1. Copyright © 2006 Pearson Education Canada Inc. 9-1 Chapter 9 Motivating, Satisfying, and Leading Employees

2. Copyright © 2006 Pearson Education Canada Inc. 9-2 Learning Objectives Describe the nature and importance of psychological contracts in the workplace Discuss the importance of job satisfaction and employee morale and summarize their roles in human relations in the workplace Identify and summarize the most important theories of employee motivation Describe some of the strategies used by organizations to improve job satisfaction and employee motivation Discuss different managerial styles of leadership and their impact on human relations in the workplace

3. Copyright © 2006 Pearson Education Canada Inc. 9-3 Psychological Contract The set of expectations held by an employee concerning what he or she will contribute to an organization and what the organization will provide the employee in return If either party perceives an inequity in the contract, that party may seek a change Employees may seek increased wages, or they may reduce their efforts Employers may fire staff, offer more training, or transfer staff

4. Copyright © 2006 Pearson Education Canada Inc. 9-4 Job Satisfaction and Morale Job satisfaction The sense of accomplishment employees feel from performing their jobs well When job satisfaction is high, so is employee morale Employee morale The mental attitude that employees have towards their workplace

5. Copyright © 2006 Pearson Education Canada Inc. 9-5 Satisfaction Enhances Performance Increased commitment to their work and the firm Work harder to contribute to the organization Have fewer grievances Have lower absenteeism Are less likely to leave the organization

6. Copyright © 2006 Pearson Education Canada Inc. 9-6 Motivation in the Workplace Motivation The set of forces that cause people to behave in certain ways Motivational theories Classical theory and scientific management Behaviour theory Contemporary theory

7. Copyright © 2006 Pearson Education Canada Inc. 9-7 Classical Theory & Scientific Management Classical theory Workers are motivated primarily by money If money motivates, then paying employees more would result in higher levels of production Scientific management Analyzes jobs and finds more efficient ways to perform them Time-and-motion studies

8. Copyright © 2006 Pearson Education Canada Inc. 9-8 Hawthorne Studies Researchers attempted to measure the impact of lighting on productivity Productivity increased whether or not the lighting was high or low Something, other than money and lighting, was impacting on performance Key factor: attention Hawthorne effect The tendency of workers to increase productivity when they receive special attention from management

9. Copyright © 2006 Pearson Education Canada Inc. 9-9 Contemporary Motivation Theories Based on the importance of good human relations in motivating employees Human-resources model Hierarchy of needs model Two-factor theory Expectancy theory Equity theory Goal-setting theory

10. Copyright © 2006 Pearson Education Canada Inc. 9-10 The Human Resources Model: Theories X and Y Two different management views of the firm’s human resources Theory X Employees must be forced to be productive because they are naturally lazy, irresponsible, and unco-operative Theory Y Employees want to be productive because they are naturally energetic, responsible, and co-operative

11. Copyright © 2006 Pearson Education Canada Inc. 9-11 Theory X Employees Lazy Lack ambition Dislike responsibility Self-centred Resist change Gullible and unintelligent Must be punished or rewarded to stimulate motivation

12. Copyright © 2006 Pearson Education Canada Inc. 9-12 Theory Y Employees Energetic Ambitious Responsible Selfless Want to contribute to business success Intelligent

13. Copyright © 2006 Pearson Education Canada Inc. 9-13 Maslow’s Hierarchy of Needs Needs are hierarchical Lower level needs must be met first Only unsatisfied needs motivate workers Needs levels Self-actualization Esteem Social Security Physiological

14. Copyright © 2006 Pearson Education Canada Inc. 9-14 Physiological Needs Basic survival requirements Food Shelter Water Sleep Business addresses these needs by providing comfortable work environments and sufficient salaries to buy food and shelter

15. Copyright © 2006 Pearson Education Canada Inc. 9-15 Security Needs Need for stability and protection from unknown Employers offer Pension plans Job security Personal safety

16. Copyright © 2006 Pearson Education Canada Inc. 9-16 Social Needs Need for friendship and companionship Need to belong to a group Need to “fit in” and be accepted Making friends at work can help satisfy social needs

