04 Langton Fob 3ce Ch04

Chapter 4, Nancy Langton and Stephen P. Robbins, Fundamentals of Organizational Behaviour, Third Canadian Edition 4-1Copyright © 2007 Pearson Education Canada

Chapter 4

Motivating Self and Others


Chapter Outline

• Defining Motivation

• Needs Theories of Motivation

• Process Theories of Motivation

• Responses to the Reward System

• Creating a Motivating Workplace: Rewards and Job Design

• Evaluating the Use of Rewards in the Workplace


Theories of Motivation

1. What is motivation?2. How do needs motivate people?3. Are there other ways to motivate people?4. Do equity and fairness matter?5. How can rewards and job design motivate

employees?6. What kinds of mistakes are made in reward

systems?


What Is Motivation?

• Motivation– The intensity, direction, and persistence of effort

a person shows in reaching a goal:• Intensity: How hard a person tries

• Direction: Where effort is channelled

• Persistence: How long effort is maintained


Theory X and Theory Y• Theory X

– Assumes that employees dislike work, will attempt to avoid it, and must be coerced, controlled, or threatened with punishment if they are to perform.

• Theory Y– Assumes that employees like work, are creative, seek

responsibility, and can exercise self-direction and self-control.


Motivators

• Intrinsic Motivators– A person’s internal desire to do something, due

to such things as interest, challenge, and personal satisfaction.

• Extrinsic Motivators– Motivation that comes from outside the person

and includes such things as pay, bonuses, and other tangible rewards.


Needs Theories of Motivation

• Basic idea– Individuals have needs that, when unsatisfied,

will result in motivation • Maslow’s Hierarchy of Needs Theory

• ERG Theory

• McClelland’s Theory of Needs

• Motivation-Hygiene Theory


Maslow’s Hierarchy of Needs• Physiological

– Includes hunger, thirst, shelter, sex, and other bodily needs.

• Safety– Includes security and protection from physical

and emotional harm.

• Social– Includes affection, belongingness, acceptance,

and friendship.


Maslow’s Hierarchy of Needs

• Esteem– Includes internal esteem factors such as self-

respect, autonomy, and achievement, and external esteem factors such as status, recognition, and attention.

• Self-actualization– The drive to become what one is capable of

becoming; includes growth, achieving one’s potential, and self-fulfillment.


Exhibit 4-1

Physiological

Safety

Social

Esteem

Self-actualization


Alderfer’s ERG Theory

• Existence– Concerned with providing basic material

existence requirements.

• Relatedness– Desire for maintaining important interpersonal

relationships.

• Growth– Intrinsic desire for personal development.


McClelland’s Theory of Needs

• Need for achievement– The drive to excel, to achieve in relation to a set of

standards, to strive to succeed.

• Need for power– The need to make others behave in a way that they would

not have behaved otherwise.

• Need for affiliation– The desire for friendly and close interpersonal

relationships.


Herzberg’s Motivation-Hygiene Theory

• Hygiene factors – the sources of dissatisfaction– Extrinsic factors (context of work)

• Company policy and administration

• Unhappy relationship with employee’s supervisor

• Poor interpersonal relations with one’s peers

• Poor working conditions


Herzberg’s Motivation-Hygiene Theory

• Motivators – the sources of satisfaction – Intrinsic factors (content of work)

• Achievement

• Recognition

• Challenging, varied, or interesting work

• Responsibility

• Advancement


Comparison of Satisfiers and Dissatisfiers

Source: Reprinted by permission of Harvard Business Review. An exhibit from Frederick Herzberg, “One More Time: How Do You Motivate Employees?” Harvard Business Review 81, no. 1 (January 2003), p. 90. Copyright © 1987 by the President and Fellows of Harvard College; all rights reserved.


Exhibit 4-2 Contrasting Views of Satisfaction and Dissatisfaction


Criticisms of Motivation-Hygiene Theory

• The procedure that Herzberg used is limited by its methodology.

• The reliability of Herzberg’s methodology is questioned.

• Herzberg did not really produce a theory of motivation.

