12 Chapter Motivation

Learning Objectives By the conclusion of this discussion you will understand: The different ways to view and use motivation. The many motivational theories and how management can use these theories to obtain higher performance. How to tie pay to performance. © Copyright McGraw-Hill. All rights reserved.

The Nature of Motivation Motivation- conscious decision to perform activities with greater effort than other competing activities. 1) direction of behavior in an organization 2) how hard people work 3) persistence displayed in meeting goals Intrinsic Motivation Extrinsic Motivation Intrinsic Motivation Behavior that is performed for its own sake. The source of the motivation that comes from actually engaging in the behavior. The sense of accomplishment and achievement derived from doing the work itself Extrinsic Motivation Behavior that is performed to acquire material or social rewards or to avoid punishment. The source of the motivation is the consequences of the behavior and not the behavior itself. © Copyright McGraw-Hill. All rights reserved.

Sources of Motivation Personal Characteristics Nature of the Job Individual Motivation Nature of the Organization © Copyright McGraw-Hill. All rights reserved.

The Motivation Equation Outcome Anything a person gets from a job or an organization Pay, job security, autonomy, accomplishment Input Anything a person contributes to his or her job or organization Time, effort, skills, knowledge, work behaviors © Copyright McGraw-Hill. All rights reserved. Figure 12.1

Expectancy Theory Developed by Victor Vroom Popular theory of work motivation Consists of three areas: Expectancy Instrumentality Valence Motivation will be high when workers believe: High levels of effort will lead to high performance. High performance will lead to the attainment of desired outcomes. Major Factors of Motivation Expectancy—the belief that effort (input) will result in a certain level of performance Instrumentality—the belief that performance results in the attainment of outcomes Valence—how desirable each of the available outcomes from the job is to a person © Copyright McGraw-Hill. All rights reserved.

Expectancy, Instrumentality, and Valence Expectancy: Effort will result in a level of performance. Employees will work work hard if they believe they can attain high performance—organizations must provide the resources that support performance. Instrumentality: Performance leads to outcomes. Workers are only motivated if they think performance leads to an outcome—managers must link performance to outcomes. Valence: How desirable an outcome is to a person. Workers have preferences for outcomes—managers must determine which outcomes are valued. Source: © Copyright McGraw-Hill. All rights reserved. Figure 12.2

Expectancy Theory Motivation is highest when expectancy, instrumentality, and valence levels are high. If one of the values is low, motivation will be low. Workers do not believe they can perform well. Workers do not believe that performance and rewards are closely linked. Workers do not value the rewards offered for performance. Source: © Copyright McGraw-Hill. All rights reserved. Figure 12.3

Need Theories Need Theories Theories of motivation that focus on what needs people are trying to satisfy at work and what outcomes will satisfy those needs. Basis premise is that people are motivated to obtain outcomes at work to satisfy their needs. Managers must determine what needs a worker wants satisfied and ensure that a person receives the outcomes when performing well. Need A requirement for survival and well-being. © Copyright McGraw-Hill. All rights reserved.

Maslow’s Hierarchy of Needs Self- actualization Realize one’s full potential Use abilities to the fullest Esteem Feel good about oneself Promotions and recognition Belongingness Social interaction, love Interpersonal relations, parties Safety Security, stability Job security, health insurance Physiological Food, water, shelter Basic pay level to buy items Needs Description Examples Lower-level needs must be satisfied before higher-level needs are addressed. Highest-level needs Lowest-level needs © Copyright McGraw-Hill. All rights reserved. Table 12.1

Adequate pay for necessities Alderfer’s ERG Theory After lower level needs satisfied, person seeks higher needs. When unable to satisfy higher needs, lower needs motivation is raised. Growth Self-development, creative work Continually improve skills Relatedness Interpersonal relations, feelings Good relations, accurate feedback Existence Food, water, clothing, and shelter Adequate pay for necessities Needs Description Examples Highest-level needs Lowest-level needs Source: © Copyright McGraw-Hill. All rights reserved. Table 12.2

Herzberg’s Motivation-Hygiene Theory Motivator needs - relate to the nature of the work itself—autonomy, responsibility, interesting work. Motivate and create job satisfaction Hygiene needs - relate to the physical and psychological context of the work—comfortable work environment, pay, job security. Create dissatisfaction; satisfaction of hygiene needs does not lead to motivation or job satisfaction. Focuses on outcomes that lead to higher motivation and job satisfaction, and those outcomes that can prevent dissatisfaction. © Copyright McGraw-Hill. All rights reserved.

