1. Motivating Employees Chapter 10 McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

2. 1. Explain Taylor’s theory of scientific management. 2. Describe the Hawthorne studies and their significance to management. 3. Identify the levels of Maslow’s hierarchy of needs and apply them to employee motivation. 4. Distinguish between the motivators and hygiene factors identified by Herzberg. 5. Differentiate among Theory X, Theory Y, and Theory Z. LEARNING GOALS Chapter Ten 10-2

3. 6. Explain the key principles of goal-setting, expectancy, reinforcement, and equity theories. 7. Show how managers put motivation theories into action through such strategies as job enrichment, open communication, and job recognition. 8. Show how managers personalize motivation strategies to appeal to employees across the globe and across generations. LEARNING GOALS Chapter Ten 10-3

4. ANDREW CHERNG Panda Express Cherng considers the wellness of his staff as an important key to the company’s success. Managers are urged to eat a healthy diet, exercise regularly, and attend company motivational seminars that often include hugs! Profile He hopes to have 2,300 American stores in operation by 2015. 10-4

5. The employees of this company are told exactly how to do their jobs – and we do mean exactly. For instance they are instructed to carry their keys on their ring finger with the teeth up. If they are considered too slow, a supervisor will shadow them with a stopwatch and clipboard and prod them along. Name that company! NAME that COMPANY Chapter Ten 10-5

6. INTRINSIC REWARDS Intrinsic Rewards -- Personal satisfaction you feel when you perform well and complete goals. Examples of Intrinsic Rewards: The Value of Motivation  Pride in your performance  Sense of achievement 10-6

7. EXTRINSIC REWARDS Extrinsic Rewards -- Something given as a recognition of good work. Kinds of Extrinsic Rewards:  Pay Raises  Promotions  Awards The Value of Motivation 10-7

8. FRINGE BENEFITS Perks Offered to Employees at Top 50 Employers Source: Bloomberg BusinessWeek, www.businessweek.com, accessed June 2011.www.businessweek.com The Value of Motivation 10-8

9. TAYLOR’S SCIENTIFIC MANAGEMENT Scientific Management -- Studying workers to find the most efficient ways of doing things and then teaching people those techniques. Three Key Elements to Increase Productivity 1. Time 2. Methods of Work 3. Rules of Work Frederick Taylor: The Father of Scientific Management LG1 10-9

10. TAYLOR’S FOUR KEY PRINCIPLES 1. Study how a job is performed. Gather time & motion information. Check different methods. 2. Codify the best method into rules. 3. Choose workers whose skill matches the rules. 4. Establish a fair level of performance and pay. LG1 Frederick Taylor: The Father of Scientific Management 10-10

11. TIME-MOTION STUDIES Time-Motion Studies -- Studies of which tasks must be performed to complete a job and the time needed to do each task. Led to the development of the Principle of Motion Economy -- Every job can be broken down into a series of elementary motions; developed by Frank and Lillian Gilbreth. LG1 Frederick Taylor: The Father of Scientific Management 10-11

12. ARE YOU STRESSED? Warnings of Employee Stress Negative attitudes about work Drops in productivity Chronic lateness Absenteeism Careless with details Unable to work with others Withdrawal from co-workers Easily upset or angered LG1 Frederick Taylor: The Father of Scientific Management 10-12

13. TAYLOR and UPS UPS drivers work under strict rules and work requirements.UPS How to get out of their trucks:  Right foot first How fast to walk:  3 ft per second How to hold their keys:  Teeth up, third finger LG1 Frederick Taylor: The Father of Scientific Management 10-13

14. HAWTHORNE STUDIES: PURPOSE AND RESULTS Researchers studied worker efficiency under different levels of light. Productivity increased regardless of light condition. Elton Mayo and the Hawthorne Studies Researchers decided it was a human or psychological factor at play. Hawthorne Effect -- People act differently when they know they are being studied. LG2 10-14