• No overall measure of satisfaction was used.

• The theory is inconsistent with previous research.


Exhibit 4-3 Relationship of Various Needs Theories

HygieneFactors

Need for Achievement

Need for Power

Need for Affiliation

Self-Actualization

Esteem

Affiliation

Security

Physiological

Motivators

Relatedness

Existence

Growth

Maslow Alderfer Herzberg McClelland


Summary: Hierarchy of Needs

– Maslow: Argues that lower-order needs must be satisfied before one progresses to higher-order needs.

– Herzberg: Hygiene factors must be met if person is not to be dissatisfied. They will not lead to satisfaction, however. Motivators lead to satisfaction.

– Alderfer: More than one need can be important at the same time. If a higher-order need is not being met, the desire to satisfy a lower-level need increases.

– McClelland: People vary in the types of needs they have. Their motivation and how well they perform in a work situation are related to whether they have a need for achievement, affiliation, or power.


Summary: Impact of Theory

– Maslow: Enjoys wide recognition among practising managers. Most managers are familiar with it.

– Herzberg: The popularity of giving workers greater responsibility for planning and controlling their work can be attributed to his findings. Shows that more than one need may operate at the same time.

– Alderfer: Seen as a more valid version of the needs hierarchy. Tells us that achievers will be motivated by jobs that offer personal responsibility, feedback, and moderate risks.

– McClelland: Tells us that high need achievers do not necessarily make good managers, since high achievers are more interested in how they do personally.


Summary: Support and Criticism of Theory

– Maslow: Research does not generally validate the theory. In particular, there is little support for the hierarchical nature of needs. Criticized for how data were collected and interpreted.

– Herzberg: Not really a theory of motivation. Assumes a link between satisfaction and productivity that was not measured or demonstrated.

– Alderfer: Ignores situational variables.– McClelland: Mixed empirical support, but theory is consistent

with our knowledge of individual differences among people. Good empirical support, particularly on needs achievement.


Process Theories of Motivation

• Look at the actual process of motivation– Expectancy theory

– Goal-setting theory


Expectancy Theory

• The theory that individuals act depending on whether their effort will lead to good performance, whether good performance will be followed by a given outcome, and whether that outcome is attractive to them.


Expectancy Relationships

• The theory focuses on three relationships:– Effort-Performance Relationship

• The perceived probability that exerting a given amount of effort will lead to performance

– Performance-Reward Relationship • The degree to which the individual believes that performing at

a particular level will lead to a desired outcome

– Rewards-Personal Goals Relationship • The degree to which organizational rewards satisfy an

individual’s personal goals or needs and are attractive to the individual


Exhibit 4-5 How Does Expectancy Theory Work?

Expectancy

Effort Performance Link

E=0

No matter how much effort I put in, probably not possibleto memorize the text in 24 hours

Instrumentality

Performance Rewards Link

I=0

My professor does not looklike someone who has $1 million

Valence

Rewards Personal Goals Link

V=1

There are a lot of wonderful things I could do with $1 million

My professor offers me $1 million if I memorize the textbook by tomorrow morning.

Conclusion: Though I value the reward, I will not be motivated to do this task.


Exhibit 4-6 Steps to Increasing Motivation, Using

Expectancy TheoryImproving Expectancy

Improve the ability of theindividual to perform

• Make sure employees have skills for the task• Provide training• Assign reasonable tasks and goals

Improving Instrumentality Improving Valence

Increase the individual’s belief that performance will lead to reward

• Observe and recognize performance• Deliver rewards as promised• Indicate to employees how previous good performance led to greater rewards

Make sure that the reward ismeaningful to the individual

• Ask employees what rewards they value• Give rewards that are valued


Goal-Setting Theory• The theory that specific and difficult goals lead

to higher performance.– Goals tell an employee what needs to be done and how

much effort will need to be expended.• Specific goals increase performance.

• Difficult goals, when accepted, result in higher performance than do easy goals.

• Feedback leads to higher performance than does nonfeedback.

– Specific hard goals produce a higher level of output than does the generalized goal of “do your best.”

