1. Applied Performance Practices
McGraw-Hill/Irwin
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

2. Applied Performance Practices in Chinese Factories
Most factory workers in China’s Pearl River Delta are paid for the number of units they produce. The work is usually repetitive – some jobs require several thousand task cycles each day.
Most factory workers in China’s Pearl River Delta are paid for
the number of units they produce. The work is usually
repetitive – some jobs require several thousand task cycles
each day.

3. Meaning of Money in the Workplace
Money means different things to people
symbol of success
reinforcer and motivator
reflection of performance
Source of less/more anxiety
Differences in meaning of money by gender and culture
Money is an important motivator
Rewarding people with money is one of the oldest and most
widespread applied performance practices but money means
different things to different people
• Symbol of achievement/success/status
• Reinforcer and motivator
• Reflection of performance
• Source of enhanced or reduced anxiety
Differences in meaning of money by gender and culture
• Men value money more than women – men tend to view money
as a symbol of power and status
• Cultural values influence the meaning and value of money –
high power distance countries e.g. China and Japan tend to
have high respect and priority for money
Money is an important motivator

4. Membership/Seniority Based Rewards
Fixed wages, seniority increases
Advantages
Guaranteed wages may attract job applicants
Seniority-based rewards reduce turnover
Disadvantages
Doesn’t motivate job performance
Discourages poor performers from leaving
May act as golden handcuffs (tie people to the job)
Represent the largest part of most paychecks – “pay for pulse”
e.g. fixed wages
Advantages
• Guaranteed wages may attract job applicants
• Seniority-based rewards reduce turnover
Disadvantages
• Do not directly motivate job performance
• Discourages poor performers from leaving voluntarily
• May act as “golden handcuffs” – discourage employees from
quitting

5. Job Status-Based Rewards
Includes job evaluation and status perks
Advantages:
Job evaluation tries to maintain fairness
Motivates competition for promotions
Disadvantages:
Employees exaggerate duties, hoard resources
Reinforces status
Encourage hierarchy, might undermine cost-efficiency and responsiveness
Most organizations reward employees on the basis of the worth
or status of the jobs they occupy – job evaluation methods
result in pay levels that relate to a job’s skill, effort,
responsibility and working conditions
Employees with more valued jobs may have larger offices,
company-paid vehicles and other perks
Advantages:
• Improve feelings of fairness
• Motivates employees to compete for promotions
Disadvantages:
• Employees may exaggerate duties, hoard resources
• Reinforces status mentality vs. egalitarian workplace
• Encourages bureaucratic hierarchy – may undermine costefficiency
and responsiveness to the external environment

6. Competency-Based Rewards
Pay increases with competencies acquired and demonstrated
Skill-based pay
Pay increases with skill modules learned
Advantages
More flexible work force, better quality, consistent with employability
Disadvantages
Potentially subjective, higher training costs
Pay increases with competencies acquired and demonstrated
Skill-based pay -- pay increases with number of skill blocks/
modules learned e.g. technical skills
Advantages
• More flexible and multiskilled work force
• Better product/service quality; consistent with employability
Disadvantages
• Competency definitions may become vague/subjective – skillbased
plans are more objective
• Increases training costs

7. Organizational Rewards
Types of organizational rewards
Organizational bonuses (e.g. company trips)
Employee stock ownership plans (ESOPS)
Stock options
Profit-sharing plans
Evaluating organizational rewards
Creates an “ownership culture”
Adjusts pay with firm's prosperity
Weak link between individual effort and rewards
Rewards affected by external forces
Individual-level rewards – bonuses for task accomplishment or
exceeding performance goals; commissions; piece rate systems
Team Rewards – e.g. gainsharing plans – calculate bonuses
from the work unit’s cost savings and productivity improvement
Types of Organizational Rewards
• Organizational bonuses e.g. productivity gains, trips
• Employee share ownership plans (ESOPs) – reward systems
that encourage employees to buy company shares
• Share options – gives employees the right to purchase company
shares at a future date at a predetermined price
• Profit-sharing plans – pays bonuses to employees on the basis
of the previous year’s level of corporate profits
Evaluating Organizational Rewards
• ESOPs and share options create an “ownership culture”
• Profit-sharing automatically adjusts pay with firm’s prosperity
• Problem – perceived weak connection between individual effort
and rewards -- e.g., company’s stock price/profitability is
influenced by external forces (beyond the employees’ control)