17. Copyright © 2006 Pearson Education Canada Inc. 9-17 Esteem Needs Need for status and recognition from others Need for self-respect Respected job titles and large offices are among the things that business can provide to address these needs

18. Copyright © 2006 Pearson Education Canada Inc. 9-18 Self-actualization Need Need for self-fulfillment Need for personal growth and development Need to contribute to society and achieve meaningful goals Need to be true to yourself and satisfy yourself Challenging job assignments can help satisfy these needs

19. Copyright © 2006 Pearson Education Canada Inc. 9-19 Two-factor Theory Two different factors affect job satisfaction and dissatisfaction Hygiene factors Cause job dissatisfaction if they are missing or inadequate Motivation factors Cause job satisfaction if they are present and satisfactory

20. Copyright © 2006 Pearson Education Canada Inc. 9-20 Hygiene Factors Working conditions and clearly stated policies If present, the employee is not dissatisfied If absent or deficient, the employee is dissatisfied  Working conditions  Interpersonal relations  Pay and security  Company policies and administration

21. Copyright © 2006 Pearson Education Canada Inc. 9-21 Motivation Factors Recognition or added responsibility if absent, the employee is not satisfied (but not dissatisfied either)  achievement  recognition  the work itself  responsibility  advancement and growth

22. Copyright © 2006 Pearson Education Canada Inc. 9-22 Expectancy Theory People are motivated to work towards rewards that they want and that they believe they have a reasonable chance of obtaining Motivation is based on the belief that performance is linked to the reward he/she can perform at a level to achieve the required results the reward is valuable

23. Copyright © 2006 Pearson Education Canada Inc. 9-23 Expectancy Theory Model Individual Effort Individual Performance Organizational Rewards Personal Goals Effort- Performance issue Performance- Reward issue Rewards- Personal Goals issue

24. Copyright © 2006 Pearson Education Canada Inc. 9-24 Equity Theory Employees use social comparisons to evaluate their treatment by the organization Individuals compare What they contribute relative to what they get in return Their input/output ratio with what they feel others are getting The result is a feelings of equity or inequity The ratios must be fair, not the same, to have a sense of equity

25. Copyright © 2006 Pearson Education Canada Inc. 9-25 Dealing with Inequity Employees will attempt to restore equity in an inequitable situation seeking raises reducing work effort reducing work week complaining to their superiors seeking different employees for comparison quitting the job

26. Copyright © 2006 Pearson Education Canada Inc. 9-26 Goal-setting Theory Employees perform better when they set specific, quantified, time-framed goals Goals are challenging and specific Energy and attention can be focused on the task to be accomplished Employees participate in setting their own goals, which increases their commitment and motivation to achieve the goals

27. Copyright © 2006 Pearson Education Canada Inc. 9-27 Programs for Enhancing Job Satisfaction Reinforcement & punishment Management by objectives Participative management Quality circles Job enrichment Job redesign Modified work schedules Workshare programs

28. Copyright © 2006 Pearson Education Canada Inc. 9-28 Reinforcement Positive behaviour is reinforced through rewards Cash bonuses for performance Negative behaviour is punished Less pay, fewer hours, suspension, dismissal This management approach is most effective when employees are trying to master new skills or behaviours

29. Copyright © 2006 Pearson Education Canada Inc. 9-29 Management by Objectives Employees will be motivated to obtain goals that they help to set Improves relations between superior and subordinates by nature of the consultative process Assessment of performance in meeting goals provides immediate feedback on success and individual contributions, which can lead to feelings of equity in the firm

30. Copyright © 2006 Pearson Education Canada Inc. 9-30 Participative Management Employees will be more satisfied on the job if they have a say in how they do their jobs and how the company is managed Can make employees more committed to the organization and achieving goals Popular in Japanese firms and gaining acceptance in Canada

31. Copyright © 2006 Pearson Education Canada Inc. 9-31 Job Enrichment Changing the nature of the job, the way various jobs work together, or through having employees rotate through jobs Increases job satisfaction by changing the job Increased responsibility or growth Employees acquire new skills and feel valued

32. Copyright © 2006 Pearson Education Canada Inc. 9-32 Job Redesign Increases job satisfaction by improving the employee-job fit Combining tasks Forming natural workgroups Establishing client relationships Useful when individuals have a high personal need for growth or achievement

