1. People in Business Developing and Retaining an Effective Workforce: Motivating Employees
‘Alone we can do so little; together we can do so much’
Helen Keller
‘The only worthwhile activities of man are those which are socially useful’
Alfred Adler
‘I can’t believe that God put us on this earth to be ordinary’
Lou Holtz
‘Ability is nothing without opportunity’
Napoleon Bonaparte
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2. Using financial methods to motivate employees Improving job design
Developing and Retaining an Effective Workforce: Motivating Employees In this topic you will learn about:
Using financial methods to motivate employees
Improving job design
Empowering employees
Working in teams
Theories of motivation
The master of motivation:
David Brent Video Clip – please watch to consider appropriateness and if you feel unsuitable delete
You will need access to the internet to watch this video clip
2.7 Motivating Employees

3. Using financial methods to motivate employees
Time based pay – wages (quoted hourly and paid weekly) and salaries (quoted annually and paid monthly)
Piece rate – payment based on the number of items (pieces) produced
Commission – payment based on the number of units sold
Performance related pay (PRP) – a bonus based on the performance of the employee measured against a range of criteria
Profit related pay – a proportion of employee pay varies with the profits of the company
Employee share ownership programme (ESOP) – a scheme allowing employees to buy shares within a plc
Fringe benefits – non-financial benefits that have a cash value e.g. company car, private health care
A bumper bonus at John Lewis:
You will need access to the internet to watch this video clip
2.7 Motivating Employees

4. Improving job design - non-financial methods to motivate employees
Job enrichment –an increase in the level of responsibility that an employee has in order to increase motivation
Job enlargement – an increase in the number (as opposed to level) of responsibilities that an employee has in order to increase motivation
Job rotation – varying the tasks that an employee does to reduce boredom and increase the range of skills that the worker has (multi tasking) B
Individually, choose one type of job.
For each of the above give an example that applies to that job.
2.7 Motivating Employees

5. Empowering employees
Empowerment – delegating responsibility to employees, allowing them to use their abilities and to have a greater say in the decision-making process of the company
Do any of you have responsibilities within the school or college?
What are the benefits and disadvantages of empowering responsibilities
in the Sixth Form?
2.7 Motivating Employees

6. Empowering employees - the link between organisational structure and motivational techniques available to managers
The organisational structure has a significant bearing on the methods of motivation available to managers:
Functional – organisation by department e.g. marketing or accounts. Most financial and non-financial methods of motivation can be used although it would be difficult to use piece rate and commission in departments where nothing is produced or sold
Operational – divisional organisation within a company e.g. by product. This allows the division to embrace team work and instil a sense of belonging into the division. The team will work for each other and profit related pay will act as a large incentive for the division.
Matrix – this cuts across departments and incorporates employees with a range of skills. This can be very empowering for the individual, allowing them to use their abilities.
2.7 Motivating Employees

7. Working in teams
Team working - where employees are organised into groups and work together in order to meet set objectives
Working in groups(!) identify a team that you have been a part of.
In what ways has it helped you as an individual and in what ways has the
team as a whole benefited?
Why is it not always easy to work as a team?
What makes a good team?
What are the advantages of team work?
You will need access to the internet to watch this video clip. This clip is 50 minutes and maybe better set as a homework or private study activity.
2.7 Motivating Employees

8. Theories of motivation
Motivation looks at the reasons why people behave in the manner that they do. Traditionally, the AQA has looked at four main theorists – business gurus who have shaped thinking on motivation in the work place:
Taylor
Mayo
Maslow
Hertzberg
2.7 Motivating Employees

9. Theories of motivation
Frederick Winslow Taylor (1856 – 1915)
American Taylor is seen as the father of ‘Scientific Management’. He believed that all tasks should be studied scientifically and that each employee should be trained and instructed in exactly how to do a job in the most efficient manner. There should then be supervision of the worker and the output produced.
Taylor believed that workers were not capable of understanding their tasks and should follow strict rules on how to produce products. His ideas are linked to ‘piece rate’, the ‘division of labour’ and ‘mass production’. He is criticised for making jobs tedious – as can be seen in today’s assembly lines and fast food restaurants.
Watch Taylorism in action:
You will need access to the internet to watch this video clip
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10. Theories of motivation
George Elton Mayo (1880 – 1949)
Australian Mayo believed that workers must be seen as members of a group not as individuals. His work looked at the importance of human relations in the workplace. 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. In his ‘Hawthorne experiments’ he looked at the power of informal (as opposed to formal) groups as a basis for production in the workplace.
List five formal groups that you belong to.
Who set these groups up and what is their purpose?
Now think of an informal group that you belong to.
Who leads these groups and what is the purpose of the group?
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11. Theories of motivation
Abraham Harold Maslow
(1908 – 1970)
American Maslow is famed for his ‘Hierarchy of Needs’. In this he saw human needs arranged in order:
1 Physical needs – food, drink, sleep, sex, air
2 Safety needs – job, house, family, health,
3 Psychological needs – love, friendship, belonging
4 Esteem needs – achievement, confidence, respect
5 Self-actualisation – self-fulfilment
i.e. a feeling that one has fulfilled their potential from a moral, spiritual and creative viewpoint.
Maslow believed that each need must be fulfilled before one could move on to the next. His work has influenced business thinking in areas such as social needs and empowerment.
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12. Theories of motivation
In small groups look at each level
of Maslow’s Hierarchy of Needs.
For each level discuss what needs each
level of the group has already achieved
and in what specific ways each member
of the group believes that they will go on
to achieve in the future.
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13. Theories of motivation
Frederick Irving Herzberg (1923 – 2000)
American Herzberg introduced the notion of job enrichment. In 1959 he proposed the ‘Two factor theory’ of job satisfaction. He believed that job satisfaction could be influenced positively and negatively:
Satisfaction – this occurs because of motivator factors – achievement, recognition, work, responsibility, promotion and growth.
Dissatisfaction – this occurs because of hygiene factors - pay in the workplace, and benefits, company policy, relationships in the workplace, work conditions, status and job security. If these are absent they can cause dissatisfaction. However, the presence of hygiene factors does not create satisfaction.
Watch Herzberg discussing his theories – Parts One and Two:
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You will need access to the internet to watch this video clip

14. Activity – Motivation theory
Look at all of the financial and non-financial methods of motivation discussed in this unit. Which methods should be used to motivate students to pass their AS exams? Justify your answers.
Now look at the four motivation theorists that we have looked at. Take each theorist individually and say how each theory might be used to explain the actions of students at your centre. Do you agree that these theories are useful in explaining how students might be motivated? Justify your answer.
2.7 Motivating Employees