罗宾斯《管理学原理》

CHAPTER 10 - MOTIVATING AND REWARDING EMPLOYEES

LEARNING OUTCOMES

After reading this chapter students should be able to:

1. Describe the motivation process.

2. Define needs.

3. Explain the hierarchy of needs theory.

4. Differentiate Theory X from Theory Y.

5. Explain the motivational implications of the motivation-hygiene theory.

6. Describe the motivational implications of equity theory.

7. Explain the key relationships in expectancy theory.

8. Describe how managers can design individual jobs to maximize employee performance.

9. Describe the effect of work force diversity on motivational practices.

10. Describe how entrepreneurs motivate their employees.

Opening Vignette
SUMMARY

Are happy workers productive workers or are productive workers happy?  Since 1995, US workers’ productivity has increased by more than 33 percent.  Since 1979, US worker productivity has increased by more than 67 percent (one of the fastest productivity periods in US history.)  Thus, US organizations should have happy, excited, and motivated workers---which is not the case.  Salary and benefits may be at the heart of this issue. 
Since 1995, worker salaries have increased by 11 percent.  While an increase in salary is generally preferred by workers, at the same time the number of workers on the payroll has decreased sharply (due to downsizing and outsourcing).  Employees who keep their jobs are often doing the work that once took two or three employees to handle.  Go back a bit further and one will see that the overall employee salary increase is slightly less---only an 8.9 percent increase since 1979.  Factor in demographics like gender, education, and race, and the percentage increases differ widely.  For example, women who now comprise about half of the workforce have seen their salaries increase only 7.4 percent since 1979.  For all groups, salary increases have been relatively non-existent since 2001.
Employee benefits are shrinking, too.  Over the past five years, organizations offering retirement plans to their full-time employees has decreased approximately seven percent.  Likewise, health insurance coverage for employees has fallen 3 percent during the same period .  For those employees who are fortunate to have health insurance as a company benefit, their share of the premium costs have increased by 73 percent since 2000.
Sadly, as one reviews the future trends in these areas, it appears to indicate that these phenomenon will continue.  But organizations often wonder why organizational loyalty has decreased.  Quite possibly the realization that workers are working harder and reaping fewer rewards may indicate that they are, indeed, unhappy and less motivated--- and less committed to their employers.  While precise cause and effect may not be established with just these statistics, the trends should be food for thought by organizations today as to how such occurrences impact employee motivation.

Teaching notes

1) Ask students to identify the other motivational aspects of being an employee in a US organization. 

        2) How do the motivational aspects generated in Question 1 as well as those in the vignette relate to Maslow’s hierarchy of needs theory? (Note: Be sure they note that the vignette is about physiological and safety needs.)  Can we use Maslow’s theory to understand why these productive workers are not happy and satisfied? (Note: Students should point out that Maslow would say that because the bottom of the hierarchy is not being met, employee happiness based in social, esteem, and self-actualization will not occur until those needs are met)

3) Do you think Herzberg’s motivation-hygiene theory applies to the employees today?   Why or why not? (Note: Be sure students understand that according to Herzberg, employees would be dissatisfied by not having their hygiene needs met.  But, meeting those hygiene needs would not satisfy employees---it would only eliminate dissatisfaction.  To motivate and have happy workers, motivational factors must be present).

 4)Do you think that motivation theories and practices that motivate individuals at a U.S. based company would be effective in explaining and generating motivation in other countries?  If so, which countries?  If not, why? (Most motivation theories are US based and are culture bound)

I. MOTIVATION AND INDIVIDUAL NEEDS

A. Definitions (PPT 10-2)

1. Many incorrectly view motivation as a personal trait.

2. Motivation is the result of the interaction between the individual and the situation.

a) Individuals differ in motivational drive.

b) An individual’s motivation varies from situation to situation.

3. We’ll define motivation as the willingness to exert high levels of effort to reach organizational goals, conditioned by the effort’s ability to satisfy some individual need.

4. Function of three key elements: effort, directed at the organization’s goals, and needs.

a) The effort element is a measure of intensity.

1) When someone is motivated, he or she tries hard.

b) The effort must be channeled in a direction that benefits the organization.

1) Effort directed toward, and consistent with, the organization’s goals.

c) Motivation is a need-satisfying process.  (See Exhibit 10-1)

5. A need, in our definition, is some internal state that makes certain outcomes appear attractive.

a) An unsatisfied need creates tension that stimulates drives within an individual.

b) These drives generate a search behavior to satisfy the need and reduce the tension.

6. We can say that motivated employees are in a state of tension.

a) To relieve this tension, they exert effort.

b) The greater the tension, the higher the effort level.

7. Inherent in our definition of motivation is the requirement that the individual’s needs be compatible and consistent with the organization’s goals.

8. Self Assessment # 10, What Motivates Me?, #6 What do I Value? #12, What Rewards do I
      Value Most? #13, What’s my View on the Nature of People?

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II. EARLY THEORIES OF MOTIVATION

A. Introduction

1. In the 1950s three specific theories were formulated.

a) Now considered questionably valid, are probably still the best-known explanations for employee motivation.

b) The hierarchy of needs theory.

c) Theories X and Y.

d) The motivation-hygiene theory.

2. Although more-valid explanations of motivation have been developed, students should know these theories because:

a) They represent the foundation from which contemporary theories grew.

b) Practicing managers regularly use these theories and their terminology.

B. What Is Maslow’s Hierarchy of Needs Theory? (PPT 10-3)

1. The best-known theory of motivation.

2. Within every human being, there exists a hierarchy of five needs.

a) Physiological needs.

b) Safety needs.

c) Social needs.

d) Esteem needs.

e) Self-actualization needs.

