Motivation In The Modern Business World Commerce Essay

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Motivation is the word found only in successful people. It is thought that, motivation is an intense commitment of doing something, or it is a willingness to engage in particular set of activities. For instance, an employee who regularly spends half an hour more than his official job timings to finish work without being rewarded through overtime is said to be highly motivated. It is also common to believe that only few people have motivation, while others do not have it. However, the scholars across social sciences, such as Sociology, Psychology, and management sciences, have viewed, defined, and theorized about motivation somewhat differently from the conceptions of laymen. Practitioners of social sciences view motivation as a force that energizes a behavior.

Motivation is a drive, or a force that activates behaviors. Motivation makes it possible for humans to perform tasks consistently over period of time. For instance, Typist whose lifelong work is to type and type must have a degree of motivation; otherwise he won't be able to maintain quality of his work. Contrary to the beliefs held by a lay person about motivation, scholars of social sciences argue that motivation is not limited to successful people. They contend that motivation is found in every human being.

The factors that make an individual motivated are different. For example, some employees work hard to earn a promotion, while others value appreciation of managers, and of fellow workers. Motivation is not a behavior, nor is it a level of performance. Motivation is an inner trait that triggers human actions, and behaviors, in order to satisfy a need, or achieve a goal. For instance, many employees work hard to receive a pay rise in order to better fulfill their economic needs.

Motivation Definition:

Motivation is a complex phenomenon which is influenced of individual, cultural, ethnic and historical factors. According to De Cen zoetal, (1996), people who are motivated use a greater effort to perform a job than those who are not motivated. Motivation can be defined as "a series of energizing forces that originate both with and beyond an individual's. These forces determine the person's behaviour and therefore, influence his/her productivity (Jackson, 1995). In other words this means that all thinkable factors of physical or psychological aspects that we interact with, leads to a reaction within our self or of the entire organization

The literature offers several competing yet complimentary definition of motivation. These definitions use words like "need", "wish", "incentive", "drive", "desires", "motive", and "goals". It is describe the nature of motivation, as a force having an inherent capacity to trigger human behaviors. In other words, individuals opt to behave in a certain way, in an attempt to fulfill a need, or to satisfy a wish, or to get benefits of an incentive. In the following lines we shall highlight some definitions of motivation.

Tesco Background:

Tesco began in 1919 with one man, Jack Cohen, a market stallholder selling groceries in London. TESCO was formed out of a merger with T.E. Stock well from whom he purchased tea for sale on the stall. The first store opened in 1929.

Since then, Tesco has expanded across the world. It now has over 2,200 stores including hypermarkets and Tesco Express outlets to meet different customer needs. As a conglomerate, Tesco also offers alternative goods and services such as insurance, banking and online shopping. With net profits of around £3.4 billion Tesco has become the largest British retailer and one of the world's leading retail outlets on three continents. Tesco's growth has resulted in a worldwide workforce of over 468,000 employees.

To support its growth, Tesco needs staff that are motivated, flexible and well trained and who recognize customer needs. In turn, Tesco's employees are supported by the company in their various roles and at different levels - from customer assistants in stores to department managers; from warehouse employees to office and logistics staff. Tesco recognizes that employee motivation is important for the continued growth of the company.

This case study looks at how Tesco motivates its employees by increasing their knowledge, skills and job satisfaction through training and development and providing relevant and timely reward and recognition.

Employee Motivation at Tesco:

Motivation may stem from personal interest such as keeping safe or from external factors such as praise and reward. Different theories have been suggested for motivating employees. Pay is considered a primary motivator. Other motivating factors include:

appreciation of hard work

a sense of achievement

responsibility and empowerment

opportunity for advancement

A sense of challenge and enjoyment.

Benefits of motivated staff:

A motivated workforce will work harder and achieve greater output in less time, therefore reducing labour costs. It requires less supervision and demonstrates pride in its work, making a greater impact on the customer. Motivated employees have greater concentration and are less likely to make mistakes, cause accidents or be involved in conflict. They are also likely to show greater loyalty to the company and have less absenteeism. An unmotivated workforce will be the opposite, being dissatisfied with its role in the work environment. This can negatively affect both the quality of the work as well as how efficiently employees carry out their jobs.

