1. ©2007 Prentice Hall Organizational Behavior: An Introduction to Your Life in Organizations Chapter 4 Fundamentals of Motivation

2. ©2007 Prentice Hall Preview What makes people work harder, smarter, and more positively? How can managers tap an employee’s intrinsic motivation? How do managers motivate using rewards and punishments? How do managers use behavior modification to design performance appraisals and reward systems? What organizational systems do companies use to motivate their employees? When motivating yourself and others, also …

3. ©2007 Prentice Hall Motivation An individual’s direction, intensity and persistence of effort in attaining a goal Intrinsic motivators are inner influences that cause a person to act Extrinsic motivators are external influences that cause a person to act, including both rewards and punishments

4. ©2007 Prentice Hall Money--the universal reinforcer Called the universal reinforcer because you can exchange it for so many things Can help satisfy lower order and higher order needs

5. ©2007 Prentice Hall How can manages tap an employee’s intrinsic motivation? Main intrinsic factors that motivate us are:  our personality  emotions  needs and motives  goals  beliefs

6. ©2007 Prentice Hall Personality Internal-external locus of control affects motivation depending on the job requirements Self-efficacy is a person’s generalized belief in their ability to execute a course of action in any given situation Independent and interdependent self- concepts affect focus on helping themselves or the group

7. ©2007 Prentice Hall Needs and motives Needs are unconscious patterns, some developed early in life and some perhaps instinctive, that lead to emotional and behavioral preferences McClelland’s needs theory:  need for achievement  need for power  need for affiliation

8. ©2007 Prentice Hall Needs and motives Humanistic needs: managers should pay attention to meeting individual needs like personal growth and purpose in life Sociobiology suggests that the most fundamental, instinctual, human needs are to reproduce and preserve life (untested) Explicit motives: the reasons people give for their actions

9. ©2007 Prentice Hall Goals Set specific goals Set tough but achievable goals Establish feedback for goal achievement Keep in mind that learning goals motivate differently than performance goals Account for the limitations of goal setting

10. ©2007 Prentice Hall Beliefs and expectations Expectancy theory: an individual’s effort is determined primarily by his or her beliefs in three key areas:  Expectancy: that one’s effort will lead to an acceptable level of performance  Instrumentality: the belief that the performance level one achieves will result in specific positive and/or negative outcomes  Valence: the belief that the outcome attained will be personally valued

11. ©2007 Prentice Hall Beliefs and expectations Equity theory predicts that you will weigh the ratio of your effort (and other job inputs such as your experience and ability) to your rewards against that of others Distributive justice: the perceived fairness of outcomes in terms of how rewards and resources are allocated in an organization

12. ©2007 Prentice Hall The 5-Step OB mod Approach Step 1. Identify the target behavior Step 2. Establish a baseline for the target behavior Step 3. Analyze the antecedents and the consequences of the behavior Step 4. Intervene with a program that emphasizes reinforcement Step 5: Evaluate the intervention to see if it changed the desired behavior

13. ©2007 Prentice Hall The design of performance appraisals Judgment-based evaluation: a manager rates employees on traits that management has deemed to be important Results-based evaluation: rating employees on their performance over time Behaviorally-based evaluation: observable behaviors are rated on a quantifiable measure such as their frequency, and the frequency of the behaviors is summarized in a behaviorally anchored rating scheme (BARS)

14. ©2007 Prentice Hall Limitations of behavior modification Most successful when applied to simple tasks For the more complex tasks in professional and managerial work, feedback typically has the strongest effect on work performance, followed by social recognition and then money

15. ©2007 Prentice Hall Systems that emphasize pay Mixed results for pay based on general performance Pay as a reinforcement for targeted behaviors is effective Variable-pay programs blend a set salary, sometimes a relatively modest one, with pay contingent on some output measure

16. ©2007 Prentice Hall Systems that emphasize goals Management by Objectives (MBO): supervisors and their subordinates jointly decide the individual employee’s goals for the year The employees’ rewards for the year depend on how well they meet their goals

17. ©2007 Prentice Hall Systems that emphasize participation Quality circles are teams of employees who meet to discuss quality improvements Self-managed teams are autonomous groups that take on some of the tasks typically done by supervisors

18. ©2007 Prentice Hall Systems that maximize intrinsic and extrinsic motivation Employee stock ownership plans (ESOPs) are particular plans that allow employees to buy stock Must show cause-and-effect relationship between work and success Employees are vulnerable if the stock value plunges

19. ©2007 Prentice Hall Recent trends As jobs become more information-based and complex, it is harder to use standards for productivity Since long term relationships between employees and their companies are declining, the motivating value of such relationships is being lost Some theorists believe that monetary reward alone will never be a sufficient motivator because it does not reduce conflicts of interest and make people pursue common goals

20. ©2007 Prentice Hall Take national culture into account Learned behaviors are culture bound Cultures differ on how they value work itself Cultures also differ in terms of the motivation systems they will accept

21. ©2007 Prentice Hall Apply what you have learned World Class Company: Hiscox plc Advice from the Pro’s Gain Experience Can you solve this manager’s problem?

22. ©2007 Prentice Hall Summary – What makes people work harder, smarter, and more positively? Managers attempt to use both intrinsic and extrinsic motivators Managers must be realistic about their ability to control others’ behavior The universal reinforcer is money

23. ©2007 Prentice Hall Summary – How can managers tap an employee’s person’s intrinsic motivation? Managers should select appropriate individuals if a job requires a certain type of personality or emotion Managers might reasonably attempt to influence an individual’s goals, beliefs or expectations

24. ©2007 Prentice Hall Summary – How do managers motivate using rewards and punishments? OB Mod is the theory that behavior can be controlled by extrinsic factors, namely reinforcements and punishments The goal of an OB Mod program is to change observable and quantifiable behaviors OB Mod has sparked many business applications

25. ©2007 Prentice Hall Summary – How do managers use behavior modification to design performance appraisals and reward systems? Managers can choose either judgment- based, results-based, or behaviorally- based performance appraisals Managers should be careful to reward the right behaviors, and to chose appropriate schedules of reinforcement

26. ©2007 Prentice Hall Summary – What organizational systems do companies use to motivate their employees? Some emphasize pay Others emphasize feedback and recognition Some create an Employee Stock Ownership Plan, or ESOP

27. ©2007 Prentice Hall Summary – When motivating yourself and others, also… Weigh recent trends Take national culture into account Motivate yourself to motivate others.