3. As each need is substantially satisfied, the next need becomes dominant. (See Exhibit 10-2.)

4. No need is ever fully gratified, a substantially satisfied need no longer motivates.

5. To motivate, you need to understand where that person is in the hierarchy and focus on satisfying needs at or above that level.

6. Widely recognized, particularly among practicing managers, its popularity can be attributed to the theory’s intuitive logic and ease of understanding.

7. Research does not generally validate the theory.

8. Maslow had no empirical substantiation for his theory, and several studies found no support.

C. What Is McGregor’s Theory X and Theory Y? (PPT 10-4)

1. Douglas McGregor proposed two distinct views of the nature of human beings.

a) A basically negative view, labeled Theory X.

b) A basically positive view, labeled Theory Y.

2. McGregor concluded that a manager’s view of human nature, and therefore his or her approach to management, is based on a group of assumptions, either positive or negative.
(See Exhibit 10-3.)

3. Theory X assumes that physiological and safety needs dominate the individual.

4. Theory Y assumes that social and esteem needs are dominant.

5. McGregor held to the belief that the assumptions of Theory Y were the most valid.

6. There is no evidence to confirm either set of assumptions.

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D. What Is Herzberg’s Motivation-Hygiene Theory? (PPT 10-5)

1. An individual’s attitude toward his or her work can very well determine success or failure.

2. Herzberg investigated the question “What do people want from their jobs?”

a) Exhibit 10-4 represents Herzberg’s findings.

3. He concluded that certain characteristics were consistently related to job satisfaction (factors on the left side of Exhibit 10-4) and others to job dissatisfaction (the right side of Exhibit   10-4).

a) Intrinsic factors such as achievement, recognition, and responsibility were related to job satisfaction.

b) When dissatisfied, they tended to cite extrinsic factors such as company policy and administration, supervision, interpersonal relationships, and working conditions.

4. The opposite of satisfaction is not dissatisfaction, as was traditionally believed.

a) Removing dissatisfying characteristics does not necessarily make the job satisfying.

b) Exhibit 10-5, the opposite of “satisfaction” is “no satisfaction,” and the opposite of “dissatisfaction” is “no dissatisfaction.”

5. Managers who eliminate factors that create job dissatisfaction bring about peace but not motivation.

a) The factors that eliminate job dissatisfaction were characterized as hygiene factors.

b) To motivate people on their jobs, emphasize motivators, those factors that increase job satisfaction.

6. The criticisms of the theory include the methodology Herzberg used and his failure to account for situational variables.

7. Much of the enthusiasm for enriching jobs can be attributed to Herzberg’s findings.

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E. What are the Similarities and Differences Among the Early Theories of Motivation?

1. Similarities.

a) Each is popular in the literature and practicing managers’ minds.

b) Each is intuitively logical.

c) Each includes some lower-order needs.

1) Maslow’s physiological and safety needs.

2) McGregor’s Theory X.

3) Herzberg’s hygiene factors.

d) Each includes some higher-order needs.

1) Maslow’s social, esteem, and self-actualization.

2) McGregor’s Theory Y.

3) Herzberg’s motivators.

2. Differences.

a) Each looked at motivation of individuals from a different perspective.

1) Maslow’s Hierarchy of Needs theory focused on individual needs, or the self.

2) McGregor focused on the manager’s perception of the individual.

3) Herzberg focused on the organization’s effect on the individual.

III. CONTEMPORARY THEORIES OF MOTIVATION

A.  What Is McClelland’s Three-Needs Theory? (PPT 10-6)

1. David McClelland and others have proposed the three-needs theory.

2. Need for achievement (nAch)—the drive to excel, to achieve in relation to a set of standards, to strive to succeed.

a) Striving for personal achievement rather than for the rewards of success per se (nAch).

b) The desire to do something better or more efficiently than it has been done before.

c) High achievers differentiate themselves from others by their desire to do things better.

d) They seek situations in which they can attain personal responsibility for finding solutions to problems, in which they can receive rapid and unambiguous feedback, and in which they can set moderately challenging goals.

e) High achievers dislike succeeding by chance.

f) They avoid what they perceive to be very easy or very difficult tasks.

3. Need for power (nPow)—the need to make others behave in a way that they would not have behaved otherwise;

a) The need for power (nPow) is the desire to have impact and to be influential.
 
b) Individuals high in nPow enjoy being “in charge,” strive for influence over others, and prefer to be in competitive and status-oriented situations.

4. Need for affiliation (nAff)—the desire to be liked and accepted by others.

a) This need has received the least attention by researchers.

b) Striving for friendships, prefer cooperative situations rather than competitive ones, and desire relationships involving a high degree of mutual understanding.

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A Management Classic
David McClelland and the Three-Needs Theory
SUMMARY

David McClelland’s work focused on aspects of personality characteristics. The questions then are: (1) How do you find out if someone is, for instance, a high achiever? and (2) What effect can that person’s need for achievement have on an organization?
McClelland would give individuals a projective test in which subjects responded to a set of pictures. The responses were then classified as focusing on a need for achievement, power, or affiliation. Those who had a high need for achievement, however, shared some similar attributes.
High achievers perform best when they perceive their probability of success as 50-50. They dislike gambling, they dislike high probability of success, and they like to set goals that require stretching. Some
 reasonably well-supported predictions can be made between the relationship of the achievement need and job performance. There are consistent findings for power and affiliation needs also.

 When job situations have personal responsibility, feedback, and an intermediate degree of risk, high achievers are strongly motivated; they are successful in entrepreneurial activities.

 The needs for affiliation and power are closely related to managerial success.

 The best managers are high in the need for power and low in the need for affiliation.

 Last, employees can be trained successfully to stimulate their achievement need.

