Every organization has a very important resource which needs to be maintained in a unique way-the human resource. Money is thought to be the main motivator for this resource, however, that is not the case as is presented in the case study 'Joy of Giving'.
Human behavior, actions and reactions cannot be predicted as easily as other resources for organizations, for example, machines, therefore it becomes harder to manage them. There are a lot of factors which affect the way humans work, the environment, the rewards, the salary, the affiliations, the challenges they face, the job security, the growth opportunities, etc. Joy of Giving talks about the importance of small rewards which motivates employees of the organization and makes them feel an important part of the organization. It also talks about how detached checks and bonuses are sometimes not sufficient to make employees really appreciated.
The reasons that humans work is due to the motivation they have to work, these motivators might vary from person to person or even if the main motivators are the same, the level of importance changes of each motivator changes. Motivators are defined as factors that maybe internal or external, which stimulate employees to be interested in the job and continue with the work to achieve the goals and tasks set out to them. Motivators may be the result of a desire for something, a reward for achieving that goal or to fulfill expectations of that employee.
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Due to the importance of the need for motivation for employees, there has been much discussion on this topic by scholars and many theories have been formulated for better understanding of this topic. However, we will discuss the motivational theories which are in favor of the gift giving behavior which has been highlighted in the 'joy of giving' case study.
There is a theory of Operant Conditioning, which can be viewed in the running of organizations like IT Lab Limited. IT Lab Limited believes that instead of companies giving out increases in numbers which usually go unnoticed; it gives a special recognition to the hard work of the employees by giving them small gifts like champagne, or vouchers. According to It Lab Limited, such gifts excite the employees more than other benefits. Such actions on behalf of the company are a way to reinforce positive actions in the employees.
Operant Conditioning is when the situations are monitored with a few factors being changed deliberately and the result is the behavior that was intentionally brought about. There are four methods that Operant Conditioning uses to bring about the required behavior- positive reinforcement, negative reinforcement, positive punishment and negative punishment.
Positive reinforcement is used to reinforce the behavior that is wanted by the organization. For example, the organization will reward the employees when they display a behavior which will lead to the achievement of the organizational goals in an efficient and effective manner. This may be the employees achieving the tasks assigned to them in less time than what was allotted to them, or they may have used fewer resources to get the result as initially forecasted. In such circumstances, the organization follows such a behavior with a desired reward by the employees to encourage them into continuing with such behavior in the future as well. On the other hand, Negative Reinforcement is used to encourage certain behavior of the employees, therefore, so when an employee displays an act which may not be wanted by the organization, the action is followed by a negative stimulus to ensure that the employees knows of the undesirability of the act. Negative reinforcement can be of the removal of the health insurance benefit when the employee is unable to perform well on the job and the removal of insurance would continue till the employee is able to achieve the standard behavior on the job.
The other kind of theory that comes in Operant Conditioning is the Positive Punishment, which discourages the employees from doing an act. For example, the employee who is unable to meet the standards of the job might be reprimanded by the supervisor or not get the bonus s/he usually gets every month. Such actions are taken by the organization to inform the employee of the undesirability of the act, to ensure that such behavior is not repeated. Same concept is followed in Negative Punishment, which is also used to discourage unwanted behavior. This however takes away something desired by the employees to convey to that such behavior should not happen again.
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IT Lab Limited uses the Positive Reinforcement factor by encouraging the wanted behavior of the employees at workplace by recognizing their work and awarding them with special gifts to motivate them and egg on such behavior. They believe that tulips given to an employee at times are better than the insurance given to the employee.
Above mentioned are the ways an organization can encourage, discourage behaviors in the workplace, however, there are some factor which when present may not motivate the employees but their absence leads to de-motivation. This theory is known as Two Factor Theory (Herzberg, 1959) and talks about the factors which lead to job satisfaction. The presence of the factors in the Two Factor theory does not add much value when these are present, but can cause damaging effects to the morale of the employees and can cause productivity and motivation to decrease when they are not present. The factors have been divided into two categories-motivators and hygiene factors.
Motivators are those aspects of the work which make the employee satisfied with the job that s/he is doing. There may be different things that different people might prefer, and the level of desire might be different, but for most people these factors remain the same. This may include the safety in the work environment for some, the kind of people and exposure one gets from the work for others and some might want growth and development from the job, if these are not present for the people who prefer them, it was cause their morale and productivity to fall as they are not receiving something they believe in. The other factor is the Hygiene Factor which includes the more materialistic factors that one would look in a job, for example, the monetary benefits, the fringe benefits, the status and the class.