Tesco considers that the business depends on two groups of people - customers and staff. It appreciates that staff are unique and have diverse lifestyles outside of work. To this end Tesco supports staff with a work/life balance and offers reward through:

flexible working

free or reduced rate health benefits

discount gym membership

competitive salaries

staff discount

Company share options.

Valuing employees:

Tesco has discovered that it is important to create trust and respect. It has found that by valuing employees, providing realistic goals and an interesting environment for them to work in, it increases employees' motivation. At Tesco, a motivated member of staff 'works in partnership with others to achieve individual and team objectives'. This means that he or she focuses on customers, treats people fairly and is determined and devoted to receiving feedback from others.

Taylor's motivational theory:

In 1911 the engineer Frederick Taylor published one of the earliest motivational theories. According to Taylor's research, people worked purely for money. In the early years of the car assembly industry, work on a production line was based on producing quantity and was repetitive. Workers were paid 'piece rate', that is, paid for every item produced. This approach of paying workers by results was good for the business. The outcome was greater production but gave little opportunity, encouragement or time for employees to think for themselves or be creative in what they did. This limited people's development and their use within the company.

Employee rewards:

Tesco's Employee Reward Programmed has some similarity to Taylor's theory. Its financial reward packages are one motivating factor. However, there are factors other than money which motivate people in both their personal and working lives.

Tesco goes far beyond Taylor and gives more than just simple pay increases. It supports the varied lifestyles of individual employees through relevant and targeted benefits.

Many non-financial factors can and do motivate employees to improve their output. One such factor may be the desire to serve people; others may be to improve personal skills or achieve promotion. A person may be motivated to be a professional footballer not because of the salary but because they love football.

Employees are more motivated if they feel content in their work. This often happens when their employer creates a good working environment where employees feel valued, generally through increased communication and being asked for their opinions. Employee motivation is also likely to be higher if the organization invests in its staff through training and development. In turn, this enhances their knowledge, skills and their sense of job satisfaction.

Measuring staff satisfaction:

Every year Tesco invites its staff to take part in a staff satisfaction survey called Viewpoint which gives them the opportunity to express their views on almost every aspect of their job. The results from the survey help Tesco make sure it is offering the right things to its staff to keep them motivated. Some of the benefits available to staff include:

Lifestyle breaks - this offers 4-12 weeks off work and guarantees the job back at the end

Career break - this allows staff between 6 months and 5 years away from work with right of return

Pension scheme - this award-winning scheme provides clearly defined long-term benefits.

The Mayo effect:

Internal or external factors may motivate a person to change or develop their actions. For example, an internal factor may be the desire to learn a new skill. This would reward the individual. External factors include, for example, sales targets and incentives. A more negative motivator might be no pay rise if targets are not achieved.

In the early 1930s, the theorist Elton Mayo suggested that motivation at work was promoted by such factors as:

Greater communication

Good teamwork

Showing interest in others

Involving others in decision making

Ensuring the wellbeing of others

Ensuring work is interesting and non-repetitive.

Mayo based his assumptions on research undertaken with workers at the Hawthorne plant of the Western Electric Company in Chicago. His work resulted in the Hawthorne theory. He suggested that boredom and repetitiveness of tasks led to reduced motivation. He believed that motivation was improved through making employees feel important, giving them a degree of freedom to make choices and acknowledging their social needs.


At Tesco the Mayo theory is seen to be operating throughout the company. Communication is an extremely important factor in motivating employees. This may be through 1-to-1 discussions with managers, through the company intranet or newsletters or through more formal structures such as appraisals. Line managers hold a daily Team Meeting to update staff on what is happening for the day and to give out Value Awards. These awards can be given from any member of staff to another as a way of saying 'thank you' and celebrating achievements.

Motivation from training and development:

Tesco also promotes motivation through its many training and development opportunities. Everyone has access not just to the training they need to do their job well but also to leadership training to grow within the company.

Tesco offers strategic career planning to help staff 'achieve the extraordinary'.

In 2009 Tesco appointed 3,000 managers - 80% internally. As well as an annual career discussion with every employee, the company also emphasizes the development of the whole person and has implemented a system of 360 degree feedback. This is a personal development tool, which provides feedback from a selection of people with whom the employee works. This helps employees to understand their behavior, strengths and weaknesses within the workplace as others see them. The idea of the programme is to 'Take People with You' and 'To Gain the Hearts and Minds of Others' in order to improve individuals and get things done efficiently.