Teaching notes
1. Have students identify themselves as power, achievement, or affiliation motivated.

2. Move them into three groups based on their self-identification.

3. Have them create a list of motivators for their group.

4. Have the lists posted on the board.

5. Now discuss as a class the differences among the lists and the consequences of using the wrong motivator with each of these groups.

B. How Do Inputs and Outcomes Influence Motivation?

1. Employees make comparisons.

2. There is considerable evidence that employees make comparisons of their job inputs and outcomes relative to others and that inequities influence the degree of effort that employees exert.

3. Developed by J. Stacey Adams, equity theory says that 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 ratio with the input-outcome ratio of relevant others. (See Exhibit 10-6.) (PPT 10-7)

a) If they perceive their ratio to be equal to those of the relevant others with whom they compare themselves, a state of equity exists.

b) If the ratios are unequal, inequity exists; that is, workers view themselves as under-rewarded or over-rewarded.

4. The referent is an important variable in equity theory. (PPT 10-7)

5. There are three referent categories: “other,” “system,” and “self.”

a) Other includes other individuals with similar jobs in the same organization and also includes friends, neighbors, or professional associates.

b) The system considers organizational pay policies and procedures and the administration of that system.

c) Self refers to input-outcome ratios that are unique to the individual. It reflects past personal experiences and contacts.

6. The choice of a particular set of referents is related to the information available about referents as well as the perceived relevance.

7. When employees perceive an inequity, they might  (PPT 10-8)

a) distort either their own or others’ inputs or outcomes.

b) behave so as to induce others to change their inputs or outcomes.

c) behave so as to change their own inputs or outcomes.

d) choose a different comparison referent.

e) quit their job.

8. Individuals are concerned with both absolute rewards and the relationship of those rewards to what others receive.

9. On the basis of one’s inputs, such as effort, experience, education, and competence, one compares outcomes such as salary levels, raises, recognition, and other factors.

10. A perceived imbalance in input-outcome ratios relative to others’ creates tension.

11. The theory establishes four propositions relating to inequitable pay.  (See Exhibit 10-7.)

12. Whenever employees perceive inequity, they will act to correct the situation.

13. Equity theory is not without problems.

a) The theory leaves some key issues still unclear.

1) How do employees define inputs and outcomes?

2) How do they combine and weigh their inputs and outcomes to arrive at totals?

3) When and how do the factors change over time?

14. Equity theory has an impressive amount of research support and offers important insights into employee motivation.

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C. Does Job Design Influence Motivation?

1. What differentiates one job from another?

2. The job characteristics model (JCM), developed by J. Richard Hackman and Greg R. Oldham, helps managers describe any job in terms of five core job dimensions. (PPT 10-9)

a) Skill variety.  (PPT 10-10)

b) Task identity.  (PPT 10-10)

c) Task significance. (PPT 10-10)

d) Autonomy. (PPT 10-11)

e) Feedback.  (PPT 10-11)

3. Exhibit10-8 presents the model.

a) The first three dimensions—skill variety, task identity, and task significance—combine to create meaningful work.

b) Jobs that possess autonomy give the job incumbent a feeling of personal responsibility for the results.

c) If a job provides feedback, the employee will know how effectively he or she is performing.

4. Research on the JCM has found that the first three dimensions—skill variety, task identity, and task significance—combine to create meaningful work.

a) If these three characteristics exist in a job, we can predict that the person will view his or her job as being important, valuable, and worthwhile.

5. Jobs that possess autonomy give the job incumbent a feeling of personal responsibility.

6. Jobs that provide feedback let the employee know how effectively he or she is performing.

7. JCM suggests that internal rewards are obtained when an employee learns (knowledge of results through feedback) that one personally (experienced responsibility through autonomy of work) has performed well on a task that one cares about (experienced meaningfulness through skill variety, task identity, and/or task significance).

a) The links between the job dimensions and the outcomes are moderated or adjusted by the strength of the individual’s growth need (the person’s desire for self-esteem and self-actualization).

8. Individuals with a high growth need are more likely to experience the psychological states when their jobs are enriched than are their counterparts with a low growth need.

9. Exhibit 10-9 depicts guidelines for job redesign based on the JCM

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D. Why Is Expectancy Theory Considered a Comprehensive Theory of Motivation? (PPT 10-12, 10-13. 10-14)

1. The most comprehensive explanation of motivation is Victor Vroom’s expectancy theory.

2. It states that an individual tends to act 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.

3. It includes three variables or relationships. (PPT 10-14)

a) Effort-performance linkage—the probability perceived by the individual that exerting a given amount of effort will lead to performance.

b) Performance-reward linkage—the degree to which the individual believes that performing at a particular level will lead to the attainment of a desired outcome.

c) Attractiveness—the importance that the individual places on the potential outcome or reward that can be achieved on the job.

4. It can be summed up in the following questions:

a) How hard do I have to work to achieve a certain level of performance, and can I actually achieve that level?

b) What reward will performing at that level get me?

c) How attractive is this reward to me, and does it help achieve my goals?

i. How does expectancy theory work?

d) Exhibit 10-10 shows a very simple version of expectancy theory.

e) The strength of a person’s motivation to perform (effort) depends on how strongly that individual believes that he or she can achieve what is being attempted.

f) If this goal is achieved (performance), will he or she be adequately rewarded by the organization?

g) If so, will the reward satisfy his or her individual goals? (attractiveness)

1) First, what perceived outcomes does the job offer the employee?

(a) The critical issue is what the individual employee perceives the outcome to be, regardless of whether his or her perceptions are accurate.

2) Second, how attractive do employees consider these outcomes to be?