• The specificity of the goal itself acts as an internal stimulus.


How Does Goal Setting Motivate?

• Goals:– Direct attention

– Regulate effort

– Increase persistence

– Encourage the development of strategies and action plans


Goals Should Be SMART

• For goals to be effective, they should be SMART:– Specific

– Measurable

– Attainable

– Results-oriented

– Time-bound


Exhibit 4-7 Locke’s Model of Goal Setting

Regulating effort

Increasing persistence

Encouraging the developmentof strategies and action plans

Taskperformance

Directing attention

Goalsmotivate

by . . .

Source: Adapted from E. A. Locke and G. P. Latham, A Theory of Goal Setting and Task Performance (Englewood Cliffs, NJ: Prentice Hall, 1980). Reprinted by permission of Edwin A. Locke.


Contingency Factors in Goal Setting

• Self-efficacy– An individual’s belief that he or she is capable of

performing a task.


Responses to the Reward System

• Equity Theory

• Fair Process and Treatment

• Cognitive Evaluation Theory


Exhibit 4-8Equity Theory

Person 1

Inequity, underrewarded

Equity

Inequity, overrewarded

Ratio of Output to Input

Person 2

Person 1

Person 2

Person 1

Person 2

Person 1’s Perception


Equity Theory• Main points:

– Individuals compare their job inputs and outcomes with those of others and then respond so as to eliminate any inequities.

– Equity theory recognizes that individuals are concerned not only with the absolute amount of rewards for their efforts, but also with the relationship of this amount to what others receive.


Responses to Inequity

• Change their inputs.

• Change their outcomes.

• Adjust perceptions of self.

• Adjust perceptions of others.

• Choose a different referent.

• Leave the field.


Fair Process and Treatment

• Historically, equity theory focused on– Distributive justice.

• However, equity should also consider– Procedural justice.


Fair Process and Treatment

• Distributive Justice– Perceived fairness of the amount and allocation of

rewards among individuals.

• Procedural Justice– Perceived fairness of the process used to determine the

distribution of rewards.

• Interactional Justice– The quality of the interpersonal treatment received from a

manager.


Cognitive Evaluation Theory

• The introduction of extrinsic rewards for work effort that was previously rewarded intrinsically will tend to decrease the overall level of a person’s motivation.


Motivators

• Intrinsic– A person’s internal desire to do something, due

to such things as interest, challenge, and personal satisfaction.

• Extrinsic – Motivation that comes from outside the person,

such as pay, bonuses, and other tangible rewards.


Four Key Rewards to Increase Intrinsic Motivation

1.Sense of choice

2.Sense of competence

3.Sense of meaningfulness

4.Sense of progress

Managers can act in ways that will build these intrinsic rewards for their employees.


Exhibit 4-9 Building Blocks for Intrinsic Rewards

• Delegated authority

•Trust in workers

• Security (no punishment) for honest mistakes

• A clear purpose

• Information

• A noncynical climate

• Clearly identified passions

• An exciting vision

• Relevant task purposes

• Whole tasks

• Knowledge

• Positive feedback

• Skill recognition

• Challenge

• High, non-comparative standards

• A collaborative climate

• Milestones

• Celebrations

• Access to customers

• Measurement of improvement

Leading for Choice Leading for Competence

Leading for Meaningfulness Leading for Progress

Source: Reprinted with permission of the publisher. From Intrinsic Motivation at Work: Building Energy and Commitment. Copyright © K. Thomas. Berrett-Koehler Publishers Inc., San Francisco, CA. All rights reserved. www.bkconnection.com.

http://www.bkconnection.com/


Employee Recognition

• Employee recognition programs use multiple sources and recognize both individual and group accomplishments.

• In contrast to most other motivators, recognizing an employee’s superior performance often costs little or no money.


Variable-Pay Programs

• A portion of an employee’s pay is based on some individual and/or organizational measure of performance.– Individual-based

• Piece-rate wages, bonuses

– Group-based• Gainsharing

– Organizational-based• Profit sharing• Employee stock ownership plans (ESOPs)


Variable Pay Programs: Individual-Based Incentives

• Piece-rate pay plans– Employees are paid a fixed sum for each unit of

production completed.

