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Motivation: From concept to applications

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Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UK Essays.

Published: Mon, 5 Dec 2016

CHAPTER OVERVIEW

We have presented a number of motivation theories and applications in this and the previous chapter. While it is always dangerous to synthesize a large number of complex ideas into a few simple guidelines, the following suggestions summarize the essence of what we know about motivating employees in organizations.

Recognize individual differences. Employees have different needs. Do not treat them all alike. Moreover, spend the time necessary to understand what is important to each employee. This will allow you to individualize goals, level of involvement, and rewards to align with individual needs.

Use goals and feedback. Employees should have hard, specific goals, as well as feedback on how well they are faring in pursuit of those goals.

Allow employees to participate in decisions that affect them. Employees can contribute to a number of decisions that affect them: setting work goals, choosing their own benefits packages, solving productivity and quality problems, and the like. This can increase employee productivity, commitment to work goals, motivation, and job satisfaction.

Link rewards to performance. Rewards should be contingent on performance. Importantly, employees must perceive a clear linkage. Regardless of how closely rewards are actually correlated to performance criteria, if individuals perceive this relationship to be low, the results will be low performance, a decrease in job satisfaction, and an increase in turnover and absenteeism statistics.

Check the system for equity. Rewards should also be perceived by employees as equating with the inputs they bring to the job. At a simplistic level, this should mean that experience, skills, abilities, effort, and other obvious inputs should explain differences in performance and, hence, pay, job assignments, and other obvious rewards.

WEB EXERCISES

At the end of each chapter of this instructor’s manual you will find suggested exercise and ideas for researching the WWW on OB topics. The exercises “Exploring OB Topics on the Web” are set up so that you can simply photocopy the pages, distribute them to your class, and make assignments accordingly. You may want to assign the exercises as an out-of-class activity or as lab activities with your class. Within the lecture notes the graphic will note that there is a WWW activity to support this material.

The chapter opens with the new compensation system implemented by the accounting firm of J.H. Cohn. Traditionally, accounting firms have based compensation in large part on seniority. Cohn, however, has modified its compensation program to reflect pay for performance. Cohn’s CEO, Tom Marino, sees performance based pay as helping motivate younger partners to build the business. It provides incentive and rewards performance.

BRIEF CHAPTER OUTLINE

Management by Objectives

  1. What Is MBO?
  1. Management by objectives emphasizes participatively set goals that are tangible, verifiable, and measurable.
  2. MBO operationalizes objectives by devising a process by which objectives cascade down through the organization. (Exhibit 7-1).
  3. MBO Elements
  • Goal specificity
  • Participative decision making
  • Explicit time period
  • Performance feedback
  1. Linking MBO and Goal-Setting Theory
  1. Goal-setting theory demonstrates that:
  • Hard goals result in a higher level of performance
  • Specific hard goals result in higher levels of performance
  • Feedback on one’s performance leads to higher performance.
  1. MBO directly advocates specific goals and feedback.
  • Goals must be perceived as feasible
  • Most effective when goals require stretching
  1. The only area of possible disagreement with goal setting theory is participation in the setting of goals.
  1. MBO in Practice
  1. MBO is a popular technique

Instructor Note: At this point in the lecture you may want to introduce the TEAM EXERCISE – Goal Setting Task found in the text and at the end of these chapter notes. The purpose of the exercise is to learn how to write tangible, verifiable, measurable, and relevant goals as might evolve from an MBO program.

Employee Recognition Programs

  1. What Are Employee Recognition Programs?
  1. Employee recognition programs consist of personal attention, expressing interest, approval, and appreciation for a job well done.
  1. Linking Recognition Programs and Reinforcement Theory
  1. Research indicates that the most powerful workplace motivator is recognition.
  1. Employee Recognition Programs in Practice
  1. The highly competitive global economy has put most organizations under severe cost pressures, which is why recognition programs are particularly attractive. Recognizing an employee’s superior performance often costs little or no money.

Employee Involvement Programs

  1. What Is Employee Involvement?
  1. A catchall term covering a variety of techniques–participation or participative management, workplace democracy, empowerment, and employee ownership.
  1. Examples of Employee Involvement Programs
  1. Four forms of employee involvement:
  • Participative management
  • Representative participation
  • Quality circles
  • Employee stock ownership plans (ESOP’s)
  1. The evidence consistently indicates that it takes ownership and a participative style of management to achieve significant improvements in an organization’s performance.