(a) This is an internal issue and considers the individual’s personal attitudes, personality, and needs.

3) Third, what kind of behavior must the employee exhibit to achieve these outcomes?

(a) What criteria will be used to judge the employee’s performance?

4) Fourth, how does the employee view his or her chances of doing what is asked?
 
(a) What probability does he or she place on successful attainment?

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Dilemma in Management
Rewarding Appropriate Behavior
SUMMARY

You have just been hired as a supervisor at the Extreme Travel Agency in Chicago, Illinois. In this job, customers call you to arrange travel plans. Many car rental agencies and hotels frequently run contests for the sales representatives. The incentives are attractive enough for you to “steer” customers toward those companies even though it might not be the best or the cheapest for them. The programs are viewed as a bonus for your hard work.

Questions
1. Is there anything wrong with your doing business with these car rental and hotel firms that offer kickbacks to you?

2. What ethical issue do you see in this case for (1) you and (2) your customers?

3. How could your organization design a performance reward system that would encourage you to high levels of bookings, while at the same time not compromising ethical practices and good customer service?

Teaching notes
2. Set this up as a debate by either dividing the class in half or choosing two small debate teams of 3 members each.

3. One side should approach the questions from the consumer’s perspective, the others from the travel business/travel agent.
4. In the debate, make certain that the students discuss the benefits of such programs for both the travel agent and for the consumer. Are there benefits for the consumer? Are all consumers concerned about the lowest possible price?

5. As you wrap up the discussion, ask students how the word “kickbacks” shaped their perception of the task.

6.    How can expectancy theory be applied?

         a)  A classroom analogy as an illustration.

b) Most students prefer an instructor who tells them what is expected of them in the course.

c) Consider that five weeks into a class you are really enjoying (we’ll call it BUAD 361), and examination is given back to you.

d) You studied hard, you believe top grades are important for getting a good job upon graduation. Also, you think grades are important for getting into a good graduate school.

e) Well, the results of that first examination are in.

1) The class average was 76.

2) Ten percent of the class scored an 88 or higher and got an A.

3) Your grade was 54; the minimum passing mark was 60.

4) You’re upset, frustrated, and perplexed.

f) Suddenly, you may no longer be driven to attend BUAD 361classes regularly.

1) You may find several reasons why you don’t want to study for the course either.

g) Exhibit 10-10 can help us understand this situation.
1) Studying for BUAD 361 (effort) is conditioned by the resulting correct answers on the examination (performance), which will produce a high grade (reward), which will lead, in turn, to the security, prestige, and other benefits that accrue from obtaining a good job (individual goal).

2) The attractiveness of the outcome of a good grade, is high.

3) The performance-reward linkage is strong if you feel the test fairly measured what you know. If it is weak, at least part of the reason for your reduced motivational level is your belief that the test was not a fair measure of your performance.

h) Another possible demotivating force may be the effort-performance relationship.

1) If, after you took the examination, you believe that you could not have passed it, then your desire to study may drop.
2) You place a low value on your effort leading to answering the examination questions correctly; hence, your motivational level decreases, and you lessen your effort.

i) Summary of the issues surrounding the theory.

1) First, expectancy theory emphasizes payoffs, or rewards.

2) Second, expectancy theory stresses that managers understand why employees view certain outcomes as attractive or unattractive.

3) Third, the expectancy theory emphasizes expected behaviors.
 
4) Finally, the theory is concerned with perceptions. The facts are irrelevant. There must be continuous feedback to align perceptions with reality.

j) The individual’s own perceptions of performance, reward, and goal satisfaction will determine the effort expended.

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E. How Can We Integrate the Contemporary Theories of Motivation?

1. There is a tendency to view the motivation theories independently even though many of the ideas underlying the theories are complementary.

2. Exhibit 10-11 presents a model that integrates much of what we know about motivation. (

a) Its basic foundation is the simplified expectancy model shown in Exhibit 10-10.

3. The individual effort box has an arrow leading into it that flows out of the individual’s goals.

4. The goals-effort loop is meant to remind us that goals direct behavior.
 
a) Expectancy theory predicts that an employee will exert a high level of effort if he or she perceives a strong relationship between effort and performance, performance and rewards, and rewards and satisfaction of personal goals.

b) Need theories tell us that motivation would be high to the degree that the rewards an individual received for his or her high performance satisfied the dominant needs consistent with his or her individual goals.

5. The model considers the need for achievement, equity, and the job characteristics model.

6. Finally, we can see the JCM in this exhibit. Task characteristics (job design) influence job motivation at two places.

a) First, jobs that score high in motivating potential are likely to lead to higher actual job performance since the employee’s motivation is stimulated by the job itself.

b) Second, jobs that score high in motivating potential also increase an employee’s control over key elements in his or her work.

7. If you were a manager concerned with motivating your employees, what specific recommendations could you draw from this integration?

a) See Developing Your Skill at Motivating Employees.

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Developing Your Skill at Motivating Employees

Maximizing Employee Effort

About the Skill
There is no simple, all-encompassing set of motivational guidelines, but the following suggestions draw on the essence of what we know about motivating employees.

Steps in Practicing the Skill
1) Recognize individual differences.
2) Match people to jobs.
3) Use goals.
4) Ensure that goals are perceived as attainable.
5) Individualize rewards.
6) Link rewards to performance.
7) Check the system for equity.
8) Don’t ignore money.

Teaching Tips
Invite students to look at the list of traditional and offbeat benefits currently offered at various U.S. firms and share all the additional traditional and offbeat benefits that they know are currently offered at various U.S. firms.

Ask students to rank order them, putting those that are most likely to motivate them at the top of their list.  You might find it interesting to also rank order them for yourself.
 
Look at your top five choices.

