1. 1.4 Managing people 1.4.4 Motivation in theory and practice
Theme 1:
Marketing and people
What motivates you at school or college?
Is this the same as what motivates you at work?
What will you look for in your future career to provide motivation?
1.4 Managing people Motivation in theory and practice
Edexcel Business

2. 1.4.4 Motivation in theory and practice
In this topic you will learn about
The importance of employee motivation to a business
Motivation theories:
Taylor (scientific management)
Mayo (human relations theory)
Maslow (hierarchy of needs)
Herzberg (two factor theory)
Financial incentives to improve employee performance:
piecework
commission
bonus
profit share
performance-related pay
Non-financial techniques to improve employee performance:
delegation
consultation
empowerment
team working
flexible working
job enrichment
job rotation
job enlargement

3. Employee motivation
Motivation is the factors influencing the way people behave
Financial incentives
Non-financial incentives
Individual character
Desire to achieve a goal
Motivated employees will be engaged employees
Engaged employees are those who are fully committed to their role and strive to help the business achieve its objectives

4. Employee motivation Benefits: Higher labour productivity
Lower labour turnover
Higher retention rates
Lower unit costs
Lower absenteeism
Improved customer service
Better workplace relations
How would you keep workers happy?
From heart rates to surveys: How to keep workers happy

5. Motivation theories Theories of motivation include:
Taylor’s scientific management
Mayo’s human relations theory
Maslow’s hierarchy of needs
Herzberg’s two factor theory
Each theory attempts to explain the key influences on human behaviours
Why is it difficult to explain what motivates employees in the workplace?

6. Frederick Winslow Taylor (1856 – 1915)
American Taylor is seen as the father of ‘Scientific Management’.
Taylor believed that workers were not capable of understanding their tasks and should follow strict rules on how to produce products
All tasks should be studied scientifically using a study of time and motion
The most efficient way of carrying out a task will hence be identified
Each employee can then be trained and instructed in exactly how to do a job in the most efficient manner
Workers should be closely supervised
He coined the term economic man believing money is the key to motivation
His ideas are linked to piece rate, the division of labour and mass production
He is criticised for making jobs tedious
Write a definition for each of the terms shown in purple.
Ford and Taylor Scientific Management (Edited)

7. George Elton Mayo (1880 – 1949)
Believed that workers must be seen as members of a group not as individuals
He emphasised the informal work group as the means to improving productivity
He believed that workers had ‘social needs’ and that these should take precedence over other areas such as money as a motivator
Changes in working conditions and financial incentives have little impact on labour productivity
In his ‘Hawthorne experiments’ he looked at the power of informal, as opposed to formal, groups as a basis for production in the workplace
His findings were that motivation can be improved by:
Consultation
Paying an interest in workers
Team work
Some degree of autonomy in one’s working day e.g. break times
Australian Mayo looked at the importance of human relations in the workplace.

8. Abraham Harold Maslow (1908 – 1970)
Maslow’s hierarchy of needs is based on seeing human needs as being placed in order, each need must be fulfilled before one could move on to the next
Employees can be motivated by being presented with the opportunity to achieve the next level
American Maslow belongs to the Neo-Human relations school of management. He is well known for his hierarchy of needs.
Higher order needs
Lower order needs

9. Frederick Irving Herzberg (1923 – 2000)
American Herzberg introduced the notion of job enrichment. In 1959 he proposed the ‘Two factor theory’ of job satisfaction.
Job satisfaction is a key factor leading to motivation
Job satisfaction could be influenced both positively and negatively
Motivating factors
Hygiene factors
if present, lead to job satisfaction and hence motivation
achievement, recognition, work, responsibility, promotion and growth
if present do not lead to motivation but if absent lead to dissatisfaction
pay and benefits, company policy, workplace relationships, work conditions, status and job security
Jumping for the Jelly Beans (1 of 2) & (2 of 2)
Jumping for the Jelly Beans.

10. In pairs Select one business or industry
Identify a range of jobs within that business or industry
Explain what motivates employees in each of the jobs with reference to the 4 motivational theorists
How useful do you think motivational theories are in understanding workplace behaviour?

11. Test yourself - 4 minutes
Explain Taylor’s theory of scientific management.
Underline or highlight each business term used in your explanation.
End

12. Test yourself - 4 minutes
Explain Herzberg’s two factor theory.
Underline or highlight each business term used in your explanation.
End

13. Test yourself - 4 minutes
Explain Maslow’s hierarchy of needs.
Underline or highlight each business term used in your explanation.
End

14. Test yourself - 4 minutes
Explain Mayo’s human relations theory.
Underline or highlight each business term used in your explanation.
End

15. Financial incentives to improve employee motivation
Financial incentives are the variety of methods that have a money value and are used to reward the workforce and influence their behaviours at work
Non-financial incentives are the methods of motivating employees through elements of job design
Zappos: a case study.
Does money really motivate people?
Does money really motivate people?

16. financial methods of motivation
Financial methods of motivation include:
Piece rate is when payment is based on the number of items (pieces) produced by an employee
Commission is when payment is based on the number of units sold
Bonus is an additional, lump sum, one off payment to an employee for meeting individual, team or company targets
Profit share is when a proportion of employee pay varies with the profits of the company
Performance related pay (PRP) is when employees receive a bonus based on the performance of the employee measured against a pre agreed range of criteria
Which motivational theorist would be in favour of piece rate pay as a financial motivator?
BBC
John Lewis' bumper profits
The John Lewis Partnership has reported a huge increase in profits, with staff in line for a bumper bonus
Which financial method would motivate you?
Could these be applied to sixth form studies?

17. Non-financial techniques to improve employee performance
Delegation involves the passing of authority down the hierarchy
Responsibility remains with the manager
This will:
free up time for management
motivate workers by providing them job enrichment
may mean that decisions are being made closer to the grass roots
How easy is it to delegate?
Are there any risks associated with delegation??

18. Non-financial techniques to improve employee performance
Discuss how each of these techniques could improve motivation.
Consultation
Empowering
Team working
Flexible working

19. Non-financial techniques to improve employee performance
Job enrichment
Job rotation
Job enlargement
What would be the most effective way of attracting doctors into general practice?
GP incentives 'not the answer' to recruitment, experts say

20. Test yourself - 4 minutes
With the use of examples distinguish between financial and non-financial incentives.
End

21. In pairs – draw the grid below onto A3 paper and complete where appropriate to explain the links between the motivational techniques and theories.
Taylor
Mayo
Maslow
Herzberg
Financial incentives
Delegation
Consultation
Empowerment
Team working
Flexible working
Job enrichment, rotation and enlargement

22. 1.4.4 Motivation in theory and practice
In this topic you have learnt about
The importance of employee motivation to a business
Motivation theories:
Taylor (scientific management)
Mayo (human relations theory)
Maslow (hierarchy of needs)
Herzberg (two factor theory)
Financial incentives to improve employee performance:
piecework
commission
bonus
profit share
performance-related pay
Non-financial techniques to improve employee performance:
delegation
consultation
empowerment
team working
flexible working
job enrichment
job rotation
job enlargement