1. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–1 Chapter 8 Employee Behavior and Motivation If all it took was a pretty picture and a catchy saying to motivate people, running a business would be a whole lot simpler.

2. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–2 MPC’s Deeper Offerings Busi 22 Human Behavior/Leadership  Psychological techniques in job performance and satisfaction  Leadership skills, human motivation, time management, values, decision making, career management  Instructor: Leandro Castillo aka MPC’s running back coach!

3. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–3 Key Topics Psychological contracts in the workplace Job satisfaction and employee morale Theories of employee motivation Managerial motivation techniques Running theme: Putting these concepts into action.

4. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–4 Key Topics Psychological contracts in the workplace Job satisfaction and employee morale Theories of employee motivation Managerial motivation techniques Running theme: Putting these concepts into action.

5. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–5 Psychological Contract: A Set of Employment Expectations Contributions:  What does each employee expect to contribute to the organization?  Performance behaviors & citizenship  Counterproductive behaviors Inducements:  What will the organization provide to each employee in return?  Pay, benefits, security, opportunity, and more Table 9–1 What should you expect as a worker: Get paid more then work hard, or work hard then get paid more? Which results in a higher return to the employer: A higher paid worker or a lower paid worker?

6. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–6 Satisfied Employees Are More Committed and Productive Job Satisfaction:  Degree of enjoyment employees derive from their jobs High Morale:  An overall positive employee attitude toward the workplace Low Turnover:  A low percentage of employees leave each year Productivity  Maximizing output from inputs  Marginal cost = marginal benefit MORALE TURNOVER MORALE

7. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–7 Effective Motivation leads to desired behavior, satisfaction, and performance Motivation:  The set of forces that cause people to behave in certain ways So how do we do it already? Job Satisfaction High Morale Low Turnover Productivity

8. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–8 The Effective Motivation Disconnect Manager – Employee Motivation Index

9. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–9 Key Topics Psychological contracts in the workplace Job satisfaction and employee morale Theories of employee motivation Managerial motivation techniques Running theme: Putting these concepts into action.

10. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–10 Raising Morale Is a High Priority When Unemployment Is Low

11. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–11 The evolution of motivational theory Classical Theory  Fredrick Taylor’s Scientific Management Behavior  The Hawthorne Effect Contemporary motivational theories  More detailed psychological approaches  Recognizing people as individuals

12. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–12 Scientific Management Fredrick Taylor, the father of Scientific Management  Gantt charts!  Time & motion studies  Standardization, methods, layout, task-training  Improve efficiency so you can afford to pay higher wages (motivation)  Scientific Management C&C with TQM & Lean?

13. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–13 The Hawthorn Studies: 1925ish-1933 A Harvard group led by Elton Mayo invaded the Hawthorn Western Electric plant in Cicero Illinois Experimented with the effects of lighting levels on productivity Any change increased productivity, even very dim lighting. The productivity increases were maintained even when lighting was returned to previous levels……. They thought their experiments were a total failure

14. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–14 The Hawthorn Effect was born: The workers thought of themselves as a team, or group with something in common. The workers helped plan the experiments. Their ideas were appreciated and implemented. The workers got special attention. Their increased productivity was compensated. Learned: People perform better when they matter. This unleashed the storm of modern motivational theories that we will now explore.

15. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–15 Douglas McGregor’s Model of Management’s Views: Theory X  People are lazy.  People lack ambition and dislike responsibility.  People are self-centered.  People resist change.  People are gullible and not very bright. Theory Y  People are energetic.  People are ambitious and seek responsibility.  People can be selfless.  People want to contribute to business growth and change.  People are intelligent. Table 9–1 Which manager will feel most comfortable in a tall organization? Which manager has trouble delegating?Which manager gives workers the “in the loop” updates to make them feel involved? Which manager runs more risk of being taken advantage of by employees? Which manager attracts more high-contributing workers to their organization? Which manager misses deadlines because they didn’t follow up with employees enough? Which traits are strongest in you?

16. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–16 Abraham Maslow’s Hierarchy of Needs Figure 9–1

17. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–17 What level motivates me if I am: Starving Homeless, but fed Isolated Needing to prove something to myself Trying to make a difference in the world A typical American worker

18. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–18 What level motivates me if I am: Starving Homeless, but fed Isolated Needing to prove something to mom Trying to make a difference in the world A typical American worker Physiological Needs Safety Needs Social Needs Esteem Needs Self- Self-Actualization

19. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–19 Two-Factor Theory of Motivation (Herzberg) Figure 9–2

20. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–20 Which is it? Figure 9–2 Motivation Factors achievement recognition the work itself responsibility advancement and growth Hygiene Factors supervisors working conditions interpersonal relations pay & security company policies and administration You got a bonus for outstanding performance? You just love driving that cab like a maniac. You are learning new things everyday. Your boss is completely unreasonable. You earn a comfortable living. You get the keys to the executive washroom.

21. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–21 Expectancy Theory Figure 9–3 Do I want the reward? Will my performance get me the reward? Is the reward big enough? Where did the manager fail in goal setting? Oh boy! A whole $5.00 for winning the sales contestThat open promotion is sure to go to the boss’s daughter.To get my next promotion I have to move to TimbuktuThe harder you work around here, the more work you get. We work toward rewards that are worth the effort, we have a reasonable chance of getting, and we want.

22. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–22 Equity Theory Employees evaluate their treatment relative to the treatment of others  Inputs: Employee contributions to their jobs  Outputs: What employees receive in return The perceived ratio of contribution to return determines perceived equity. Workers will attempt to adjust their inputs and/or outputs until they feel their perceived equity is….. equitable.

23. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–23 Equity Theory: Situation Outcomes Figure 9–4 I will do my best work possible next time I will work less next time I will steal from the company I will sabotage the quality of the product That test was way too easy. We are all going to get A’s. That test was way too hard, I’ll never be able to get an “A”. My boss just won’t pay me as much as I am worth. My boss took all the credit for that production process suggestion I made. That test was hard, but it was because I just didn’t study enough. Whew, I barely got an “A”. That studying paid off!

24. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–24 Individual differences in employees Different people are at different points in all of these scales. Personality typing is one technique to gauge how to manage or lead individuals. Personality type lessons we’ll learn:  Your strengths  Your weaknesses  How you need to be treated  How others need you to treat them

25. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–25 Situational Approach to Leadership The Four Square model High Skill Low High Motivation Low Basically leave them alone. Provide strong coaching light motivation Provide light coaching and strong motivation Provide strong coaching and strong motivation

26. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–26 Personality Type Activity Grueling pre-work:  Complete the booklet as per the directions.  Need pointers? Follow up:  Join the group of your similar personality types folks  Answer some questions to reveal one of the most important set of motivational secrets of all time.

27. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–27 Decoding Personality Popular + Enthusiastic, spontaneous, creative - Loud, too-happy, forgetful, not believable Powerful + Lead, meets goals, strong-willed, ME - Bossy, know it all, deny failure Peaceful + Calm, steady, listens, compassionate - Worrier, slow starter, seems indifferent Perfect + Analytical, serious, finish everything - Overly critical, over-plan, unforgiving Where do conflicts happen?Can any type lead?What types make strong teams?What makes each type happy?

28. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–28 Personality Type Activity Grueling homework:  Complete the booklet as per the directions.  Need pointers? In-Class next time:  Post results confidentially and evaluate relationships  Or, if enough want to, we can do a more in depth conflict raising activity to bring the feelings into play real time

29. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–29 Follow up questions: What strengths does your personality type give you? How do these strengths show up in your behaviors? What weaknesses does your personality type give you? How do these weaknesses show up in your behaviors? What other personality type do you find most irritating?  Which of their behaviors are the most troublesome to you?  Which of your behaviors most upset them? Create two scripts to role play. Try to get them to take charge of organizing a customer appreciation party for you.  Script 1: What you want to naturally say. –What happens when you actually use this approach?  Script 2: The approach your target would find most effective – long term.

30. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–30 Interpreting the Personality Puzzle Popular (Cheerleaders)  Enthusiastic, spontaneous, creative  Loud, too-happy, forgetful, seem false Powerful (Steamrollers)  Lead, meets goals, strong-willed, ME  Bossy, know it all, deny failure Peaceful (Medic)  Calm, steady, listens, compassionate  Worrier, slow starter, seems indifferent Perfect (Computers)  Analytical, serious, finish everything  Overly critical, over-plan, unforgiving Where conflicts happen Can any type lead? What type(s) do you want on a team? How do keep each type happy?

31. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–31 Strategies for Enhancing Job Satisfaction and Morale Reinforcement/behavior modification Management by objectives Participative management and empowerment Job enrichment and job redesign Modified work schedules Then we will see if we can connect strategy theory to apply some serious motivation!

32. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–32 Reinforcement/Behavior Modification Positive Reinforcement PunishmentPunishment When rewards are tied directly to performance. When negative consequences are attached directly to undesirable behavior. No one is apathetic except in the pursuit of someone else’s goals. - Anonymous

33. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–33 Positive Reinforcement PunishmentPunishment Psychological Contract  Stop bad behavior, encourage good  Job Satisfaction, Turnover, morale Scientific Management  Efficiency allows money incentives The Hawthorne Effect  Watch, display, improve McGregor’s X & Y Theories  X (lazy), Y (dedicated) Maslow’s Hierarchy of Needs  Reaching next level motivates Herzberg’s 2 factors  Hygiene vs. motivating Expectancy Theory  Size, Expectations, Valued Equity theory  Getting even Personality Strategy & Theory Relationships Relate the theories to the strategy

34. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–34 Identifying Resources Counseling Setting Verifiable Goals and Clear Plans Meeting Management by Objectives (MBO): Collaborative Goal-setting Collaborative Goal Setting and Planning Organizational Goals and Plans Communicating Organizational Goals and Plans Periodic Review Evaluation Figure 9–5 Provide Reward

35. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–35 Management by Objectives (MBO): Collaborative Goal-setting Strategy & Theory Relationships Psychological Contract  Stop bad behavior, encourage good  Job Satisfaction, Turnover, morale Scientific Management  Efficiency allows money incentives The Hawthorne Effect  Watch, display, improve McGregor’s X & Y Theories  X (lazy), Y (dedicated) Maslow’s Hierarchy of Needs  Reaching next level motivates Herzberg’s 2 factors  Hygiene vs. motivating Expectancy Theory  Size, Expectations, Valued Equity theory  Getting even Personality Relate the theories to the strategy

36. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–36 Participative Management, Empowerment & Teams Increasing job satisfaction by encouraging participation Team management represents a growing trend. “There is no “ I ” in team, but there is an “M” and an “E”.” - Jon Mikkelsen

37. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–37 Strategy & Theory Relationships Empowerment & Teams Psychological Contract  Stop bad behavior, encourage good  Job Satisfaction, Turnover, morale Scientific Management  Efficiency allows money incentives The Hawthorne Effect  Watch, display, improve McGregor’s X & Y Theories  X (lazy), Y (dedicated) Maslow’s Hierarchy of Needs  Reaching next level motivates Herzberg’s 2 factors  Hygiene vs. motivating Expectancy Theory  Size, Expectations, Valued Equity theory  Getting even Personality Relate the theories to the strategy

38. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–38 Job Enrichment and Job Redesign Job Enrichment:  Adding one or more motivating factors to job activities Job Redesign:  Designing a better fit between workers and their jobs  Combining tasks  Forming natural work groups  Establishing client relationships

39. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–39 Modified Work Schedules Work share programs Flextime programs and alternative workplace strategies Telecommuting and virtual offices

40. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–40 Sample Flextime Scheduling Figure 9–6

41. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–41 Evaluating Modified Schedules and Alternative Workplaces Advantages  More satisfied, committed employees  Less congestion Disadvantages  Challenging to coordinate and manage  Poor fit for some workers

42. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–42 Strategy & Theory Relationships Job Enrichment & Job Redesign Psychological Contract  Stop bad behavior, encourage good  Job Satisfaction, Turnover, morale Scientific Management  Efficiency allows money incentives The Hawthorne Effect  Watch, display, improve McGregor’s X & Y Theories  X (lazy), Y (dedicated) Maslow’s Hierarchy of Needs  Reaching next level motivates Herzberg’s 2 factors  Hygiene vs. motivating Expectancy Theory  Size, Expectations, Valued Equity theory  Getting even Personality Relate the theories to the strategy

43. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–43 The process of motivating others to work to meet specific objectives Leadership

44. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–44 Managerial Leadership Styles Contingency Approach The appropriate style in any situation is contingent on the unique elements of that situation Contingency Approach The appropriate style in any situation is contingent on the unique elements of that situation Autocratic Style Democratic Style Free-rein Style

45. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–45 Managerial Leadership Style: AutocraticDemocraticFree-reign AutocraticDemocraticFree-reign Strategy & Theory Relationships Psychological Contract  Stop bad behavior, encourage good  Job satisfaction, turnover, morale Scientific Management  Efficiency allows money incentives The Hawthorne Effect  Watch, teamwork, improve McGregor’s X & Y Theories  X (lazy), Y (dedicated) Maslow’s Hierarchy of Needs  Reaching next level motivates Herzberg’s 2 factors  Hygiene vs. motivating Expectancy Theory  Size, Expectations, Valued Equity theory  Getting even Personality

46. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–46 Motivation and Leadership in the 21st Century MotivationMotivation  Security and pay are no longer enough LeadershipLeadership  “Coach” mentality  Supporting role  Diversity  Flexibility Leading down, sideways, & upLeading down, sideways, & up

47. Copyright © 2005 Prentice Hall, Inc. All rights reserved.9–47 Chapter Review Describe psychological contracts Discuss the importance of job satisfaction and employee morale Summarize the most important theories of employee motivation Describe strategies to improve job satisfaction and employee motivation Discuss different managerial styles