How do you think you would rank them in 10 years? Why?

Discuss as a class the students’ rankings. Ask volunteers to explain their rankings and why they think they will change or won’t change over time.
IV. CONTEMPORARY ISSUES IN MOTIVATION

A. What Is the Key to Motivating a Diverse Work Force? (PPT 10-15)

1. Flexibility is key to maximizing motivation among today’s diversified work force.

2. Studies show that men place considerably more importance on autonomy in their jobs than do women.

3. The opportunity to learn, convenient work hours, and good interpersonal relations are more important to women than to men.

4. What motivates a single mother with two dependent children working full time may be very different from the needs of a young, single, part-time worker, or the older employee.

5. Employees have different personal needs and goals they’re hoping to satisfy through their jobs.

6. Motivating a diverse work force also means that managers must be flexible enough to accommodate cultural differences.

a) The theories of motivation we have been studying were developed largely by U.S. psychologists and were validated in studies of American workers.

b) Therefore, these theories need to be modified for different cultures.

1) The self-interest concept is consistent with capitalism and the extremely high value placed on individualism in countries such as the United States.

2) These motivation theories should be applicable to employees in such countries as Great Britain and Australia.

3) In more collectivist nations—such as Japan, Greece, and Mexico—security needs would be on top of the needs hierarchy—not self-actualization.

7. The need-for-achievement concept also has a U.S. bias.

a) It presupposes the existence of two cultural characteristics: a willingness to accept a moderate degree of risk and a concern with performance.

b) These characteristics would exclude countries with high uncertainty avoidance scores and high quality-of-life ratings.

8. Several recent studies among employees in other countries indicate that some aspects of motivation theory are transferable.

a) Motivational techniques were shown to be effective in changing performance-related behaviors of Russian textile mill workers.

9. Managers must change their motivational techniques to fit the culture.

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B. Should Employees Be Paid for Performance or Time on the Job?

1. What’s in it for me?

2. People act to satisfy some need. They look for a payoff or reward.

3. Pay is an important variable in motivation; managers need to look at how pay is used to motivate high levels of employee performance.

4. Pay-for-performance programs pay employees on the basis of some performance measure. (PPT 10-16)

a) Piece-rate plans, gainsharing, wage incentive plans, profit sharing, and lump-sum bonuses.

5. These forms of pay reflect pay adjustments based on performance measures.
 
6. Performance-based compensation is probably most compatible with expectancy theory.

7. Pay-for-performance programs are gaining in popularity in organizations.

8. The growing popularity can be explained in terms of both motivation and cost control.

9. Making some or all of a worker’s pay conditional on performance measures focuses his or her attention and effort on that measure, then reinforces the continuation of that effort with rewards.
a) However, if the employee, team, or the organization’s performance declines, so too does the reward.

10. A recent extension of this concept is called competency-based compensation.

a) It pays and rewards employees on the basis of the skills, knowledge, or behaviors employees possess.

b) Pre-set pay levels (broadbanding) are established on the basis of the degree to which these competencies exist. 

c) Pay increases in a competency-based system are awarded for growth in personal competencies as well as for the contributions one makes to the overall organization.

11. Stock options—a variation of pay-for-performance programs in organizations today.

a) Common incentive offered to executives.

b) Generally allow certain individuals to purchase, at some time in the future, a specific amount of the company’s stock at a fixed price.

c) Clear intent of these programs is to reward those individuals who are fulfilling the strategic and political contingencies of the organization, as well as stockholder interests.

12. Do stock options encourage managers to engage in unethical accounting practices and/or manipulation of performance data?

a) Newspaper and popular press stories cite top management decisions to engage in questionable accounting practices in order to inflate stock prices and bolster their stock options.

b) Some corporate leaders have been accused of withholding accurate financial data long enough to sell off their stocks at significant profits.

c) Failure of managers at some companies to properly police themselves has led to new legislation to reform the corporate governance and accounting practices of public companies.

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C. How Can Managers Motivate Minimum-Wage Employees? (PPT 10-17)

1. One of the toughest motivational challenges facing many managers today is how to achieve high performance levels among minimum-wage workers.

2. One trap many managers fall into is thinking that employees are motivated only by money.
 
3. In motivating minimum-wage employees, managers should look at other types of rewards that help motivate employees.

a) Employee recognition programs such as employee of the month, quarterly employee-performance award ceremonies, or other celebrations of employee accomplishment.

b) These types of programs highlight employees whose work performance has been of the type and level the organization wants to encourage.

4. The power of praise. When praise is used, you need to be sure that these “pats on the back” are sincere and done for the right reasons.

5. In service industries, successful companies are empowering these front-line employees with more authority to address customers’ problems.

a) If we use the JCM to examine this change, we can see that this type of job redesign provides enhanced motivating potential because employees now experience increased skill variety, task identity, task significance, autonomy, and feedback.

D. What’s Different in Motivating Professional and Technical Employees? (PPT 10-17)

1. Professional and technical employees are typically different from nonprofessionals.
 
a) They have a strong and long-term commitment to their field of expertise.

b) Their loyalty is more often to their profession than to their employer.

c) Their commitment to their profession means they rarely define their workweek in terms of nine-to-five or five days a week.

2. Money and promotions into management typically are low on their priority list.

3. Job challenge tends to be ranked high.

a) They like to tackle problems and find solutions.

b) Their chief reward in their job is the work itself.

c) They value support.

d) They want others to think that what they are working on is important.

4. Managers should provide them with new assignments and challenging projects.

a) Give them autonomy to follow their interests and allow them to structure their work in ways they find productive.

b) Reward them with educational opportunities.

c) Reward them with recognition.

d) And managers should demonstrate that they’re sincerely interested in what they’re doing.