15. MASLOW’S THEORY of MOTIVATION Hierarchy of Needs -- Theory of motivation based on unmet human needs from basic physiological needs to safety, social and esteem needs to self-actualization needs. Needs that have already been met do not motivate. If a need is filled, another higher-level need emerges. Motivation and Maslow’s Hierarchy of Needs LG3 10-15

16. MASLOW’S HIERARCHY of NEEDS LG3 Motivation and Maslow’s Hierarchy of Needs 10-16

17. HERZBERG’S MOTIVATING FACTORS Herzberg’s research centered on two questions: Herzberg’s Motivating Factors  What factors controlled by managers are most effective in increasing worker motivation?  How do workers rank job-related factors in order of importance related to motivation? LG4 10-17

18. JOB CONTENT Herzberg found job content factors were most important to workers – workers like to feel they contribute to the company. Motivators -- Job factors that cause employees to be productive and that give them satisfaction. LG4 Herzberg’s Motivating Factors 10-18

19. JOB ENVIRONMENT Job environment factors maintained satisfaction, but did not motivate employees. LG4 Herzberg’s Motivating Factors Hygiene Factors -- Job factors that can cause dissatisfaction if missing but that do not necessarily motivate employees if increased. 10-19

20. HERZBERG’S MOTIVATORS and HYGIENE FACTORS MotivatorsHygiene Factors Work itself Company policy and administration AchievementSupervision RecognitionWorking conditions ResponsibilityInterpersonal relations Growth and advancement Salary, status and job security LG4 Herzberg’s Motivating Factors 10-20

21. COMPARISON of the THEORIES of MASLOW and HERZBERG LG4 Herzberg’s Motivating Factors 10-21

22. REIGNITE EMPLOYEES’ DRIVE Simple Ways to Reinvigorate Work Life 1. Don’t work alone all the time; partners or teams make work more efficient and fun. 2. Redecorate your space to get away from the same- old, same-old. 3. Don’t complain; think of things to celebrate. LG4 Herzberg’s Motivating Factors Source: Fast Company, March 2010. Photo Courtesy of: Nels Highberg 10-22

23. PROGRESS ASSESSMENT What are the similarities and differences between Taylor’s time-motion studies and Mayo’s Hawthorne studies? How did Mayo’s findings influence scientific management? Draw a diagram of Maslow’s hierarchy of needs. Label and describe the parts. Explain the distinction between what Herzberg called motivators and hygiene factors. Progress Assessment 10-23

24. THEORY X and THEORY Y Douglas McGregor proposed managers had two different sets of assumptions concerning workers. Their attitudes about motivating workers were tied to these assumptions. McGregor called them Theory X and Theory Y. McGregor’s Theory X and Theory Y LG5 10-24

25. ASSUMPTIONS of THEORY X MANAGERS Workers dislike work and seek to avoid it. Workers must be forced or threatened with punishment to get them to perform. Workers prefer to be directed and avoid responsibility. Primary motivators are fear and money. LG5 McGregor’s Theory X and Theory Y 10-25

26. ASSUMPTIONS of THEORY Y MANAGERS People like work, it’s a part of life. Workers seek goals to which they are committed. Commitment to goals depends on perceived rewards. People can use creativity to solve problems. Intellectual capacity is only partially realized. People are motivated by a variety of rewards. LG5 McGregor’s Theory X and Theory Y 10-26

27. THEORY Z William Ouchi researched cultural differences between the U.S. (Type A) and Japan (Type J). Type J committed to the organization and group. Ouchi’s Theory Z Type A focused on the individual. Theory Z is the hybrid approach of Types A and J. LG5 10-27

28. THEORY Z LG5 Ouchi’s Theory Z 10-28

29. GOAL-SETTING THEORY Goal-Setting Theory -- Setting ambitious but attainable goals can motivate workers and improve performance if the goals are accepted, accompanied by feedback, and facilitated by organizational conditions. Goal-Setting Theory and Management by Objectives LG6 10-29

30. APPLYING GOAL-SETTING THEORY Management by Objectives (MBO) -- Involves a cycle of discussion, review and evaluation of objectives among top and middle-level managers, supervisors and employees. Managers formulate goals in cooperation with everyone in the organization. Need to monitor results and reward achievement. LG6 Goal-Setting Theory and Management by Objectives 10-30

31. ORGANIZATIONS USING MBO Toyota Motor Company Emerson Electric Company U.S. Department of Defense LG6 Goal-Setting Theory and Management by Objectives 10-31

32. EXPECTANCY THEORY in MOTIVATION Expectancy Theory -- The amount of effort employees exert on a specific task depends on their expectations of the outcome. Employees ask:  Can I accomplish the task?  What’s my reward?  Is the reward worth the effort? Expectations can vary from person to person. Meeting Employee Expectations: Expectancy Theory LG6 10-32

33. EXPECTANCY THEORY LG6 Meeting Employee Expectations: Expectancy Theory 10-33

34. NADLER & LAWLER’S MODIFICATION Researchers Nadler and Lawler modified expectancy theory and suggested five steps for managers: 1. Determine what rewards employees value. 2. Determine workers’ performance standard. 3. Make sure performance standards are attainable. 4. Tie rewards to performance. 5. Be sure employees feel rewards are adequate. LG6 Meeting Employee Expectations: Expectancy Theory 10-34

35. USING REINFORCEMENT THEORY Reinforcement Theory -- Positive and negative reinforcers motivate a person to behave in certain ways. Positive reinforcement includes praise, pay increases and recognition. Negative reinforcement includes reprimands, reduced pay, and layoff or firing. Extinction is a way of trying to stop behavior by not responding to it. Reinforcing Employee Performance: Reinforcement Theory LG6 10-35

36. EQUITY THEORY Equity Theory -- Employees try to maintain equity between inputs and outputs compared to others in similar positions. Workers often base perception of their outcomes on a specific person or group. Perceived inequities can lead to reduced quality and productivity, absenteeism, even resignation. Treating Employees Fairly: Equity Theory LG6 10-36

37. PROGRESS ASSESSMENT Briefly explain the managerial attitudes behind Theories X, Y and Z. Explain goal-setting theory. Evaluate expectancy theory. When could expectancy theory apply to your efforts or lack of effort? Explain the principles of equity theory. Progress Assessment 10-37

38. ENRICHING JOBS Job Enrichment -- A motivational strategy that emphasizes motivating the worker through the job itself. Motivation Through Job Enrichment Based on Herzberg’s motivators, such as responsibility, achievement and recognition. LG7 10-38

39. MOTIVATION on a BUDGET Tactics of Today’s HR Managers Source: Wall Street Journal, March 1, 2010. LG7 Motivation Through Job Enrichment 10-39

40. KEY CHARACTERISTICS of WORK 1. Skill Variety 2. Task Identity 3. Task Significance 4. Autonomy 5. Feedback LG7 Motivation Through Job Enrichment 10-40

41. TYPES of JOB ENRICHMENT Job Enlargement -- A job enrichment strategy that involves combining a series of tasks into one challenging and interesting assignment. Job Rotation -- A job enrichment strategy that involves moving employees from one job to another. LG7 Motivation Through Job Enrichment 10-41

42. ENRICHMENT by WAY of FLEXIBILITY 60% of employees think they can be productive and efficient outside of the office. 66% of employees would take a lower-paying job if it came with more flexibility. 59% of employees say their company doesn’t have a formal out-of-office work policy. Source: Entrepreneur, May 2011. LG7 Motivation Through Job Enrichment 10-42

43. USING OPEN COMMUNICATION Create a culture that rewards listening. Train managers to listen. Use effective questioning techniques. Remove barriers to open communication. Ask employees what’s important to them. Motivating Through Open Communication LG7 10-43

44. KEEPING the LINES OPEN (Social Media in Business) Businesses can no longer limit themselves to traditional intranets. They must communicate with employees, not to them. Employees expect 24/7 access to what they need with what they have (smartphone, iPad, notebook). 10-44

45. WHEN TOO MUCH is TOO MUCH 24/7 Access Isn’t Always a Good Thing Schedule correspondence:  Don’t check email whenever it arrives, schedule times to check. Pick one task:  Having too much open at once takes attention away from singular tasks. Don’t answer the phone:  Don’t be afraid of voicemail. Maintain human contact:  Don’t look at your computer or phone while someone is at your desk. Keep attention (and respect!) on them. Source: Entrepreneur, December 2010. 10-45

46. RECOGNIZING GOOD WORK Raises are not the only ways to recognize an employee’s performance. Recognition can also include:  Paid time off  Flexible scheduling  Work from home opportunities  Paid child or elder care  Stock options or profit sharing  Company awards  Company events or teams Recognizing a Job Well Done LG7 10-46

47. WORK WELL with OTHERS Keys for Productive Teamwork Have a common understanding of your task. Clarify roles and responsibilities. Set rules. Get to know each other. Communicate openly and often. LG7 Recognizing a Job Well Done 10-47

48. WHAT’S GOOD for YOU Most Positive Remedies for Employee Moral LG7 Recognizing a Job Well Done 10-48

49. WHAT’S BAD for YOU Most Negative Actions for Employee Morale LG7 Recognizing a Job Well Done 10-49

50. SMALL INCENTIVES CAN be BIG MOTIVATORS (Spotlight on Small Business) Things like weekly trips to the movies and Rock Band in the break room help keep employees motivated. Communication, mentoring and group bonding are key elements to success. Open communication and increased responsibility for employees make them feel a real part of the firm. 10-50

51. MOTIVATING EMPLOYEES ACROSS the GLOBE Cultural differences make worker motivation a challenging task for global managers. High-Context cultures require relationships and group trust before performance. Motivating Employees Across the Globe Low-Context cultures believe relationship building distracts from tasks. LG8 10-51

52. IMPORTANCE of CULTURAL COMPENTENCY (Reaching Beyond Our Borders) A better understanding of cultures helps managers increase customer satisfaction and loyalty. It’s not just knowing other languages, it’s knowing what’s proper. UPS operates in over 200 countries successfully by emphasizing diversity. 10-52

53. MOTIVATING ACROSS the GENERATIONS Baby Boomers (1946 – 1964)  Experienced great economic prosperity, job security, optimism about their future Generation X (1965 – 1980)  Raised in dual-career families, attended day care, feeling of insecurity about jobs Generation Y or Millennials (1980 – 2000)  Raised by indulgent parents, used to many comforts like computers and cell phones Motivating Employees Across Generations LG8 10-53

54. GENERATION X in the WORKPLACE Desire economic security but focus more on career security than job security. Good motivators as managers due to emphasis on results rather than work hours. Tend to be flexible and good at collaboration and consensus building. Very effective at giving employee feedback and praise. LG8 Motivating Employees Across Generations 10-54

55. MILLENNIALS and the WORKPLACE Tend to be impatient, skeptical, blunt and expressive. Are tech-savvy and able to grasp new concepts. Able to multi-task and are efficient. Highlight a strong sense of commitment. Place a high value on work-life balance. Fun and stimulation are key job requirements. LG8 Motivating Employees Across Generations 10-55

56. MILLENNIALS and the RECESSION The recession hurt younger workers more deeply than other workers. In July 2010, the unemployment rate was 15.3 percent for those aged 20 to 24, while the overall unemployment rate was 9.5 percent. LG8 Motivating Employees Across Generations 10-56

57. COMMUNICATION ACROSS the GENERATIONS Baby Boomers (1946 – 1964)  Prefer meetings and conference calls. Generation X (1965 – 1980)  Prefer email and will choose meetings only if there are no other options. Generation Y or Millennials (1980 – 2000)  Prefer to use technology to communicate, particularly through social media. Motivating Employees Across Generations LG8 10-57

58. The BEST COMPANIES for WORKERS Source: Fortune Magazine, February 7, 2011. LG8 Motivating Employees Across Generations 10-58

59. PROGRESS ASSESSMENT What are several steps firms can take to increase internal communications and thus motivation? What problems may emerge when firms try to implement participative management? Why is it important to adjust motivational styles to individual employees? Are there any general principles of motivation that today’s managers should follow? Progress Assessment 10-59