8. Improving Reward Effectiveness
Link rewards to performance
Ensure rewards are relevant
Team rewards for interdependent jobs
Ensure rewards are valued
Watch out for unintended consequences
Link rewards to performance – employees with better
performance should be rewarded more than those with poorer
performance)
Ensure rewards are relevant – align rewards with performance
within the employee’s control i.e. see a “line of sight”
Use team rewards for interdependent jobs – use team rewards
when employees work in highly interdependent jobs because it
is difficult to measure individual performance in these
situations
Ensure rewards are valued – rewards work best when they are
valued i.e. avoid false assumptions about what employees
want
Watch out for unintended consequences – consider possible
undesirable effects on employee behaviors

9. Unintended Consequences of Rewards at TransSantiago
Transit bus drivers in Santiago, Chile were paid by the number of passengers
Motivated starting work on time, shorter breaks, efficient driving, ensuring passengers paid fares
Unintended consequences
Traffic accidents -- reckless driving to next stop, cut off competing buses
Passenger injuries/deaths – doors left open, buses departed before all on board
Drove past stops with only one passenger waiting
Transit bus drivers in Santiago, Chile, were paid by the number
of fare-paying passengers. This incentive system motivated
drivers to begin their route on time, take shorter breaks and
drive efficiently, however, unintended results occurred:
• Reckless driving to the next passenger waiting area, cutting off
competing buses; many passenger injuries/fatalities because
drivers speeded off before passengers were seated, drove past
stops where only one passenger was waiting, many traffic
accidents.

10. Job Design
Assigning tasks to a job, including the interdependency of those tasks with other jobs
Organization's goal -- to create jobs that can be performed efficiently yet employees are motivated and engaged
The process of assigning tasks to a job, including the
interdependency of those tasks with other jobs
Organization's goal – to create jobs that allow work to be performed
efficiently yet employees are motivated and engaged

11. Job Specialization
Dividing work into separate jobs, each with a subset of tasks required to complete the product/service
Scientific management
Frederick Winslow Taylor
Champion of job specialization
Taylor also emphasized person-job matching, training, goal setting, work incentives
The result of division of labour in which each job includes a
subset of the tasks required to complete the product or service
Scientific management
Advocated by Frederick Winslow Taylor in early 1900s
Mainly associated with high levels of job specialization and
standardization of tasks to achieve maximum efficiency for
maximum efficiency
Taylor also emphasized person-job matching, training, goal
setting, work incentives

12. Evaluating Job Specialization
Advantages
Disadvantages
Less time changing activities
Lower training costs
Job mastered quickly
Better person-job matching
Job boredom
Discontentment pay
Higher costs
Lower quality
Lower motivation
Advantages
• Less time changing activities; lower training costs; jobs
mastered quickly; better person-job matching
Disadvantages
• Job boredom; discontentment pay to attract employees
resulting in higher costs; reduced work quality; undermines the
motivational aspect of jobs

