Motivating and Rewarding Employees
Principles of Management
Motivation and Individual Needs
• Motivation, result of interaction between the individual and the situation they face.
• An individual’s motivation varies from situation to situation.
• Motivation: Willingness to exert high levels of effort to reach organizational goals, conditioned by the effort’s ability to satisfy some individual need
• Three key elements of Motivation: Effort, Organizational Goals, Needs.
• Effort: When someone is motivated, they try hard.
• Organizational Goals: Effort is channeled in a direction that benefits the organization.
• Need: An internal state that makes certain outcomes appear attractive.
Theories of Motivation
1. Maslow’s Hierarchy of Needs
• Physiological Needs: Food, Drink and Shelter.
• Safety Needs: Security and Protection from Physical and Emotional harm.
• Social Needs: Affection, Acceptance and Friendship.
• Esteem Needs: Internal Esteem factors; Self-respect and Achievement and External Esteem factors; Status and Attention.
• Self-Actualization Needs: Growth, achieving one’s potential and Self-fulfillment.
2. McGregor’s Theory X and Theory Y
Theory X Theory Y
A Negative View A Positive View
Dislike Work Creative
Lazy Seek Responsibility
Avoid Responsibility Exercise Self-Direction
Coerced to Perform
3. Herzberg’s Motivation-Hygiene Theory
• An individual’s attitude towards their work determines Success or Failure.
• Intrinsic factors: Achievement, Recognition and Responsibility; related to Job Satisfaction.
• Extrinsic factors: Company policy, Supervision and Working conditions; related to Job Dissatisfaction.
• Removing Dissatisfying characteristics from a job does not make job Satisfying.
• Hygiene Factors: Factors that eliminate job dissatisfaction but doesn’t increase job satisfaction. For example; working conditions and Salary.
• Motivators: Factors that increase job satisfaction. For example; Recognition and Growth.
Contemporary Theories of Motivation
1. McClelland’s Three-Needs Theory
I. Need for Achievement: Drive to excel, to achieve in relation to a set of standards, to strive to succeed.
II. Need for Power: Need to make others behave in a way that they would not have behaved otherwise.
III. Need for Affiliation: Desire for friendly and close interpersonal relationships.
2. Input and Outcomes Influence Motivation
• Employees make comparisons of their job inputs and outcomes relative to others.
• Inequities influence the degree of effort that employees exert.
• Equity Theory: Employees perceive what they get from a job situation (outcomes) in relation to what they put into it (inputs) and then compare their input-outcome ration with input-outcome ratios of relevant others.
3. Job Design
Job Characteristics Model (JCM): Hackman and Oldham’s job description model.
I. Skill Variety: Job requires a variety of activities; worker can use a number of different skills and talents.
II. Task Identity: Job requires completion of a whole and identifiable piece of work.
III. Task Significance: Job affects the lives or work of other people.
IV. Autonomy: Job provides freedom and independence in scheduling the work and in determining the procedures to be used.
V. Feedback: Carrying out the work activities required by the job results in the individual’s obtaining direct and clear information about the effectiveness of their performance.
Job Enrichment: Vertically expanding a job by adding planning and evaluation responsibilities.
4. Expectancy Theory
An individual tends to act in a certain way on the basis of the expectation that the act will be followed by a given outcome and the attractiveness of that outcome to the individual.
I. Effort-Performance Linkage: Probability perceived by the individual exerting a given amount of effort leading to performance.
II. Performance-Reward Linkage: Individual believes that performing at a particular level lead to the attainment of a desired outcome.
III. Attractiveness: Importance that the individual places on the potential outcome or reward that can achieve on the job.
Contemporary Issues in Motivation
Motivating a Diverse Workforce:
• Management needs to think in terms of Flexibility.
• Employees have different personal needs and goals that they’re hoping to satisfy through their job.
• Diverse array of rewards.
• Managers must be flexible enough to accommodate cultural differences.
Paid for Performance or Time on the Job:
Pay-for-performance Programs: Pay employees on the basis of some performance measure. For example: Piece-rate plans, profit sharing and lump-sum bonuses.
• Employees perceive a strong relationship between their performance and rewards they receive if motivation is to be maximized.
Competency-based Compensation: Pays and rewards employees on the basis of the skills, knowledge or behavior employees possess. For example: Leadership, Problem solving and Decision making.
Broad-banding: Preset pay levels, established on the basis of the degree to which these competencies exist.
Stock Options: A program that allows employees to purchase company stock at a fixed price.
Motivate Minimum-Wage Employees:
• Money is important as a Motivator but not the only reward.
• Employee Recognition programs (employee of the month)
• Empowerment and Career Development Assistance.
• They need guidance, assistance in self-assessment and training.
Motivating Professional and Technical Employees:
• Professional and Technical employees value support.
• Managers must provide them with new assignments and challenging projects.
• Reward them with Educational Opportunities – Training, Workshops and Conferences.
Improve Work/Life Balance:
• Managers’ attempts to increase their organizations’ flexibility and to support a balance between work and family, a number of scheduling options.
• Increased use of temporary and contingent workers.
Flextime: A scheduling option that allows employees, within specific parameters, to decide when to go to work.
Job Sharing: A special type of part-time job that allows two or more individuals to split a traditional 40-hour-a-week job.
Telecommuting: A system of working at home on a computer that is linked to the office.
Entrepreneurs in Motivating Employees:
• Employee empowerment.
• Participative decision making and delegation.
• Employees work effectively and efficiently using their creativity, imagination, knowledge and skills.
• Businesses are more flexible and achieve productivity gains, quality improvements, more satisfied customers, increased employee motivation and improved morale.
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