33. Copyright © 2006 Pearson Education Canada Inc. 9-33 Redesign Methods Combining tasks Enlarges the job thus increasing responsibility Work seems more meaningful Natural workgroups Creates teams among individuals who work on projects Enhances their understanding of the function of the organization, and the problem-solving abilities of the team Establish client relationships Allows employees to interact with customers More variety and more control over their jobs

34. Copyright © 2006 Pearson Education Canada Inc. 9-34 Modified Work Schedules Allows individuals to fulfill work commitments more effectively around personal or community obligations Helps increase job satisfaction Flextime Compressed workweek Telecommuting Workshare programs

35. Copyright © 2006 Pearson Education Canada Inc. 9-35 Flextime Adjusts the standard daily work schedule to fit employees’ needs Basic office hours ( 9:00 a.m. To 5:00 p.m.) They must all be available from 10:00 a.m. To 3:00 p.m. (The core time) Therefore, they may come in from 7:00 a.m. To 3:00 p.m., Or as late as 10:00 a.m. To 6:00 p.m Some offices will also allow flexible hours between 11:00 a.m. And 1:00 p.m. For lunch

36. Copyright © 2006 Pearson Education Canada Inc. 9-36 The Compressed Workweek Employees may work their required weekly hourly requirement over fewer than five working days Employees work longer hours on the days they work Potential scheduling options 40 hours = 5 days x 8 hours 40 hours = 4 days x 10 hours 40 hours = 3 days x 13.33 hours (often worked into a 36-hour week at 12 hours/day)

37. Copyright © 2006 Pearson Education Canada Inc. 9-37 Telecommuting Employees are permitted to work away from the office Home-based office technology are employed Computers, voicemail, e-mail, fax modems, cell phones, overnight delivery services Barriers Fear of not being internally motivated & missing deadlines Coordinating family and work responsibilities

38. Copyright © 2006 Pearson Education Canada Inc. 9-38 Worksharing Two people share a single, full-time position Also referred to as job sharing Useful for those who wish to stay in the workforce part-time Parents of young children Individuals easing into retirement 8% of part-time Canadian workers are worksharing Most workshare employees are university- educated women in professional occupations

39. Copyright © 2006 Pearson Education Canada Inc. 9-39 Managerial Styles and Leadership Leadership The process of motivating others to work to meet specific objectives Managerial style Patterns of behaviour that a manager exhibits in dealing with subordinates  Autocratic style  Democratic style  Free-rein style

40. Copyright © 2006 Pearson Education Canada Inc. 9-40 Autocratic Style Managers issue orders and expect them to be obeyed without question or discussion Decision making occurs rapidly due to lack of consultation Useful for situations where quick decision making and conformity is required  Military applications This style suits employees who do not want to make decisions

41. Copyright © 2006 Pearson Education Canada Inc. 9-41 Democratic Style Managers ask for input from subordinates but retain final decision-making power Benefits those who wish to have input Can lead to frustration if the manager’s decisions are not consistent with the input Annoys those who do not wish to have input

42. Copyright © 2006 Pearson Education Canada Inc. 9-42 Free-rein Style Managers simply advise subordinates Employees have the authority to make the final decisions themselves May be useful in circumstances where a loose structure exists  A volunteer organization

43. Copyright © 2006 Pearson Education Canada Inc. 9-43 Canadians Vs. Americans Canadian managers tend to be More quiet or subdued More committed to their organizations More independent thinkers More culturally tolerant

44. Copyright © 2006 Pearson Education Canada Inc. 9-44 Contingency Approach to Leadership The most effective management style depends on the situation being managed Observes cultural differences that affect the interpretation of situations and employee needs Not all subordinates wish to have a role in decision making Success is achieved by adjusting one’s management style to suit the situation involved

45. Copyright © 2006 Pearson Education Canada Inc. 9-45 Motivation & Leadership in the 21st Century Changing patterns of motivation Rewards desired by today’s employees are different from those of yesterday’s  Money may not be the prime motivator  Individual goals vary more than ever before Changing patterns of leadership Less of an emphasis on autocratic styles as employees become more empowered