13. Job Characteristics Model
Critical
Psychological
States
Core Job
Characteristics
Outcomes
Work
motivation
Growth
satisfaction
General
effectiveness
Feedback
from job
Knowledge
of results
Skill variety
Task identity
Task significance
Meaningfulness
Autonomy
Responsibility
Identifies five core job dimensions that produce three
psychological states
Core job characteristics
• Skill variety – the use of different skills and talents to perform
tasks within their jobs e.g. sales clerks also stock inventory and
change store-front displays
• Task identity – the degree to which a job requires completion of
a whole or identifiable piece of work e.g. assembling an entire
broadband modem rather than just soldering circuitry
• Task significance – the degree to which a job has a substantial
impact on the organization ad/or larger society e.g.
manufacturing quality of medical devices impact life and death
of patients
• Autonomy – jobs with high autonomy provide freedom,
independence and discretion in scheduling the work and
determining procedures
• Job feedback – the degree to which employees can tell how
well they are doing on the basis of direct feedback from the job
itself
Critical Psychological States
• Experienced meaningfulness – belief that one’s work is
worthwhile or important
• Experienced responsibility – feel personally accountable
• Knowledge of results – information on consequences of work
effort
Individual Differences – job design doesn’t increase work
motivation for everyone in every situation
• Employees must have skills and knowledge to master job
• May not motivate employees dissatisfied with their work context
e.g. working conditions, however research findings are mixed
Individual
differences

14. Improving Task Significance Through Voice of the Customer
Rolls Royce Engine Services improved task significance through their “Voice of the Customer” program, in which customers talk to production staff about how the quality of their engine maintenance work is important to customers.
Rolls Royce introduced “Voice of the Customer,” an initiative in
which customers visit the facility where aircraft engines are
repaired and talk to production staff about how the quality of
these engines is important to them. “It gives employees with
relatively repetitive jobs the sense that they’re not just working
on a part but rather are key in keeping people safe.”

15. Job Rotation Moving from one job to another Benefits
Minimizes repetitive strain injury
Multiskills the workforce
Potentially reduces job boredom
Job ‘A’
Job ‘B’
The practice of moving employees from one job to another
Benefits
• Minimizes health risks from repetitive strain and heavy lifting
• Supports multi-skilling which increases workforce flexibility
• Potentially reduces the boredom of highly repetitive jobs
Job ‘D’
Job ‘C’

16. Job Enlargement Adding tasks to an existing job
Example: video journalist
Video journalist
• Operates camera
• Operates sound
• Reports story
Employee 1
Operates camera
Employee 2
Operates sound
Employee 3
Reports story
Traditional news team
The practice of adding more tasks to an existing job – skill
variety increases because there are more tasks to perform
Example: Video journalist is an example of an enlarged job
• A traditional news team consists of a camera operator, a sound
and lighting specialist, and the journalist who writes and reports
the story
• One video journalist performs all of these tasks

17. Job Enrichment
Given more responsibility for scheduling, coordinating, and planning one’s own work
1. Clustering tasks into natural groups
Stitching highly interdependent tasks into one job
e.g., video journalist, assembling entire product
2. Establishing client relationships
Directly responsible for specific clients
Communicate directly with those clients
The practice of giving employees more responsibility for
scheduling, coordinating, and planning one’s own work –
generally higher job satisfaction/work motivation as well as
lower absenteeism and turnover results
Enrichment strategies:
1. Natural grouping – combining interdependent tasks into one job
e.g. video journalist completes an entire product (a news story)
2. Establishing client relationships – putting employees in direct
contact with their clients -- supervisor isn’t a go-between

18. Dimensions of Empowerment
Self-determination
Employees feel they have freedom and discretion
Meaning
Employees believe their work is important
Competence
Employees have feelings of self-efficacy
Empowerment is a psychological concept with four dimensions:
Self determination
• Empowered employees feel that they have freedom,
independence, and discretion over their work activities
Meaning
• Employees who feel empowered care about their work and
believe that what they do is important
Competence
• Empowered employees are confident about their ability to
perform the work well and have a capacity to grow with new
challenges (self-efficacy)
Impact
• Empowered employees view themselves as active participants
in the organization – their decisions and actions influence the
company’s success
Impact
Employees feel their actions influence success

