1. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 1 NickelsMcHughMcHugh And Chris Nickels Cover

2. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 2 Chapter 1010 Motivating Employees and Building Self-Managed Teams 10-2

3. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 3  Scientific Management  The Hawthorne Studies and the recognition of Human Motivation recognition of Human Motivation  Maslow’s Hierarchy of Needs  Herzberg’s Motivators and Hygiene factors  Job Enrichment  Theories X,Y, Z  Management By Objectives (MBO)  Expectancy, reinforcement and equity theories equity theories  Open communication and teamwork

4. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 4 1) Scientific Management Scientific Management – studying workers to find the most efficient ways of doing things and then teaching people those techniques.Scientific Management – studying workers to find the most efficient ways of doing things and then teaching people those techniques. Time-motion studies – studies, begun by Frederick Taylor, of which tasks must be performed to complete a job and the time needed to do each task.Time-motion studies – studies, begun by Frederick Taylor, of which tasks must be performed to complete a job and the time needed to do each task.

5. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 5 Evolution of Human Relations Management Concepts Scientific Taylor Taylor Gantt Gantt Gilbreths Gilbreths Behavioral Mayo Maslow Herzberg McGregor Ouchi Vroom

6. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 6 2) The Hawthorne Studies and the Recognition of Human Motivation Hawthorne Effect – the tendency for people to behave differently when they know they are being studied.Hawthorne Effect – the tendency for people to behave differently when they know they are being studied.

7. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 7 3) Maslow’s Hierrachy of Needs Physiological needs – basic survival needs,Physiological needs – basic survival needs, such as the need for food, water and shelter. such as the need for food, water and shelter. Safety needs – the need to feel secure at work Safety needs – the need to feel secure at work and at home. and at home. Social needs – the need to feel loved, accepted, Social needs – the need to feel loved, accepted, and part of the group. and part of the group. Esteem needs – the need for recognition and Esteem needs – the need for recognition and acknowledgement from others, as well as self acknowledgement from others, as well as self respect and a sense of status or importance. respect and a sense of status or importance. Self-actualization needs – the need to develop to Self-actualization needs – the need to develop to one’s fullest potential. one’s fullest potential.

8. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 8 Maslow’s Hierarchy of Needs Physiological Needs Safety Needs Social Needs Esteem Needs Self- Self-Actualization Unsatisfied Satisfied

9. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 9 4) Herzberg’s Motivators and Hygiene Factors Motivators – job factors that cause employees to be productive and give them satisfaction.Motivators – job factors that cause employees to be productive and give them satisfaction. Hygiene factors – job factors that can Hygiene factors – job factors that can cause dissatisfaction if missing but do not cause dissatisfaction if missing but do not necessarily motivate employees if necessarily motivate employees if increased. increased.

10. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 10 Figure 10.5 Comparison of Maslow and Herzberg Herzberg’s Theory

11. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 11 5) Job Enrichment Job enrichment – a motivational strategy that emphasizes motivating the worker through the job itself.Job enrichment – a motivational strategy that emphasizes motivating the worker through the job itself. Job rotation – a job enrichment strategy that Job rotation – a job enrichment strategy that involves moving employees from one job to involves moving employees from one job to another. another. Job enlargement – a job enrichment strategy Job enlargement – a job enrichment strategy that involves combining a series of tasks that involves combining a series of tasks into one challenging and interesting into one challenging and interesting assignment. assignment.

12. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 12 Job-Oriented Motivational Techniques  Job Enrichment/Redesign Skill VarietySkill Variety Task Identity/SignificanceTask Identity/Significance AutonomyAutonomy FeedbackFeedback  Job Simplification  Job Enlargement  Job Rotation

13. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 13 6) Theories X, Y, Z X : workers are lazy and stupidX : workers are lazy and stupid Y : workers are naturally motivated and giftedY : workers are naturally motivated and gifted Z : combine Japanese and American approaches during 1980’sZ : combine Japanese and American approaches during 1980’s

14. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 14 McGregor’s Theories Theory X- Autocratic Dislike WorkDislike Work Avoid ResponsibilityAvoid Responsibility Little AmbitionLittle Ambition Force/Control/ Direct/ThreatenForce/Control/ Direct/Threaten Motivated by Fear & MoneyMotivated by Fear & Money Theory Y- Democratic Like WorkLike Work Naturally Works Toward GoalsNaturally Works Toward Goals Seeks ResponsibilitySeeks Responsibility Imaginative, Creative, CleverImaginative, Creative, Clever Motivated by EmpowermentMotivated by Empowerment

15. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 15 Ouchi’s Theory Z  Long-Term Employment  Collective Decision-making  Individual Responsibility  Slow Evaluation/ Promotion  Specialized Career Path  Holistic Concern for Employees

16. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 16 7) Management by Objectives (MBO) MBO – a system of goal setting and implementation that involves a cycle of discussion, review, and evaluation of objectives among top and middle-level managers, supervisors, and employees.MBO – a system of goal setting and implementation that involves a cycle of discussion, review, and evaluation of objectives among top and middle-level managers, supervisors, and employees.

17. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 17 Goal-Setting Theory (MBO)  Goal-Setting Theory  Management By Objectives (1960s) Employees Motivate ThemselvesEmployees Motivate Themselves HelpHelp CoachCoach

18. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 18 8) Expectancy, Reinforcement and Equity Theories Expectancy theory – the amount of effort employees exert on a task depends on their expectations of the outcome.Expectancy theory – the amount of effort employees exert on a task depends on their expectations of the outcome. Reinforcement theory – positive and negative reinforcers motivate a person to behave in certain ways.Reinforcement theory – positive and negative reinforcers motivate a person to behave in certain ways. Equity theory – the idea that employees try to maintain equity between inputs and outputs compared to others in similar positions.Equity theory – the idea that employees try to maintain equity between inputs and outputs compared to others in similar positions.

19. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 19 Employee-Oriented Motivational Techniques Expectancy TheoryExpectancy Theory Equity TheoryEquity Theory

20. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 20 Expectancy Theory: Employee Questions  What is the probability that I can perform at the required level if I try?  What is the likelihood my performance will lead to the desired outcomes?  What value do I place on the outcome?

21. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 21  Determine rewards valued by employees.  Evaluate performance level you seek.  Make performance level attainable.  Make reward valuable to employee. How to Use Expectancy Theory

22. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 22 9) Open Communication and Teamwork Cross-functional teams – groups of employees from different departments who work together on a long-term basis.Cross-functional teams – groups of employees from different departments who work together on a long-term basis.

23. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 23 Teamwork & Open Communication  Self-Managed Teams = Open Communication  Identify Procedures  Apply Procedures  Change Not Easy  Employee Empowerment

24. McGraw-Hill/Irwin Understanding Business, 7/e © 2005 The McGraw-Hill Companies, Inc., All Rights Reserved. 10- 24 Keys to Building Employee Trust  Start from a position of trust  Be consistent  Listen with an open mind & respect others’ opinions  Admit your mistakes  Give credit where credit is due Source: Source: Communication Solutions