Personal development plans:

All Tesco employees have a Personal Development Plan which they build through their 360 degree feedback and other tools. This enables Tesco managers to offer meaningful feedback to employees to help provide opportunities for continuous personal development. This personal approach helps employees to reach their full potential by encouraging self-assessment and providing advancement through ongoing training. It also enables individuals to take responsibility for their development. This two-way relationship ensures that the employee is committed to the values of the company, that he or she works in partnership with others and helps improve the business for customers.

Leadership of Tesco:

Tesco's mission statement is "creating value for customers to earn their lifetime loyalty". There are two values which fuel Tesco's operations and business decisions. These are (1) no one tries harder for customers and (2) treat people how we like to be treated. From these values, the visions of the company were created. The visions focus on customers and the company's people. The company intends to be better than any organization in understanding the customers. The company also endeavors to provide better products and services as well as become the most innovative company in terms of products and services. The objectives of the company centers on the philosophy that if they look after customers well and operate efficiently and effectively then shareholders' interests will always be best served by the inevitable outputs of those - growth in sales, profits and returns (Tesco PLC 2009). Thus, it can be said that the objectives of the company are

(1) Growth in sales, profits and returns, (2) satisfy the customers and gain their loyalty

by providing quality products and services, and (3) satisfy its shareholders/stakeholders

(Tesco Annual Report, 2008; Tesco Annual Report, 2009)

Maslow and Herzberg:


Abraham Maslow argued that humans are motivated by five essential needs. He formed a pyramid demonstrating these needs which he called the 'hierarchy of needs': At the bottom of the pyramid are basic needs, those that motivate people to work - food and shelter. Once these needs are met through pay, individuals want safety and security through, for example, good job conditions. Social needs refer to the need to belong, to be part of a group. Self-esteem may arise from a promotion. Right at the top is Self-fulfillment- the area for creativity, challenge and interest. Maslow suggested that achieving one level motivates us to achieve the next.


In 1959, Frederick Herzberg developed the Two-Factor theory of motivation. His research showed that certain factors were the true motivators or satisfiers. Hygiene factors, in contrast, created dissatisfaction if they were absent or inadequate. Dissatisfaction could be prevented by improvements in hygiene factors but these improvements would not alone provide motivation. Herzberg showed that to truly motivate an employee a business needs to create conditions that make him or her feel fulfilled in the workplace.

Tesco aims to motivate its employees both by paying attention to hygiene factors and by enabling satisfiers. For example, it motivates and empowers its employees by appropriate and timely communication, by delegating responsibility and involving staff in decision-making. It holds forums every year in which staff can be part of the discussions on pay rises. This shows recognition of the work Tesco people do and rewards them. Tesco staff can even influence what food goes onto its restaurant menus. Employees thus become motivated to make choices that will increase their use of the restaurants.

Part 2:

Culture, Management and leadership styles to achieve a highly motivated work force:


Management includes organizing, planning, controlling, staffing and directing. It is not just the definition of the management, but human has always been doing these managements techniques in different options and at different situations. Typically, management was judged as the art to manage the men and then it converted to the term "manage-men-t". To find the usage of the knowledge available, management is considered as the delivery of knowledge, hence this is done to get better and expected results ( 2010).

Management is not only resourceful but also it runs with a proper system, the information and knowledge can be applied in a very productive manner for the purpose of producing expected results. Management has many branches such as management of marketing, management of finance, management of time and some others such as management of operations and catastrophe, management of strategy etc. these all are individual branches for which the managers has to especially study about these branches. Along with other things, management has certain factors as well, which affect the successful performance of the organisations ( 2010).