Instructor Note: At this point in the lecture you may want to introduce the POINT-COUNTER POINT – The Power of Stock Options As A Motivator found in the text and at the end of these chapter notes. A suggestion for a class exercise follows the introduction of the material.

  1. Linking Employee Involvement Programs and Motivation Theories
  1. Employee involvement draws on a number of the motivation
  • Theory Y is consistent with participative management. Theory X aligns with the more traditional autocratic style of management.
  • Two-factor theory-employee involvement programs could provide intrinsic motivation.
  • Employee involvement is compatible with ERG theory and efforts to stimulate the achievement need.
  1. Employee Involvement Programs in Practice
  1. In Europe, the principle of industrial democracy is fairly well established. Other nations, including Japan and Israel, have some form of representative participation.
  2. Employee involvement programs that stress participation have become the norm in North America.
  3. Employee involvement practices differ between countries. Practices need to be modified to reflect national culture.

Job Redesign and Scheduling Programs

  1. What is job redesign and scheduling
  1. Ways to reshape jobs so that they are more challenging, stimulating, and motivating.
  2. Three Job redesign options-job rotation, job enlargement, and job enrichment
  • Job rotation
  • Job enlargement
  • Job enrichment (Exhibit 7-4)
  1. How does management enrich an employee’s job?
  • Combining tasks
  • Forming natural work units
  • Establishing client relationships
  • Expanding jobs vertically
  • Opening feedback channels
  1. Overall evidence indicates that job enrichment reduces absenteeism and turnover costs and increases satisfaction.
  2. Flextime. (flexible work hours). Allows employees some discretion over when they arrive at and leave work. (Exhibit 7-5).
  3. Job sharing. Allows two or more individuals to split a traditional 40-hour a week job.
  4. Telecommuting. Employees who do their work at home at least two days a week on a computer that is linked to their office.

Variable Pay Programs

  1. What Are Variable-Pay Programs?
  1. Variable Pay Programs can take the form of piece-rate wages, bonuses, profit sharing and gainsharing.
  2. A portion of an employee’s pay is based on some individual and/or organizational measure of performance.
  3. Variable-pay programs are generally successful in increasing motivation and productivity. Studies generally support that organizations with profit-sharing plans have higher levels of profitability than those without.

Instructor Note: At this point in the lecture you may want to introduce the CASE INCIDENT – When the Perks Fade found in the text and at the end of these chapter notes. A suggestion for a class exercise follows the introduction of the material.

  1. Linking Variable-Pay Programs and Expectancy Theory
  1. Variable pay is probably most compatible with expectancy theory predictions. Individuals should perceive a strong relationship between their performance and the rewards they receive if motivation is to be maximized.
  2. The evidence supports the importance of this linkage:
  1. Variable-Pay Programs in Practice
  1. Variable pay is rapidly replacing the annual cost-of-living raise.
  2. The new trend has been expanding this practice to non-managerial employees.
  3. Seventy-eight percent of U.S. companies have some form of variable pay plan with rank and file workers.
  4. Gain sharing’s popularity seems to be narrowly focused among large, unionized manufacturing companies.

Instructor Note: At this point in the lecture you may want to introduce the ETHICAL DILEMMA EXERCISE – Are American CEO’s Paid Too Much? box found in the text and at the end of these chapter notes. A suggestion for a class exercise follows the introduction of the material.

Instructor Note: At this point in the lecture you may want to introduce the OB IN THE NEWS – Pay for Performance at Siebel Systems box found in the text and below. A suggestion for a class exercise follows the introduction of the material below.

Skilled-Based Pay Plans

  1. What Are Skill-Based Pay Plans?
  1. Skill-based pay is an alternative to job-based pay. It is sometimes called competency-based pay or knowledge-based pay.
  2. The appeal, from management’s perspective is flexibility:
  1. Linking Skill-Based Pay Plans to Motivation Theories
  1. Skill-based pay plans are consistent with several motivation theories.
  • ERG theory – because they encourage employees to learn, expand their skills, and grow
  • Achievement need – paying people to expand their skill levels, high achievers will find their jobs more challenging
  • Reinforcement theory – by encouraging employees to develop their flexibility, to continue to learn, to cross-train, to be generalists rather than specialists, and to work cooperatively with others in the organization.
  1. Skill-based pay may additionally have equity implications. When employees make their input-outcome comparisons, skills may provide a fairer input criterion for determining pay than factors such as seniority or education.
  1. Skill-Based Pay in Practice
  1. A number of studies conclude that skill-based pay is expanding and that it generally leads to higher employee performance and satisfaction.