The major learning from the Two Factor Theory is being displayed by the Joy of Giving is that employees do not only want the monetary reward from a job, there are many other factors which contribute to the job satisfaction of an employee which leads to high productivity and high morale. As David Tong said in Joy of Giving 'Small gifts have a powerful effect. This effect can be disproportionate to their value when they are viewed by the recipient as the recognition of a job well done or a special effort madeâ€¦However the act of giving is a strong, almost ceremonial way to provide recognition to the employees." This is displayed in the Peppermint PR company which recognizes their employees with wine, vouchers for meals, etc. Peppermint PR is a public relations company where the employees have to represent not only their own company, but the clients of the company as well, therefore, the importance of the behavior of the employees becomes even more critical. The organization then needs to recognize every employee who does more than the required because of the sensitive nature of the work and the dedication that is needed in the work and Peppermint PR does exactly this by singling out employees for praise and appreciation of their work.
As has been discussed above, one thing that can be concluded from the studies presented above is that the employees have various kinds of needs which need to be fulfilled in order to keep the employees satisfied with their job and the organization that they work for. These needs have been categorized as existence needs, relatedness and growth needs in the ERG Theory (Alderfer & Schneider, 1973). These needs refer to the different levels of needs that an employee might have. Existence needs are about the essential needs of an employee that would be required for him/her to work. Along with the basic needs, the social aspect is also important where the employee craves for affiliation in their work environment; such needs are categorized under Relatedness needs. Along with basic needs and the need to be a part of a social group, there are needs which refer to the desire of achieving something, or challenge in the work. This is called the Growth needs. The gift giving behavior in Joy of Giving is fulfilling the Growth needs of the employee as it is a way of acknowledging the work of the employee and rewarding him/her for the tasks that have been accomplished in an exceptional manner.
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Growth needs of the employee will be fulfilled if companies like Peppermint PR continue to acknowledge and reward the employees for their hard work in the special manner which singles them out and is not a generic way of acknowledging everyone at the same time. Such individual recognition will continue to motivate the employees and provide the positive reinforcement that is needed.
Rewards are given by companies to the employees to recognize and appreciate their hard work that leads the companies towards achieving their organizational goals. Reward when simply defined is the return one gets on some work done by them. The reward that the employee gets should be equivalent of the work that was done; the equivalence does not necessarily have to be in price value of the reward, but in the meaningfulness of the reward.
Till some years ago it was a widespread belief that people work for money, however, in some studies done in the last decade prove that the employees do not only work for money they also need other things from their work which cannot only be paid through a check (Pffeffer 1998). This was proven in the many studies discussed above, the ERG theory, the Two Factor Theory and the Operant Conditioning. However, the method that is described in Joy of Giving may not be the way to cater to the growth needs, to motivate the employees and to provide the positive reinforcement.
Joy of Giving talks about giving small gifts to employees as a token of appreciation and recognition. This method would not be able to raise the employees' morale if the gifts that are given to the employees have no value to the employees. If these gifts hold no meaning to the employees and other people around them, the rationale for such act would not be effective at all and would have an adverse effect of reducing the employee's productivity and morale. As the company Metaswitch believes that those gifts should be given which are standard, this is an example of such a reward not having the same meaning to the employee as the organization would want it to.
Another factor that plays a role in the effectiveness of the reward strategy employed by companies like Bravissimo is the timing of the rewards that are handed out to the employees. If these gifts are given to many employees and many times, the effectiveness of the meaning of the reward will be at stake and the value of the gesture will be lost on the employees. Like Bravissimo follows the strategy of giving little gifts to the employees and often, therefore, they should reduce the number of times the gifts are given for the reward to hold its significance.
Politics is another factor in the office which plays an important role in the way an organization runs. The productivity of the employees is also highly dependent on the way the employees perceive the level of politics in their work environment. If the employees feel that the gifts are being given to the favorites of the top management of the company, their morale to excel and achieve that level of work will decrease. In such cases they would lose any motivation to work harder than what is required of them.
Hawthorne Studies did an experiment and the conclusion of that experiment was that material gifts do not always increase motivation and productivity and there are other factors like work environment which play an important role in job satisfaction. It was proven that if the work environment is not appropriate for the workers, the number of gifts given to the employees, or benefits added to their salary would not be able to motivate the employee (Mayo 1932).
A part of the work environment is the self esteem of the employees, and if they are not being made to feel an important part of the organization and that the work that they are doing is effectively working towards achieving the goals of the organization, their productivity is going to fall and no gifts are going to effectively increase their job satisfaction.
Gift giving as described in Joy of Giving is an effective tool for recognizing the efforts of the employees, however, at times there is a need for more strategic methods than to just give gifts. As seen in the Hawthorne Studies, other factors are also important, and as discussed above the timing and the quantity of gifts given will also lead to the effectiveness of the reward strategy adopted by the company. Therefore, having the gift giving strategy alone in the company is not going to be very effective, and other factors also need to be taken into consideration for effective results.