19. Supporting Empowerment
Individual factors
Possess required competencies, able to perform the work
Job design factors
Autonomy, task identity, task significance, job feedback
Organizational factors
Resources, learning orientation, trust
Individual factors
• Possess required competencies, able to perform the work and
handle the additional decision making requirements
Job characteristics (job design factors)
• Autonomy, task identity, task significance, receive job feedback
Organizational factors
• Resources and information is accessible, learning orientation
culture, employees are trusted

20. Self-Leadership
The process of influencing oneself to establish the self-direction and self-motivation needed to perform a task Includes concepts/practices from goal setting, social cognitive theory, and sports psychology
Self-leadership at Bayer CropScience
The process of influencing oneself to establish the selfdirection
and self-motivation needed to perform a task
Includes concepts/practices from:
• Goal setting
• Social cognitive theory
• Sports psychology – constructive thought processes
6-20

21. Elements of Self-Leadership
Personal
Goal Setting
Constructive
Thought
Patterns
Designing
Natural
Rewards
Self-
Monitoring
Self-
Reinforce-
ment
Personal goal setting Employees set their own goals Apply effective goal setting practices
• Set goals for your own work effort
• Apply effective goal setting practices
• Requires a high degree of self-awareness

22. Elements of Self-Leadership
Personal
Goal Setting
Constructive
Thought
Patterns
Designing
Natural
Rewards
Self-
Monitoring
Self-
Reinforce-
ment
Positive self-talk
Talking to ourselves about thoughts/actions
Potentially increases self-efficacy
Mental imagery
Mentally practicing a task
Visualizing successful task completion
Self-talk – the process of talking to ourselves about our own
thoughts or actions
Positive self-talk increases self-efficacy
Mental imagery – process of mentally practicing a task and
visualizing its successful completion

23. Elements of Self-Leadership
Personal
Goal Setting
Constructive
Thought
Patterns
Designing
Natural
Rewards
Self-
Monitoring
Self-
Reinforce-
ment
Finding ways to make the job itself more motivating
e.g. altering the way the task is accomplished
Finding ways to make the job more motivating e.g. altering the
way the task is accomplished – making slight changes to suit
their needs and preferences

24. Elements of Self-Leadership
Personal
Goal Setting
Constructive
Thought
Patterns
Designing
Natural
Rewards
Self-
Monitoring
Self-
Reinforce-
ment
Keeping track of your progress toward the self-set goal
Looking for naturally-occurring feedback
Designing artificial feedback
Keeping track at regular intervals of one’s progress toward a
self-set goal
Using naturally-occurring feedback e.g. lawn maintenance
employees can see improving appearance of client’s lawn
Designing feedback systems e.g. arranging to receive a
monthly report on sales levels

25. Elements of Self-Leadership
Personal
Goal Setting
Constructive
Thought
Patterns
Designing
Natural
Rewards
Self-
Monitoring
Self-
Reinforce-
ment
“Taking” a reinforcer only after completing a self-set goal
e.g. Watching a movie after writing two more sections of a report
e.g. Starting a fun task after completing a task that you don’t like
“Taking” a reinforcer only after completing a self-set goal e.g.
taking a break after reaching a pre-determined stage of your
work – self-induced form of positive reinforcement

26. Self-Leadership Contingencies
Individual factors
Higher levels of conscientiousness and extroversion
Positive self-evaluation (self-esteem, self-efficacy, internal locus)
Organizational factors
Job autonomy
Participative and trustworthy leadership
Measurement-oriented culture
Individual factors
• Self-leadership behaviors more frequently found in people with
higher levels of conscientiousness and extroversion
• More likely to apply self-leadership strategies when people have
a positive self-concept evaluation (i.e. self-esteem, self-efficacy,
and internal locus of control)
Organizational factors
• Employees need some degree of autonomy
• Have an empowering/trusting rather than controlling boss
• Culture emphasizes continuous measurement of performance

27. Applied Performance Practices