Flexible Benefits

  1. What Are Flexible Benefits?
  1. The idea is to allow each employee to choose a benefit package that is individually tailored to his/her own needs and situation.
  2. An organization sets up a flexible spending account for each employee, usually based on some percentage of his or her salary, and then a price tag is put on each benefit. There are three basic types of programs:
  • Modular Plans:
  • Core-plus Plans:
  • Flexible Spending Plans:
  1. Linking Flexible Benefits and Expectancy Theory
  1. Consistent with expectancy theory’s thesis that organizational rewards should be linked to each individual employee’s goals, flexible benefits individualize rewards by allowing each employee to choose the compensation package that best satisfies his/her current needs.
  1. Flexible Benefits in Practice
  1. From the organization’s standpoint, it often produces savings. Once in place, costly increases often have to be substantially absorbed by the employee.

EXPANDED CHAPTER OUTLINE

Management by Objectives

  1. What Is MBO?
  1. Management by objectives emphasizes participatively set goals that are tangible, verifiable, and measurable. It is not a new idea. It originated more than 50 years ago.
  2. MBO’s appeal lies in its emphasis on converting overall organizational objectives into specific objectives for organizational units and individual members. MBO operationalizes objectives by devising a process by which objectives cascade down through the organization. (Exhibit 7-1).
  3. Common elements in MBO programs:
  4. Goal specificity:

The objectives in MBO should be concise statements of expected accomplishments. Example – To cut departmental costs by seven percent, to improve service by ensuring that all telephone orders are processed within 24 hours of receipt, or to increase quality by keeping returns to less than one percent of sales.

  1. Participative decision making:
  • The objectives in MBO are not unilaterally set by the boss and then assigned to employees.
  • The manager and employee jointly choose the goals and agree on how they will be measured.
  1. An explicit time period:
  • Each objective has a specific time period in which it is to be completed.
  • Typically three months, six months, or a year
  1. Performance feedback

MBO seeks to give continuous feedback on progress toward goals so that workers can monitor and correct their own actions.

  1. Linking MBO and Goal-Setting Theory
  1. Goal-setting theory demonstrates that:
  1. Hard goals result in a higher level of individual performance than do easy goals.
  2. Specific hard goals result in higher levels of performance than no goals at all or generalized goals.
  3. Feedback on one’s performance leads to higher performance.
  1. MBO directly advocates specific goals and feedback.
  1. Implies that goals must be perceived as feasible
  2. Is most effective when the goals are difficult enough to require stretching

The only area of possible disagreement with goal setting theory is participation-MBO strongly advocates it. Goal-setting theory-assigning goals to subordinates-frequently works just as well participation.

  1. MBO in Practice
  1. Reviews of studies suggest that MBO is a popular technique – it is used in business, health care, educational, government, and nonprofit organizations.
  2. MBO’s popularity should not be construed to mean that it always works.
  • Where it has failed, the problems rarely lie with MBO’s basic components.
  • Rather, factors such as unrealistic expectations regarding results, lack of top-management commitment, and an inability or unwillingness by management to allocate rewards based on goal accomplishment are the cause.

Instructor Note: At this point in the lecture you may want to introduce the TEAM EXERCISE – Goal Setting Task found in the text and at the end of these chapter notes. The purpose of the exercise is to learn how to write tangible, verifiable, measurable, and relevant goals as might evolve from an MBO program.

Employee Recognition Programs

  1. What Are Employee Recognition Programs?
  1. Employee recognition programs consist of personal attention, expressing interest, approval, and appreciation for a job well done. They can take numerous forms.
  2. The best ones use multiple sources and recognize both individual and group accomplishments.
  1. Linking Recognition Programs and Reinforcement Theory
  1. Fifteen-hundred employees were surveyed in a variety of work settings about what they considered to be the most powerful workplace motivator. Their response was “recognition!”
  2. Consistent with reinforcement theory, rewarding a behavior with recognition immediately following that behavior is likely to encourage its repetition.
  3. Recognition can take many forms:
  • Personally congratulate an employee.
  • Send a handwritten note or an e-mail message.
  • “Bragging Boards,” etc.
  1. Employee Recognition Programs in Practice
  1. The highly competitive global economy has put most organizations under severe cost pressures, which is why recognition programs are particularly attractive. Recognizing an employee’s superior performance often costs little or no money.
  2. Employee recognition programs have experienced significant growth in popularity.
  3. Critics argue that these programs are susceptible to political manipulation by management. If abused, the value of recognition programs is undermined, leading to demoralized employees.

