonuses  Rewards employees on recent performance compared to historical performance  Fortune 100 CEOs, Bonus Mean of $1 Mil  Bonuses Vs. Small Merit pay increase  Combinations! Rewarding employees

Adeyl Khan, Faculty, BBA, NSU Skill-Based Pay Plans  Pay levels are based on how many skills employees have or how many jobs they can do.  Benefits of Skill-based Pay Plans:  Provides staffing flexibility.  Facilitates communication across the organization.  Lessens “protection of territory” behaviors.  Meets the needs of employees for advancement (without promotion).  Leads to performance improvements.

Adeyl Khan, Faculty, BBA, NSU Skill-Based Pay Plans (cont’d)  Drawbacks  Lack of additional learning opportunities that will increase employee pay.  Continuing to pay employees for skills that have become obsolete.  Paying for skills which are of no immediate use to the organization.  Paying for a skill, not for the level of employee performance for the particular skill.

Adeyl Khan, Faculty, BBA, NSU Linking Skill-based Plans and Motivation Theories Skill Based Pay Plans Reinforcement Theory Equity Theory (Comparison) Equity ERG Theory (Growth) McClelland’s Need for Achievement Hierarchy of needs ( Self Actualization)

Adeyl Khan, Faculty, BBA, NSU 37 PhysiologicalSafetySocialEsteem Self- actualization AchievementAffiliationPower Hierarchy of needs ( Self Actualization) McClelland’s Need for Achievement

Adeyl Khan, Faculty, BBA, NSU Variable Pay Programs (cont’d)  Profit-Sharing Plans  Organization wide programs that distribute compensation based on some established formula designed around a company’s profitability.  Gain Sharing (Productivity Gain Vs. Profit)  An incentive plan in which improvements in group productivity determine the total amount of money that is allocated.  Employee Stock Ownership Plan (ESOPs)  Below market rate- increase employee satisfaction  Job satisfaction and work motivation depends on “Psychologically experience ownership”

Adeyl Khan, Faculty, BBA, NSU Flexible Benefits  Employees tailor their benefit program to meet their personal need by picking and choosing from a menu of benefit options.  Core-Plus Plans: a core of essential benefits and a menu-like selection of other benefit options.  Modular Plans: predesigned benefits packages for specific groups of employees.  Flexible Spending Plans: allow employees to use their tax-free benefit dollars to purchase benefits and pay service premiums. Linking reward to individuals goals  Change in demographic Linking reward to individuals goals  Change in demographic

Adeyl Khan, Faculty, BBA, NSU Expectancy Theory

Adeyl Khan, Faculty, BBA, NSU  At Super Club, a large warehouse store, the employees strive to obtain the "Employee of the Month" award with the benefits of having their picture featured on the wall of fame in the staff lounge. … 41

Adeyl Khan, Faculty, BBA, NSU Employee Recognition Programs  Intrinsic rewards: stimulate intrinsic motivation  Personal attention given to employee  Approval & appreciation for a job well done  Growing in popularity and usage  Benefits of programs  Fulfill employees’ desire for recognition  Inexpensive to implement  Encourages repetition of desired behaviors  Drawbacks of programs  Susceptible to manipulation by management Long Term Motivation

Adeyl Khan, Faculty, BBA, NSU Gift certificates & cash reward

Adeyl Khan, Faculty, BBA, NSU

Implications for Managers  In Order to Motivate Employees  Recognize individual differences.  Use goals and feedback.  Allow employees to participate in decisions that affect them.  Link rewards to performance.  Check the system for equity.