• Bonuses– One-time rewards for defined work rather than

ongoing entitlements.


Variable Pay Programs: Group-Based Incentives

• Gainsharing– An incentive plan where improvements in group

productivity determine the total amount of money that is allocated.


Variable Pay Programs: Organizational-Based Incentives

• Profit-Sharing Plans– Organization-wide programs that distribute

compensation based on some established formula designed around a company’s profitability.

• Employee Stock Ownership Plans (ESOPs)– Company-established benefit plans in which

employees acquire stock as part of their benefits.


Research Findings

• Linking variable-pay programs and expectancy theory:– Variable-pay programs seem to be consistent

with expectancy theory predictions.

– Employees are motivated when there is a perceived strong relationship between performance and rewards.


Motivating Beyond Productivity

• Commissions beyond sales– Customer satisfaction and/or sales team outcomes, such as

meeting revenue or profit targets.

• Leadership effectiveness– Employee satisfaction, or how the manager handles his or

her employees.

• New goals– All employees who contribute to specific organizational

goals, such as customer satisfaction, cycle time, or quality measures.


Rewards for Other Types of Performance

• Knowledge workers in teams– Performance of knowledge workers and/or professional

employees who work on teams.

• Competency and/or skills– Abstract knowledge or competencies—for example,

knowledge of technology, the international business context, customer service, or social skills.

• Skill-based – Pay is based on how many skills an employee has, or how

many jobs he or she can do.


Exhibit 4-11 Comparing Various Pay Programs


Designing Motivating Jobs

• Job Characteristic Model (JCM) is a model that identifies five core job dimensions and their relationship to personal and work outcomes.

• Job Enrichment– The vertical expansion of jobs.

• Employee does a complete activity.

– Expands the employee’s freedom and independence, increases responsibility, and provides feedback.


JCM – Core Job Dimensions

• Skill variety

• Task identity

• Task significance

• Autonomy

• Feedback


JCM – Critical Psychological States

• Experienced meaningfulness

• Experienced responsibility for outcomes

• Knowledge of the actual results


Exhibit 4-12 – Examples of High and Low Job Characteristics

Skill VarietyHigh variety – The owner-operator of a garage who does electrical repair, rebuilds engines, does body work,

and interacts with customersLow variety – A body shop worker who sprays paint eight hours a day

Task IdentityHigh identity – A cabinet maker who designs a piece of furniture, selects the wood, builds the object, and

finishes it to perfection Low identity – A worker in a furniture factory who operates a lathe solely to make table legs

Task SignificanceHigh significance – Nursing the sick in a hospital intensive care unitLow significance – Sweeping hospital floors

AutonomyHigh autonomy – A telephone installer who schedules his or her own work for the day, makes visits without

supervision, and decides on the most effective techniques for a particular installationLow autonomy – A telephone operator who must handle calls as they come according to a routine, highly

specified procedure

FeedbackHigh feedback – An electronics factory worker who assembles a radio and then tests it to determine if it

operates properlyLow feedback – An electronics factory worker who assembles a radio and then routes it to a quality control

inspector who tests it for proper operation and makes needed adjustments

Source: G. Johns, Organizational Behavior: Understanding and Managing Life at Work , 4th ed. Copyright © 1997. Adapted by permission of Pearson Education, Inc., Upper Saddle River, NJ.


Exhibit 4-13 The Job Characteristics Model

Core jobdimensions

Personal and work outcomes

Skill varietyTask identityTask significance

Experiencedmeaningfulnessof the work

High internalwork motivation

Autonomy

Experiencedresponsibilityfor outcomesof the work

High-qualitywork performance

FeedbackKnowledge of theactual results ofthe work activities

High satisfactionwith the work

Low absenteeismand turnover

Employee growth-need strength

Criticalpsychological states

Source: J. R. Hackman, G. R. Oldham, Work Design (excerpted from pages 78-80). Copyright © 1980 by Addison-Wesley Publishing Co. Reprinted by permission of Addison-Wesley Longman.