McClelland’s Needs for Achievement, Affiliation, and Power Need for Achievement A strong need to perform challenging tasks well and meet personal standards for excellence Need for Affiliation A concern for good interpersonal relations, being liked, and getting along Need for Power A desire to control or influence others © Copyright McGraw-Hill. All rights reserved.

Adam’s Equity Theory Focuses on people’s perceptions of the fairness (or lack of fairness) of their work outcomes in proportion to their work inputs. A relative outcome to input ratio comparison to oneself or to another person (referent) perceived as similar to oneself. Equity exists when a person perceives that their outcome/input ratio to be equal to the referent’s ratio. If the referent receives more outcomes, they should also give more inputs to achieve equity. © Copyright McGraw-Hill. All rights reserved.

Outcomes < Outcomes Outcomes > Outcomes Equity Theory Condition Person Referent Example Equity Outcomes = Outcomes Inputs Inputs Worker contributes more inputs but also gets more outputs than referent Underpayment Outcomes < Outcomes gets the same outputs as referent Overpayment Outcomes > Outcomes same inputs but also Inequity exists when worker’s outcome/input ratio is not equal to referent. Underpayment inequity: ratio is less than the referent. Workers feel they are not getting the outcomes they should for their inputs. Overpayment inequity: ratio is higher than the referent. Workers feel they are getting more outcomes than they should for their inputs. Restoring Equity: Inequity creates tension in workers causing them to attempt to restore equity. In underpayment, workers may reduce input levels to correct (rebalance) the ratio or seek a raise. In overpayment, workers may change the referent person and readjust their ratio perception. If inequity persists, workers will often choose leave the organization. © Copyright McGraw-Hill. All rights reserved. Table 12.3

Goal Setting Theory Focuses on identifying the types of goals that are effective in producing high levels of motivation and explaining why goals have these effects. Specific and not vague in providing direction Difficult but not impossible to attain Accepted and committed to by workers Feedback on goal attainment is important. Reward Considers how managers can ensure that workers focus their inputs in the direction of high performance and the achievement of organizational goals. Goals point out what is important to the firm. Workers should be encouraged to develop action plans to attain goals. © Copyright McGraw-Hill. All rights reserved.

Management by Objectives MBO – philosophy that a manager and subordinate ought to negotiate and define goals for the employee to pursue. Four Step Process: Set goals (collaboratively) Action plan Self-monitoring and corrective action Periodic reviews Can be an effective tool. Only works in a collaborative environment. Reviews are essential to ensure it is just not filling out paper work. © Copyright McGraw-Hill. All rights reserved.

Learning Theories Learning - a relatively permanent change in person’s knowledge or behavior that results from practice or experience. Operant Conditioning Organizational Behavior Modification (OB Mod) Social Learning Theories that focus on increasing motivation and performance by linking outcomes to performance and the attainment of goals. © Copyright McGraw-Hill. All rights reserved.

S C R Operant Conditioning Theory that people learn to perform behaviors that lead to desired consequences and visa versa. S C R stimulus response consequence Stop light example. Hot stove example. Child crying in store example. Operant Conditioning People learn to perform behaviors that lead to desired consequences and learn not to perform behaviors that lead to undesired consequences. Linking specific behaviors to the attainment of specific outcomes can motivate high performance and prevent behaviors that detract from organizational effectiveness. © Copyright McGraw-Hill. All rights reserved.

Operant Conditioning Consequences Positive Reinforcement Getting desired outcomes for performing desired behaviors Negative Reinforcement Eliminating undesired outcomes once the desired behavior occurs © Copyright McGraw-Hill. All rights reserved.

Operant Conditioning Consequences Punishment Administering an undesired/negative consequence to immediately stop a dysfunctional behavior. Extinction Curtailing the performance of a dysfunctional behavior by eliminating whatever is reinforcing it. Behavior is not rewarded and over time, the worker stops performing it. © Copyright McGraw-Hill. All rights reserved.

S C R stimulus response consequence Positive Reinforcement Punishment Increases Likelihood of behavior Decreases Likelihood of Behavior Get what you like Positive Reinforcement Get what you dislike Punishment Get something you don’t like withheld Negative Reinforcement Get something you like withheld Extinction © Copyright McGraw-Hill. All rights reserved.

Organizational Behavior Modification Organizational Behavior Modification (OB MOD) The systematic application of operant conditioning techniques to organizationally functional behaviors and discourage dysfunctional behaviors. Improves productivity, attendance, punctuality and other behaviors that are specific, objective and countable. Has been criticized for ethicality of application and effects on workers. Appears to be effective in promoting organizational efficiency. © