1. Motivation theory

2. Why work? MONEY JOB SATISFACTION AFFILIATION ▫Being a ‘part’ of something and meeting other people JOB SECURITY STATUS

3. What is motivation? Something that makes someone want to achieve something ▫What makes you come to school? What motivates one person, does not necessarily motivate another ▫An artist compared to a manager in a business ▫A bus driver compared to a nuclear scientist ▫What motivates me may not motivate you!

4. Intrinsic Motivation: Comes from a source within an individual. E.g. Your values, feelings, personal goals  Taking pride in doing something well  Enjoying the challenge of a job Extrinsic Motivation: Comes from an outside source, i.e. Your employer They want something given to them as a reward E.g. Cash, prize etc.

5. Intrinsic-Extrinsic Motivation: People are not usually one type or the other. But are usually more so one type than the other. Mangers must understand WHAT motivates employees – keeping in the employees’ needs in mind!

6. 6 Motivational Theories 1. Maslow’s Hierarchy of Needs 2. McGregor’s Theory X and Theory Y 3. Herzberg’s Motivation-Hygiene Theory 4. Hackman & Oldman Job Characteristics Model 5. Adam’s Equity Theory 6. Vroom’s Expectancy Theory

7. Survival basic life needs - air, food, drink, shelter, warmth, sleep Security protection, job security, order, law, limits, stability, etc Status achievement, recognition, responsibility, reputation Social Friendships with coworkers Self-actualization personal growth and fulfillment Maslow’s Hierarchy of Needs 1940

8. Maslow put forward a theory that there are five levels of human needs which employees need to have fulfilled at work. Only once a lower level of need has been fully met, would a worker be motivated by the opportunity of having the next need up in the hierarchy satisfied. A business should therefore offer different incentives to workers in order to help them fulfill each need in turn and progress up the hierarchy Model has been adapted to recognize that individuals may be on more than one level at a time, and that they can move up and down hierarchy overnight! Maslow’s Hierarchy of Needs

9. Herzberg 1950 Herzberg split things that motivate into two groups: Motivators and Hygiene factors

10. Believed in two-factor theory: Motivators: Factors that directly motivate employees to work harder Giving responsibility, recognition for good work, sense of achievement, opportunities for promotion Hygiene factors: Factors that can de-motivate if not present but do not actually motivate employees to work harder Pay, working conditions, job security Motivate by using motivators plus ensuring hygiene factors are met Use job enrichment and empowerment : delegating more power to employees to make their own decisions Herzberg 1950

11. Hygiene factors: If you have all of these, you may be content. But you may NOT be motivated: Physical conditions Social conditions Pay & perks Security & stability Clear role Status Motivators: If you have some or all of these, you will be increasingly motivated: Recognition Involvement Responsibility Trust Interesting work Promotions Training & development Herzberg 1950

12. Implications of Theory X and Theory Y: Theory defines how managers view employee motivation. There are 2 types of managers – Theory X and Theory Y Theory X manager believes employees need to be controlled, bribed and coerced into working. Theory Y manager believes that people are willing to work; are creative, independent and self directed when motivated properly. 12 McGregor’s Theory X & Theory Y

13. Theory X people: Dislike work & avoid it if they can Lack ambition Are irresponsible Resist change Prefer to be led Must be controlled and threatened to make them work Don’t want responsibility desire security above all else Theory Y people: naturally work hard, just as they like to play or rest work harder when they are committed to an organisation or gain satisfaction from a task Capable of self control Willing to accept responsibility Imaginative and creative Capable of self-direction

14. Implications of Theory X and Theory Y: ▫Theory X managers may create self-fulfilling prophecy. If a manager believes in Theory X they may create situations where workers become dependent and reluctant. ▫Alternatively, Theory Y managers may create situations where workers respond with initiative and high performance.  Which is required if you want workers that are empowered and can manage themselves – take on some responsibility 14 McGregor’s Theory X & Theory Y

15. Hackman and Oldham Job Characteristics Model (1976) Hackman and Oldham identified five factors of job design that typically contribute to people's enjoyment of a job: Skill Variety – Increasing the number of skills that individuals use while performing work. Task Identity – Enabling people to perform a job from start to finish. Task Significance – Providing work that has a direct impact on the organization or its stakeholders. Autonomy – Increasing the degree of decision making, and the freedom to choose how and when work is done. Feedback – Increasing the amount of recognition for doing a job well, and communicate the results of people's work. Job enrichment addresses these factors by enhancing the job's core dimensions and increasing people's sense of fulfillment. They believed that if you build in more of these factors into each job it may increase job satisfaction.

16. Adam’s Equity Theory People compare their own input to their own perceived reward THEN people compare their input and perceived rewards to one another! Perceived inequity negatively affects motivation When people feel fairly or advantageously treated they are more likely to be motivated; when they feel unfairly treated they are highly prone to feelings of disaffection and demotivation. The way that people measure this sense of fairness is at the heart of Equity Theory. Equity theory thus helps explain why pay and conditions alone do not determine motivation. Equity Theory explains why people can be happy and motivated by their situation one day, and yet with no change to their terms and working conditions can be made very unhappy and demotivated, if they learn for example that a colleague (or worse an entire group) is enjoying a better reward-to-effort ratio. It also explains why giving one person a promotion or pay-rise can have a demotivating effect on others.

17. Victor Vroom Expectancy Theory (1964) The amount of motivation depends on the answers to the 3 questions: ▫Will increased effort will improve performance/success? ▫Will performance/success be rewarded? ▫Does the reward have value? people work harder if they want something. If they have a goal such as wanting a promotion, they tend to work harder to achieve it. If workers feel that their goals are realistic and attainable they are likely to work hard to achieve it. If goal seems far from achieving, workers are seen to be de-motivated.

18. Monetary Rewards ▫Bonus system - Usually only paid when certain targets have been achieved ▫Profit sharing - A system whereby employees receive a proportion of company’s profits ▫Performance related pay - paid to those employees who meet certain targets ▫Share options - common incentive for senior managers who are given shares in company rather than a straightforward bonus or membership of a profit sharing scheme ▫Fringe benefits - Often known as ‘perks’, these are items an employee receives in addition to their normal wage or salary e.g. company car, private health insurance, free meals

19. Non Monetary Rewards Recognition & Praise - recognition for good work and effort Empowerment - delegating power to employees so they can make their own decisions Promotion opportunities - promoting employees to a position of higher responsibility Job enrichment - giving employees more challenging and interesting tasks, responsibility Flexible Hours – ability to determine own work hours Job security – not having to worry your job will be cut

20. Managers & rewards determination: To allocate rewards successfully, the manager must: Understand clearly what rewards people need from their work Distribute rewards and still meet the needs of the organization (ie. can’t give out excessive rewards$$) Everyone is different Keep up-to-date on their needs Treat people fairly Give rewards that are appropriately rewarding the employee and not over or under-doing it!

22. Advantages of a Well Motivated Workforce Better productivity (amount produced per employee) Better quality Lower levels of absenteeism Lower levels of staff turnover (number of employees leaving business) Lower training and recruitment costs