1. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.1 Challenges of Motivating Employees  Changing workforce  Younger employees have different needs  Diverse workforce  Layoffs, restructuring  Damaged trust, commitment  Flatter organizations  Fewer supervisors to monitor performance

2. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.2 Needs Hierarchy Theory Self- Actualization Esteem Belongingness Safety Physiological  Maslow arranged five needs in a hierarchy  Satisfaction-progression process  People who experience self- actualization desire more rather than less of this need  Not much support for Maslow’s theory

3. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.3 ERG Theory Needs Hierarchy Theory ERG Theory Growth Relatedness Existence  Alderfer’s model has three sets of needs  Adds frustration- regression process to Maslow’s model  Somewhat more research support than Maslow’s theory Self- Actualization Esteem Belongingness Safety Physiological

4. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.4 Innate Drives Theory Drive to Bond Drive to Learn Need to form relationships and social commitments Basis of social identity Need to satisfy curiosity and resolve conflicting information Basis of self-actualization Drive to Defend Need to protect ourselves A reactive (not proactive) drive Basis of fight or flight Drive to Acquire Need to take/keep objects and experiences Basis of hierarchy and status

5. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.5 Innate Drives and Motivation  Emotional brain centre relies on innate drives to assign emotional markers to incoming information  Emotional markers influence rational thoughts and become the conscious sources of motivation

6. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.6 Learned Needs Theory Some needs are learned, not innate  Need for achievement  desire for challenging and somewhat risky goals, feedback, recognition  Need for affiliation  desire to seek approval, conform, and avoid conflict  try to project a favourable self-image  Need for power  desire to control one’s environment  personalized versus socialized power

7. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.7 Implications of Needs-based Theories  Organizations need to support employees to achieve a balance of their innate needs  People have different needs at different times  Offer employees a choice of rewards  Do not rely too heavily on financial rewards

8. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.8 E-to-P Expectancy P-to-O Expectancy Outcomes & Valences Outcome 1 + or - EffortPerformance Outcome 3 + or - Outcome 2 + or - Expectancy Theory of Motivation

9. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.9 Expectancy Theory in Practice  Increasing the E-to-P expectancy  training, selection, resources, clarify roles, provide coaching and feedback  Increasing the P-to-O expectancy  Measure performance accurately, clarify outcomes, explain how rewards are based on past performance, provide examples  Increasing outcome valences  Use valued rewards, individualize rewards, minimize countervalent outcomes

10. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.10 Specific Relevant Challenging Task Effort Task Performance Effective Goal Setting Feedback Participation Commitment

11. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.11 Area of Optimal Goal Difficulty High Task Performance LowModerateChallengingImpossible Effect of Goal Difficulty on Performance Goal Difficulty

12. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.12 Characteristics of Effective Feedback Effective Feedback Specific Relevant Timely Credible Sufficiently frequent

13. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.13 Multisource (360-degree) Feedback Evaluated Employee Co-workerCustomer Subordinate Project leader SupervisorCo-worker Subordinate

14. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.14 Elements of Equity Theory  Outcome/input ratio  inputs -- what employee contributes (e.g., skill)  outcomes -- what employee receives (e.g., pay)  Comparison other  person/people we compare ratio with  not easily identifiable  Equity evaluation  compare outcome/input ratio with the comparison other

15. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.15 Overreward vs Underreward Inequity You Comparison Other Outcomes Inputs Outcomes Inputs Overreward Inequity Outcomes Inputs Outcomes Inputs Underreward Inequity

16. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.16 Consequences of Inequity  Change inputs  Change outcomes  Change perceptions  Leave the field  Act on the comparison other  Change the comparison other

17. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.17 Equity Sensitivity  Benevolents  Tolerant of being underrewarded  Equity Sensitives  Want ratio to be equal to the comparison other  Entitleds  Prefer receiving proportionately more than others

18. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.18 Components of Organizational Justice Emotions Attitudes Behaviours DistributionPrinciples Distributive Justice Perceptions Procedural Justice Perceptions StructuralRules SocialRules

19. Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McShane 5th Canadian Edition Transparency 5.19 Procedural Justice Structural Rules Voice Bias-Free Knowledgeable Consistent Listens to all Appealable