Teaching Notes  _______________________________________________________________________
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E. What Can Management Do to Improve Work-Life Balance?

1. Example—Susan Talbot is the classic “morning person.”

a) Susan’s work schedule as a claims adjuster at State Farm Insurance is flexible.

b) It allows him some degree of freedom as to when she comes to work and when she leaves.

2. Many employees continue to work an eight-hour day, five days a week.

3. A number of scheduling options have been introduced to give management and employees more flexibility.

4. How does flextime work?

a) Flextime is a scheduling option that allows employees, within specific parameters, to decide when to go to work.

b) Flextime is short for flexible work hours.

1) Employees have to work a specific number of hours a week, but they are free to vary the hours of work within certain limits.

2) Each day consists of a common core, usually six hours, with a flexibility band surrounding the core.

3) Some flextime programs allow extra hours to be accumulated and turned into a free day off each month.

4) Flextime has become an extremely popular scheduling option; about 60 percent of firms in a recent study offered employees some form of flextime.

5) The potential benefits from flextime are numerous.

(a) Improved employee motivation and morale, reduced absenteeism as a result of enabling employees to better balance work and family responsibilities, increased wages due to productivity gains, and the ability of the organization to recruit higher-quality and more-diverse employees.

6) Flextime’s major drawbacks:
(a) It is not applicable to every job.

(b) It works well with job tasks for which an employee’s interaction with people outside his or her department is limited.

(c) It is not a viable option when key people must be available during standard hours.

Teaching Notes  _______________________________________________________________________
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5.   Can employees share jobs? 

        a)   Job sharing is a special type of part-time work.

1) It allows two or more individuals to split a traditional forty-hour-a-week job.

b) Job sharing is growing in popularity, with 57 percent of large organizations offering it.

c) Job sharing allows the organization to draw upon the talents of more than one individual for a given job.

1) Opportunity to acquire skilled workers who might not be available on a full-time basis.

2) An option for managers to use to minimize layoffs.

d) Major drawback—finding compatible pairs of employees who can successfully coordinate the intricacies of one job.

6.   What is telecommuting?

a) Telecommuting capabilities that exist today have made it possible for employees to be located anywhere on the globe and do their jobs.

b) Companies no longer have to consider locating near their work force.

c) It refers to employees who do their work at home on a computer that is linked to their office.

d) More than 27 million people work at home in the United States—and the number is expected to continue to rise.

e) Telecommuting offers an opportunity for a business in a high-labor-cost area to have its work done in an area where lower wages prevail.

f) Challenge for employers revolves around training managers in how to establish and ensure appropriate work quality and on-time completion.

1)    Emphasis will be on the final product, not the means by which it is accomplished.

g) Work at home may also require managers to rethink their compensation policy.

1) Will the company pay workers by the hour, on a salary basis, or by the job performed?

2)    Employees who work more than 40 hours during the work week will be entitled to
                      overtime pay.

h) Because telecommuting employees are often full time, it will be the organization’s responsibility to ensure the health and safety of the off-premise work site.

1) Equipment provided by the company that leads to an employee injury or illness is the responsibility of the organization.

i) For employees, there are two big advantages of telecommuting.

1) The decrease in time and stress of commuting.

2) The increase in flexibility in coping with family demands.

j) Some potential drawbacks.

1) Telecommuting employees miss the regular social contact.

2) They may be less likely to be considered for salary increases and promotions.

3) Will non-work-related distractions significantly reduce productivity for those without superior willpower and discipline?

F. What do Entrepreneurs do to Motivate Employees?  (PPT 10-18)

1. Example of Sapient Corporation.

2. Having motivated employees is an important goal for any entrepreneur, and employee empowerment is an important motivational tool entrepreneurs can use.

3. Employee empowerment—giving employees the power to make decisions and take actions on their own—is an important motivational approach.

a) Can provide flexibility and speed.

b) Often display stronger work motivation, better work quality, high job satisfaction, and lower turnover.

c) Example, Stryker Instruments in Kalamazoo, Michigan.

4. Empowerment is a philosophical concept that entrepreneurs have to “buy into” and it’s hard for many entrepreneurs to do.

5. How can entrepreneurs empower employees?

a) Begin by using participative decision making in which employees provide input on decisions.

b) Through delegation—the process of assigning certain decisions or specific job duties to employees.

c) Fully empowering employees means redesigning their jobs so they have discretion over the way they do their work.

1) Allowing employees to do their work effectively and efficiently by using their creativity, imagination, knowledge, and skills.

6. Effective employee empowerment can result in significant productivity gains, quality improvements, more satisfied customers, increased employee motivation, and improved morale.

a)    Example, Mine Safety Appliances in Murrysville, Pennsylvania.

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Review, Comprehension, Application
Chapter Summary

1. The motivation process begins with an unsatisfied need, which creates tension and drives an individual to search for goals that, if attained, will satisfy the need and reduce the tension.

2. Needs are some internal state that make certain outcomes appear attractive.

3. The hierarchy of needs theory states that there are five needs—physiological, safety, social, esteem, and self-actualization.

4. Theory X is basically a negative view of human nature, assuming that employees dislike work, are lazy, seek to avoid responsibility, and must be coerced to perform. Theory Y is basically positive, assuming that employees are creative, seek responsibility, and can exercise self-direction.

5. The motivation-hygiene theory states that not all job factors can motivate employees. The presence or absence of certain job characteristics, or hygiene factors, can only placate employees. Factors that people find intrinsically rewarding, such as achievement, recognition, responsibility, and growth, act as motivators and produce job satisfaction.

6. In equity theory, individuals compare their job’s input-outcome ratios with those of relevant others.

7. The expectancy theory states that an individual tends to act in a certain way based on the expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual.

