1. Managing Employee Motivation and Performance
CHAPTER 16
Managing Employee Motivation and Performance
PowerPoint Presentation by Charlie Cook
Copyright © by Houghton Mifflin Company. All rights reserved.

2. 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.

3. Chapter Outline The Nature of Motivation
The Importance of Motivation in the Workplace
Historical Perspectives on 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
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

4. 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 to do the job.

5. 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 16.1

6. Historical Perspectives on Motivation
The Traditional Approach
Frederick Taylor (Scientific Management)
Assumptions:
Managers know more than workers.
Economic gain (money) is the primary motivation for performance.
Work is inherently unpleasant.
The Human Relations Approach
Emphasized the role of social processes in the workplace.
Employees want to feel useful and and important.
Employees have strong social needs, more important than money.
Maintaining the appearance of employee participation is important.

7. Historical Perspectives on Motivation (cont’d)
The Human Resource Approach
Assumptions:
Employee contributions are important and valuable to the employee and the organization.
Employees want to and are able to make genuine contributions.
Management’s job is to encourage participation and create a work environment that motivates employees.

8. Content Perspectives on Motivation
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
Aldefer’s ERG Theory
Herzberg’s Two-Factor Theory
McClelland’s Achievement, Power, and Affiliation Needs

9. Content Perspectives on Motivation (cont’d)
The Need Hierarchy Approach
Maslow’s Hierarchy of Needs
People must, in a hierarchical order, satisfy five groups of 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.
Weakness of Maslow’s theory
Five levels of need are not always present.
Ordering or importance of needs is not always the same.
Cultural differences.

10. Maslow’s Hierarchy of Needs
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
Figure 16.2

11. Content Perspectives on Motivation (cont’d)
The ERG Theory (Alderfer)
People’s needs are grouped into three overlapping categories—existence, relatedness, and growth.
Maslow’s hierarchy is collapsed into three levels:
Existence needs related to physiological and security needs.
Relatedness needs that are similar to belongingness and esteem by others.
Growth needs encompass needs for self-esteem and self-actualization.
ERG theory assumes that:
Multiple needs can be operative at one time (there is no absolute hierarchy of needs).
If a need is unsatisfied, a person will regress to a lower-level need and pursue that need (frustration-regression).

12. Content Perspectives on Motivation (cont’d)
The Two-Factor Theory (Herzberg)
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.
Motivation is a two-step process:
Ensuring that the hygiene factors are not deficient and not blocking motivation.
Giving employees the opportunity to experience motivational factors through job enrichment.

13. 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 16.3

14. 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.

15. Process Perspectives on Motivation
Approaches to motivation that 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

16. 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 that leads to a desired outcome.
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.

17. Process Perspectives on Motivation (cont’d)
Elements of Expectancy Theory
Effort-to-Performance Expectancy
The employee’s perception of the probability that effort will lead to a high level of performance.
Performance-to-Outcome Expectancy
The employee’s perception of the probability that performance will lead to a specific outcome—the consequence or reward for behaviors in an organizational setting.

18. Process Perspectives on Motivation (cont’d)
Elements of Expectancy Theory (cont’d)
Valence
An index of how much an individual values a particular outcome.
It is 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.
For motivated behavior to occur:
Both effort-to-performance expectancy and performance-to-outcome expectancy probabilities must be greater than zero.
The sum of the valences must be greater than zero.

19. Process Perspectives on Motivation (cont’d)
The Expectancy Model of Motivation
Environment
Motivation
Effort
Performance
Ability
Outcome
Valence
Figure 16.4

20. Process Perspectives on Motivation (cont’d)
The 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 are outcomes set and awarded by external parties (e.g., pay and promotions).
Intrinsic rewards are outcomes that are internal to the individual (e.g., self-esteem and feelings of accomplishment).

21. Process Perspectives on Motivation (cont’d)
The Porter-Lawler Extension of Expectancy Theory
Intrinsic
rewards
(outcomes)
Performance
Perceived
equity
Satisfaction
Extrinsic
Figure 16.5

22. 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)

23. 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.
Feeling over-rewarded.
Increase or decrease inputs.
Distort ratios by rationalizing.
Help the object person gain more outcomes.

24. Process Perspectives on Motivation (cont’d)
Goal-Setting Theory
Assumptions
Behavior is a result of conscious goals and intentions.
Setting goals influence 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.
Goal specificity
Clarity and precision of the goal.
Goals vary in their ability to be stated specifically.

25. Process Perspectives on Motivation(cont’d)
Characteristics of Goals (cont’d)
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.

26. 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, copyright © 1979 by American Management Association, New York. All rights reserved. (
Figure 16.6

27. 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.

28. 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.
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.

29. 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.
Behavior modification (OB mod)
A method for applying the basic elements of reinforcement theory in an organizational setting.
Specific behaviors are tied to specific forms of reinforcement.

30. 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.
Decisions about administrative matters (e.g., work schedules).
Participating in decision making about broader issues of product quality.

31. Popular Motivational Strategies (cont’d)
Techniques and Issues in Empowerment
Using work teams
Collections of employees empowered to plan, organize, direct, and control their work.
Changing the overall method of organizing the firm by becoming more decentralized.
Conditions necessary for empowerment:
Organization must be sincere about spreading power to lower levels.
Organization must be committed to empowering workers.
Organization must be systematic and patient in its efforts to empower workers.
Organization must be prepared to increase its commitment to training.

32. 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.
Telecommuting—Allowing employees to spend part of their time working off-site, usually at home, by using , the Internet, and other forms of information technology.

33. Using Reward Systems to Motivate Performance
The formal and informal mechanisms by which employee performance is defined, evaluated, and rewarded.
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.

34. 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.
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.

35. Using Reward Systems to Motivate Performance (cont’d)
Designing Effective Reward (cont’d)
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.
New Approaches
Merit system
A reward system whereby people get different pay raises at the end of the year depending on their overall job performance.
Incentive system
A reward system whereby people get different pay amounts at each pay period in proportion to what they do.