Beware the Signals That Are Sent By Rewards

• Often reward systems do not reflect organizational goals:– Individuals are stuck in old patterns of rewards and

recognition.• Stick to rewarding things that can be easily measured.

– Organizations don’t look at the big picture.• Subunits compete with each other.

– Management and shareholders focus on short-term results.


We hope for:

• Teamwork and collaboration

• Innovative thinking and risk-taking

• Development of people skills

• Employee involvement and empowerment

• High achievement

• Long-term growth; environmental responsibility

• Commitment to total quality

• Candor; surfacing bad news early

But we reward:

• The best team members

• Proven methods and not making mistakes

• Technical achievements and accomplishments

• Tight control over operations and resources

• Another year’s effort

• Quarterly earnings

• Shipment on schedule, even with defects

• Reporting good news, whether it’s true or not; agreeing with the manager, whether or not (s)he’s right

Exhibit 4-14Management Reward Follies

Source: Constructed from S. Kerr, “On the Folly of Rewarding A, While Hoping for B,” Academy of Management Executive 9, no. 1 (1995), pp. 7-14; and “More on the Folly,” Academy of Management Executive 9, no. 1 (1995), pp. 15-16. Reprinted by permission.


Caveat Emptor: Apply Motivation Theories Wisely

• Motivation Theories Are Culture-Bound– Canada and US rely on extrinsic rewards more

than other countries.

– Japan and Germany rarely use individual incentives.

• Japan emphasizes group rewards.

– China is more likely to give bonuses to everyone.


Exhibit 4-15 Snapshots of Cultural Differences in Motivation

Japan:Sales representatives preferred being members of a successful

team with shared goals and values, rather than financial rewards.

Russia:Cotton mill employees given either valued extrinsic rewards

(North American T-shirts with logos, children’s sweatpants, tapes of

North American music, etc.) or praise and rewards were more productive.

However, rewards did not help for those who worked on

Saturdays.

China: Bonuses often given to everyone, r egar dless of individual

productivity. Many employees expect jobs for life, rather than jobs based

on performance.

Mexico: Employees prefer immediate feedback on their work. Therefore

daily rewards for exceeding quotas are preferred.

Canada and the United States:Managers rely more heavily on extrinsic

motivators.

Japan and Germany:Firms rarely give rewards based on individual

performance.


Can We Just Eliminate Rewards?

• Alfie Kohn suggests that organizations should focus less on rewards, more on creating motivating environments:– Abolish Incentives.

– Re-evaluate Evaluation.

– Create Conditions for Authentic Motivation.

– Encourage Collaboration.

– Enhance Content.

– Provide Choice.


Putting It All Together

• What we know about motivating employees in organizations:– Recognize individual differences.

– Employees have different needs.

– Don’t treat them all alike.

– Spend the time necessary to understand what’s important to each employee.

– Use goals and feedback.

– Allow employees to participate in decisions that affect them.

– Link rewards to performance.

– Check the system for equity.


Summary and Implications

1. What is Motivation?– Motivation is the process that accounts for an

individual’s intensity, direction, and persistence of effort toward reaching the goal.

2. How do needs motivate people?– All needs theories of motivation propose a

similar idea: individuals have needs that, when unsatisfied, will result in motivation.


Summary and Implications3. Are there other ways to motivate people?

– Process theories focus on the broader picture of how someone can set about motivating another individual. Process theories include expectancy theory and goal- setting theory (and its application, management by objectives).

4. Do equity and fairness matter?– Individuals look for fairness in the reward system.

Rewards should be perceived by employees as related to the inputs they bring to the job.


Summary and Implications

5. How can rewards and job design motivate employees?– Recognition helps employees feel that they matter.

Employers can use variable-pay programs to reward performance. Employers can use job design to motivate employees. Jobs that have variety, autonomy, feedback, and similar complex task characteristics tend to be more motivating for employees.