8. Managers can design individual jobs to maximize employee performance by combining tasks, creating natural work units, establishing client relationships, expanding jobs vertically, and opening feedback channels.

9. Maximizing motivation in contemporary organizations requires that managers be flexible in their practices.

10.  Employee empowerment is an important motivational tool that entrepreneurs use.  Entrepreneurs use
       participative decision making and delegation.  They allow employees to do their work effectively and
       efficiently by using their creativity, imagination, knowledge, and skills.  As a result, the business will
       be more flexible and is likely to achieve productivity gains, quality improvements, more satisfied
       customers, increased employee motivation, and improved morale.

Companion Website
We invite you to visit the Robbins/DeCenzo Companion Website at www.prenhall.com/robbins for the chapter quiz and student PowerPoints.

 Diversity Perspectives: Communication and Interpersonal Skills, by Carol Harvey and June Allard
1. Using equity theory, explain what happened between Kristen and Maria. What was the effect on Kristen’s motivation?
Kristen perceived that Maria was putting less time into her job, and that she had a more favorable work schedule (inputs). Yet, they were both receiving the same outputs in terms of rank and salary. In her perception, Kristen restored balance, i.e. equity by taking two days off at the busiest time of the month for the magazine.

2.    Why was Maria motivated to do extra work at home on the weekend?
Amber met Maria’s needs by being flexible with the time parameters of the job. This met Maria’s need in terms of her role as a new parent and motivated Maria to do extra work on her own time. 

3.    What can a manager learn about motivation from this scenario? 
It is important to understand that individuals have different motivators. A manager needs to understand each employee in terms of his/her needs and motivators. It is also important to communicate exceptions to rules, so that employees don’t perceive inequitable treatment that may demotivate them.

Reading for Comprehension
1. How do needs affect motivation?
Answer – Motivation is a need-satisfying process. A need, in our terminology, means some internal state that makes certain outcomes appear attractive. An unsatisfied need creates tension that stimulates drives within an individual. These drives generate a search behavior to satisfy the need and reduce the tension. We can say that motivated employees are in a state of tension. To relieve this tension, they exert effort. The greater the tension, the higher the effort level.

2. Contrast lower-order and higher-order needs in Maslow’s needs hierarchy.
Answer – Within every human being, there exists a hierarchy of five needs. Lower-order needs are physiological needs and safety needs. Higher-order needs are social needs, esteem needs, and self-actualization needs. See Exhibit 10-2.

3. Describe the three needs in the three-needs theory.
Answer – David McClelland and others have proposed the three-needs theory.

Need for achievement (nAch). The drive to excel, to achieve in relation to a set of standards, to strive to succeed. Striving for personal achievement rather than for the rewards of success per se (nAch). The desire to do something better or more efficiently than it has been done before. They seek situations in which they can attain personal responsibility for finding solutions to problems, in which they can receive rapid and unambiguous feedback, and in which they can set moderately challenging goals.

Need for power (nPow). The need to make others behave in a way that they would not have behaved otherwise. The need for power (nPow) is the desire to have impact and to be influential. Individuals high in nPow enjoy being “in charge,” strive for influence over others, and prefer to be in competitive and status-oriented situations.

Need for affiliation (nAff). The desire for friendly and close interpersonal relationships. Striving for friendships, prefer cooperative situations rather than competitive ones, and desire relationships involving a high degree of mutual understanding.

4. What are some of the possible consequences of employees perceiving an inequity between their inputs and outcomes and those of others?
Answer – There is considerable evidence that employees make comparisons of their job inputs and outcomes relative to others and that inequities influence the degree of effort that employees exert. The relationships are charted in Exhibit 10-6.

If the ratios are unequal, inequity exists; that is, they view themselves as under-rewarded or over-rewarded. When inequities occur, employees attempt to correct them. On the basis of equity theory, when employees perceive an inequity, they might (1) distort either their own or others’ inputs or outcomes, (2) behave in some way to induce others to change their inputs or outcomes, (3) behave in some way to change their own inputs or outcomes, (4) choose a different comparison referent, and/or (5) quit their job. The theory establishes the four propositions relating to inequitable pay. These propositions, are listed in Exhibit 10-7.

5. What are some advantages of using pay-for-performance to motivate employee performance? Are there drawbacks? Explain.
Answer – People do what they do to satisfy some need. They look for a payoff or reward. Pay is an important variable in motivation; managers need to look at how pay is used to motivate high levels of employee performance. Pay-for-performance programs are compensation plans that pay employees on the basis of some performance measure and is probably most compatible with expectancy theory. Pay-for-performance programs are gaining popularity in organizations. Making some or all of a worker’s pay conditional on performance measures focuses his or her attention and effort on that measure, then reinforces the continuation of that effort with rewards. However, if the employee, team, or the organization’s performance declines, so too does the reward. Failure to reach the performance measures can result in the forfeiture of a percentage of salary placed at risk.

Linking Concepts to Practice
1. What role would money play in (a) the hierarchy of needs theory, (b) motivation-hygiene theory, (c) equity theory, (d) expectancy theory, and (e) motivating employees with a high nAch?
Answer – (a) Money might be a security need, providing shelter, food, and clothing, or it could be a self-esteem need in giving the individual a sense of self-worth. (b) Money is a hygiene theory. (c) Money becomes a measure of fairness—Is my raise, salary appropriate to my position? (d) Money is relevant only to the degree the individual perceives that the monetary reward is appropriate for the amount of effort put forth. (e) Money could be seen as a way to measure success.

2. If you accept Theory Y assumptions, how would you be likely to motivate employees?
Answer – By using recognition programs, using enrichment and empowerment efforts, and focusing on giving employees opportunities to grow in their jobs.