Employee Involvement Programs

  1. What Is Employee Involvement?
  1. Employee involvement has become a catchall term to cover a variety of techniques. It encompasses employee participation or participative management, workplace democracy, empowerment, and employee ownership.
  2. Employee involvement is a participative process that uses the entire capacity of employees and is designed to encourage increased commitment to the organization’s success.
  3. The underlying logic is that by involving workers in those decisions that affect them and by increasing their autonomy and control over their work lives, employees will become more motivated, more committed to the organization, more productive, and more satisfied with their jobs.
  1. Examples of Employee Involvement Programs
  1. Four forms of employee involvement are participative management, representative participation, quality circles, and employee stock ownership plans.
  2. Participative management:
  • The distinct characteristic common to all participative management programs is that subordinates actually share a significant immediate degree of decision-making power with their superiors.
  • It has been promoted as a panacea for poor morale and low productivity. However, it is not appropriate for every organization. For it to work, there must be adequate time to participate, the issues in which employees get involved must be relevant to their interests, employees must have the ability (intelligence, technical knowledge, communication skills) to participate, and the organization’s culture must support employee involvement.
  • Why would management want to share its decision-making power with subordinates?
  1. Managers often do not know everything their employees do.
  2. Better decisions
  3. Increased commitment to decisions
  4. Intrinsically rewarding employees makes their jobs more interesting and meaningful

Dozens of studies have been conducted but the findings are mixed. It appears that participation typically has only a modest influence on productivity, motivation, and job satisfaction.

  1. Representative participation: Almost every country in Western Europe has some type of legislation requiring it. It is the most widely legislated form of employee involvement around the world.
  • The goal is to redistribute power within an organization, putting labor on a more equal footing with the interests of management and stockholders.
  • The two most common forms:
  1. Works councils link employees with management. They are groups of nominated or elected employees who must be consulted when management makes decisions involving personnel.
  2. Board representatives are employees who sit on a company’s board of directors and represent the interests of the firm’s employees.
  3. In some countries, large companies may be legally required to make sure that employee representatives have the same number of board seats as stockholder representatives.
  4. The overall influence seems to be minimal. The evidence suggests that works councils are dominated by management and have little impact on employees or the organization.

If one were interested in changing employee attitudes or in improving organizational performance, representative participation would be a poor choice.

  1. Quality circles:
  1. Quality circles became popular in North America and Europe during the 1980s.
  2. A quality circle consists of a work group of eight to ten employees and supervisors who have a shared area of responsibility. Key components are:
  1. They meet regularly on company time to discuss their quality problems, investigate causes of the problems, recommend solutions, and take corrective actions.
  2. They take over the responsibility for solving quality problems and they generate and evaluate their own feedback.
  3. Management typically retains control over the final implementation decision.
  1. A review of the evidence indicates that they are likely to positively affect productivity, however, they tend to show little or no effect on employee satisfaction.
  2. QC’s seem to be a fad that has come and gone.
  1. First is the little bit of time (usually just an hour per week) that actually deals with employee involvement.
  2. Second, the ease of implementing quality circles often worked against them. The lack of planning and top-management commitment often contributed to quality circle failures.
  3. Employee stock ownership plans:
  1. Employee ownership can mean any number of things. Most common is ESOPs which are company-established benefit plans in which employees acquire stock as part of their benefits.
  2. In the typical ESOP, an employee stock ownership trust is created. Companies contribute either stock or cash to buy stock for the trust and allocate the stock to employees.
  3. Employees usually cannot take physical possession of their shares or sell them as long as they are still employed at the company.
  4. The research indicates that they increase employee satisfaction, but their impact on performance is less clear.
  1. The evidence consistently indicates that it takes ownership and a participative style of management to achieve significant improvements in an organization’s performance.

Instructor Note: At this point in the lecture you may want to introduce the POINT-COUNTER POINT – The Power of Stock Options As A Motivator found in the text and at the end of these chapter notes. A suggestion for a class exercise follows the introduction of the material.