6. What kinds of mistakes are made in reward systems?– Often reward systems do not reward the performance that is

expected. Also, reward systems sometimes do not recognize that rewards are culture-bound.


OB at Work


For Review

1. What are the implications of Theories X and Y for motivation practices?

2. Identify the variables in expectancy theory.

3. Describe the four ways in which goal setting motivates.

4. Explain cognitive evaluation theory. How applicable is it to management practice?


For Review

5. What are the pluses and minuses of variable-pay programs from an employee’s viewpoint? From management’s viewpoint?

6. What is an ESOP? How might it positively influence employee motivation?

7. Describe the five core dimensions in the JCM.8. Describe three jobs that score high on the JCM.

Describe three jobs that score low.9. What can firms do to create more motivating

environments for their employees?


For Critical Thinking

1. Identify three activities you really enjoy (for example, playing tennis, reading a novel, going shopping). Next, identify three activities you really dislike (for example, visiting the dentist, cleaning the house, following a low-fat diet). Using expectancy theory, analyze each of your answers to assess why some activities stimulate your effort while others don’t.

2. Identify five different bases by which organizations can compensate employees. Based on your knowledge and experience, is performance the basis most used in practice? Discuss.



3. “Employee recognition may be motivational for the moment, but it doesn’t have any staying power. Why? Because employees can’t take recognition to Roots or The Bay!” Do you agree or disagree? Discuss.

4. “Performance can’t be measured, so any effort to link pay with performance is a fantasy. Differences in performance are often caused by the system, which means the organization ends up rewarding the circumstances. It’s the same thing as rewarding the weather forecaster for a pleasant day.” Do you agree or disagree with this statement? Support your position.



5. Your textbook argues for recognizing individual differences. It also suggests paying attention to members of diverse groups. Does this view contradict the principles of equity theory? Discuss.


Breakout Group Exercises

• Form small groups to discuss the following topics:1. One of the members of your team continually arrives late for meetings

and does not turn drafts of assignments in on time. Choose one of the available theories and indicate how the theory explains the member’s current behaviour and how the theory could be used to motivate the group member to perform more responsibly.

2. You are unhappy with the performance of one of your instructors and would like to encourage the instructor to present more lively classes. Choose one of the available theories and indicate how the theory explains the instructor’s current behaviour. How could you as a student use the theory to motivate the instructor to present more lively classes?


Breakout Group Exercises

3. Harvard University recently changed its grading policy to recommend to instructors that the average course mark should be a B. This was the result of a study showing that more than 50 percent of students were receiving an A or A- for coursework. Harvard students are often referred to as “the best and the brightest,” and they pay $27 000 (US) for their education, so they expect high grades. Discuss the impact of this change in policy on the motivation of Harvard students to study harder.


Exhibit 4-16 2005 Compensation of Canada’s “Most Overpaid” CEOs

CEO(s) Was Paid (3-Yr Avg.)

Should Have Been Paid

Amount Overpaid

1. Ian Telfer/Robert McEwen Goldcorp Vancouver, BC

$32 823 000 $1 313 000 $31 510 000

2. E. Melnyk Biovail Mississauga, Ontario

$23 392 000 $1 404 000 $21 988 000

3. Richard Smith/David Stein CoolBrands Markham, Ontario

$9 647 000 $675 000 $8 972 000

4. Jeffrey Orr/Robert Gratton Power Financial Corporation Montreal, Quebec

$76 139 000 $9 898 000 $66 241 000

5. Gerald Schwartz Onex Toronto, Ontario

$26 163 000 $4 709 000 $21 454 000


Supplemental Material

Slides for activities I do in my own classroom


Exercise on Motivation Theories

• Jesse has been underperforming at work, coming in late, and causing some problems with the other workers. Previously, Jesse had been one of your star employees. Using the theory assigned to your group, explain what steps you might take to motivate Jesse to perform better.– Describe the plan.

– Indicate how the plan relates to the theory.


Theories to Apply

• Herzberg Motivation-Hygiene (Two-Factor) Theory

• Expectancy

• Goal-Setting Theory

• Equity

• Cognitive Evaluation Theory

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