3. Would an individual with a high nAch be a good candidate for a management position? Explain.
Answer – Maybe. No, because the individual is striving for personal achievement rather than achievement through the efforts of others. Yes, if the individual is managing a process rather than people and has the opportunity to make something better. The drive to excel, to achieve in relation to a set of standards, to strive to succeed. Striving for personal achievement rather than for the rewards of success per se (nAch). The desire to do something better or more efficiently than it has been done before. They seek situations in which they can attain personal responsibility for finding solutions to problems, in which they can receive rapid and unambiguous feedback, and in which they can set moderately challenging goals.

4. What difficulties do you think work force diversity causes for managers who are trying to use equity theory?
Answer – Equity theory is heavily dependant on employee perception. Perceptions will vary based on cultural backgrounds. So managers need to be sensitive to cultural differences.

5. Describe several means that you might use to motivate (1) a minimum-wage employee or (2) professional and technical employees? Which of your suggestions do you think is best? Support your position.
Answer – One of the toughest motivational challenges facing many managers today is how to achieve high performance levels among minimum-wage workers. Managers should look at other types of rewards that help motivate employees. Many companies use employee recognition programs such as employee of the month, quarterly employee-performance award ceremonies, or other celebrations of employee accomplishment. In service industries, successful companies are empowering these front-line employees with more authority to address customers’ problems. If we use the JCM to examine this change, we can see that this type of job redesign provides enhanced motivating potential because employees now experience increased skill variety, task identity, task significance, autonomy, and feedback.

Professional and technical employees are typically different from nonprofessionals. They have a strong and long-term commitment to their field of expertise. Their loyalty, however, is more often to their profession than to their employer. Money and promotions into management typically are low on their priority list. Their chief reward in their job is the work itself. Professional and technical employees generally also value support. This implies that managers should provide professional and technical employees with new assignments and challenging projects. Give them autonomy to follow their interests and allow them to structure their work in ways they find productive. Reward them with educational opportunities—training, workshops, attending conferences—that allow them to keep current in their field and to network with their peers. Also reward them with recognition. An increasing number of companies are creating alternative career paths for these employees, especially those in highly technical fields such as IT.

Integrative Chapter Skills

Scouting theGlobe
Purpose: The purpose of this case is to introduce students to the various ways in which organizations might compensate their employees through bonuses. The discussion should center on the unique properties and troubles associated with each particular bonus system.
Instruct students to read the scenario below, and put them into groups for the group task indicated below the scenario.
Your consulting team is well known for its expertise in regards to how to best compensate employees of various organizations. Recently, you received an interesting call from a well known businessperson who had just purchased a moribund National Hockey League (NHL) franchise. This organization was part of the recent expansion by the NHL and has been struggling to draw fans.
 The previous owner was harshly criticized in the local press as a penny-pincher. This reputation may have been warranted as the team has lost several high profile free agents over the past several years. A recent survey among General Managers throughout the league rated this franchise’s scouting department and draft success as lowest among all of the NHL franchises. The new owner has decided that rather than chasing after a few free agents to turn the organization around he would focus on player development and drafting. Although this path may take longer for the team to be successful in the win column, he is firmly convinced in his long term strategy.
 Your team has been impressed with his vision. The new owner has decided to completely restructure the scouting department which was initially focused on Canada and Russia into 4 independent divisions including U.S., Canada, Western Europe, and Eastern Europe/Russia. He has asked for your help in devising a scheme to maximize the motivation of the scouts and properly reward great performance. He has already committed to ensuring that his scouts are paid at the 90-100 percentiles in the league and has already hired several competent scouts away from other organizations. However, he strongly feels that the way in which an organization can get even greater performance is through a properly aligned bonus system. Your task is to advise him on the benefits or problems associated with three bonus proposals submitted to him from the scouting department. He asks you plainly, which of these will or will not work and why? He was advised that because this is a team based organization we should somehow construct a group based reward system
 Proposal 1: Bonuses will be provided to the region that scouted the player that the organization selects in the first 3 rounds with more bonuses given for a 1st round pick ect. For example, if the 1st round pick was from Canada, then the Canadian scouting department would receive a bonus.
 Proposal 2: Bonuses will be based on a technical report rating the accurateness of the yearly projections scouts make of the top talent in their various regions. The rating of the various scouting department reports would be accomplished by tracking the assessments of prospects each year with their ultimate performance over the next 3-5 year period. For example, the assessments of players in the year 2007 would be benchmarked against the ultimate performance of the players in the year 2012.
 Proposal 3: The final proposal will be based strictly on the performance of the team. That is, as the team wins more games all of the scouting departments will equally share a bonus.
Group task
Your task as a group is to critique each of these proposals in regards to how each might or might not motivate the individual scouts. What are the proposed strengths of each? What are the critical weaknesses of each? How would you assess all of the proposals in total? If you were to create a more effective bonus system what might it look like? If you had to choose one of these which would you choose?

Teaching Tips

As groups start to work on this task, encourage them to evaluate the strengths and weaknesses through the theoretical lenses of the motivation theories in the chapter.  For example, which of the three plans insures all of the links necessary for motivation based on expectancy theory? Also encourage the students to consider elements of time and circumstances beyond scouts’ control. 
The case also points to the owner’s question about a group based reward system. Students should note whether any of the three really get at a group reward system, and consider which “group” is performing and which “group” would be getting rewarded. For example, is the “group” the scouts, or the playing team?  Or the entire organization? How much interdependence is there among scouts?  Does it make sense to consider them a team?  This case should spark a rich discussion amongst students that you the instructor can take in a variety of directions. 

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