Leadership of Tesco:

Leaders should create a safe, inspiring environment based on the world situation and employees at Tesco are able to participate, have good communication and the ability to influence work at the company. There are three bases in which the success of Terry Leahy's leadership is founded. These are legitimate power, expert power and referent power. Legitimate power stems from an individual's position within an organization and their right to require and demand compliance from subordinate. Legitimate power is a formal authority delegated to the holder of the position. Legitimate power was achieved by Leahy when he ascended as the CEO of Tesco. Through his position, he is able to lead the company's people. Expert power may include communications, interpersonal skills, and scientific knowledge and so on. Such expertise is very valuable but specific to a task. It is based on the perception of the leader's ownership of distinct superior knowledge, expertise, ability or skill. Terry Leahy immediately joined Tesco straight after graduating from the University of Manchester Institute of Science and Technology (UMIST) in 1979. He entered the supermarket chain as a marketing executive, was appointed to Tesco's board of directors in 1992 and by the time he was 40 he had worked his way up to become chief executive in 1997. His wide experience in the company makes him very knowledgeable of the company, its customers, and its operations. His years of experience in the company make him a possessor of valuable knowledge of the company, its operations, customers and industry. Referent power is based on group member's identification with, attraction to, or respect for the leader. It is a leader's charisma and interpersonal skills which causes subordinates to gain a sense of intrinsic personal satisfaction from the identification of being an accepted follower. Leahy is a very popular leader among his follower. This is because he motivates them and constantly empowers them. He is also charismatic.

Recognition of superior performance:

It is essential that a well-performing employee is recognized for his or her work. By informing an employee that he or she is doing well, management can increase the morale of him or her. Several methods can be adopted to reward good performing employees. These methods can be tangible e.g. money, in form of a bonus, or a salary raze. This reward can be intangible e.g. verbal appreciation of that employee. Recognition of performance has an impact on not only the employee who is performing well; it also tells other employees that they should also improve their performance.

Introduce healthy competition in the organization.

One another technique that management or managers can use to motivate employees is to introduce healthy competition in the organizations. These competitions can be of several types. For instance, a manager can give a same amount of work to two employees, and inform them that they must finish their work before the other. Also they can do the same with two teams of employees. Also management can start a competition on who is the most punctual employee? And who have completed most tasks within a timeframe of suppose one month. However management should remain conscious of the fact that this competition should not take a form of conflict. This can be ensured by not offering very high rewards to the employees who have done well in the competitions.

For example, offering a Ten percent salary raze for the employee who has been most punctual in one month, may create an air of jealousy, and conflict in the organization. This is something that an organization must avoid at all costs.

Impacts of Leadership Styles on the Organization and Its Sub-Units

There are two types of leadership that I want to discuss. These are autocratic and participative leaderships. In an autocratic style of leadership, the group or organization is managed under the authoritarian leader. The participative leader on the other hand, possesses the same power as the autocratic one. However, a participative leader chooses to exercise his power differently during the policy-making and work-role assignment phases of the group action. The appointment of Terry Leahy as the CEO of Tesco marked a new era for the company. Leahy adapted a participative style of leadership wherein the employees are given voice in the decision-making process. The CEO also gives emphasis on the importance of appointing many leaders to handle organizational process. The organizational structure therefore became more flat where the roles and responsibilities of everyone are clearly stated. Leahy delegates leadership roles to individuals in the organization in order to ensure that the company, with more than 300,000 employees, operates effectively. The leadership style that is manifested by Terry Leahy and is imitated by the leaders in the company has changed the structure of the company. The company has adapted an organic form of organization. An organic system is characterized by low to moderate use of formal rules and regulations, decentralized and shared decision making, broadly defined job responsibilities, and a flexible authority structure with fewer levels in the hierarchy. An organic structure is more appropriate to those organizations where there is a need to be innovative. The pressure of innovation suggests a structure that can respond to environmental variations rapidly so it is necessarily loosely defined and flexible. The organization tends not to be formalized nor is roles too closely structured. Organic organizations are stratified primarily in terms of expertise, and leadership accrues to those who are the best informed and capable.


Employee motivation is an important task for managers. Early motivational theory such as that of Taylor suggested that pay motivated workers to improve production. However, businesses now need employees to have greater motivation and have a stake in the company for which they work, as shown by Mayo. Maslow and Herzberg demonstrated that employees are motivated by many different factors.

Tesco provides opportunities for its managers and staff to take a share and a greater interest in their own employment. Since every employee is an individual, with different needs and aspirations, the process of reviews and personal development plans allows recognition of their abilities and achievement, as well as potential development.

This benefits the individual by providing career progression. It also benefits Tesco by ensuring the business can deliver high levels of customer service through its skilled employees.