  1. Linking Employee Involvement Programs and Motivation Theories

Employee involvement draws on a number of the motivation theories previously discussed:

  • Theory Y is consistent with participative management. Theory X aligns with the more traditional autocratic style of management.
  • Two-factor theory-employee involvement programs could provide intrinsic motivation.
  • Employee involvement is compatible with ERG theory and efforts to stimulate the achievement need.
  1. Employee Involvement Programs in Practice
  1. Germany, France, Holland, and the Scandinavian countries have firmly established the principle of industrial democracy in Europe. Other nations, including Japan and Israel, have traditionally practiced some form of representative participation.
  2. Participative management and representative participation were much slower to gain ground in North American organizations. Employee involvement programs that stress participation have become the norm.
  3. Employee involvement practices differ between countries. Practices need to be modified to reflect national culture.
  4. The names of companies that have used quality circles read like a Who’s Who of Corporate America. But the success of quality circles has been far from overwhelming. In recent years, many organizations have adopted more comprehensive team-based structures.

Job Redesign and Scheduling Programs

  1. What is job redesign and scheduling
  1. Ways to reshape jobs so that they are more challenging, stimulating, and motivating.
  2. Three Job redesign options-job rotation, job enlargement, and job enrichment
  • Job rotation – (sometimes referred to as cross-training). The practice of periodic shifting of an employee from one task to another.
    1. Reduces boredom and increases motivation
    2. Training costs are increased, productivity is reduced
  • Job enlargement – Expanding jobs horizontally.
    1. Efforts have met with less than enthusiastic results
    2. Some successful applications.
  • Job enrichment – refers to the vertical expansion of jobs. Increases the degree to which worker controls planning, execution, and evaluation of their work. (Exhibit 7-4).
    1. How does management enrich an employee’s job?
    • Combining tasks
    • Forming natural work units
    • Establishing client relationships
    • Expanding jobs vertically
    • Opening feedback channels
    1. Overall evidence indicates that job enrichment reduces absenteeism and turnover costs and increases satisfaction. Evidence is inconclusive on the issue of productivity.
    2. Flextime. (flexible work hours). Allows employees some discretion over when they arrive at and leave work. (Exhibit 7-5).
    • Benefits include reduced absenteeism, increased productivity, reduced overtime expense, and reduced hostility toward management, and increased autonomy and responsibility for employees.
    • Major drawback is that it’s not applicable to all jobs.
    1. Job sharing. Allows two or more individuals to split a traditional 40-hour a week job.
    2. Telecommuting. Employees who do their work at home at least two days a week on a computer that is linked to their office.
  • Self-Assessment Exercise

    Job Enrichment

    Instructor Note: Students should complete the Self-Assessment Exercise from SAL #19 “Do I Want an Enriched Job?” The results from this exercise directly relate to the chapter material.

    Students should consider the following after they have completed the exercises:

    • What did you find out about yourself in doing this exercise?
    • How can you use this information in helping you in the workplace?
    • Do you think this information will help you as a manager? How?

    Instructor Note: At this point in the lecture you may want to introduce the MYTH OR SCIENCE? “Everyone Wants a Challenging Job”” found in the text and at the end of these chapter notes. The discussion of the material will provide students the opportunity to discuss how managers should determine whether individuals desire more challenging jobs.

    MYTH OR SCIENCE? – Everyone Wants a Challenging Job

    This statement is false. In spite of all the attention focused by the media, academicians, and social scientists on human potential and the needs of individuals, there is no evidence to support that the vast majority of workers want challenging jobs. Some individuals prefer highly complex and challenging jobs; others prosper in simple, routinized work.

    The individual-difference variable that seems to gain the greatest support for explaining who prefers a challenging job and who doesn’t is the strength of an individual’s higher-order needs. Individuals with high growth needs are more responsive toe challenging work. But what percentage of rank-and-file workers actually desire higher-order need satisfactions and will respond positively to challenging jobs? No current data are available, but a study from the 1970’s estimated the figure at about 15 percent. Even after adjusting for changing work attitudes and the growth in white-collar jobs, it seems unlikely that the number today exceeds 40 percent.

    The strongest voice advocating challenging jobs has not been workers-it’s been professors, social-science researchers, and journalists. Professors, researchers, and journalists undoubtedly made their career choices, to some degree, because they wanted jobs that gave them autonomy, identity, and challenge. That, of course, is their choi


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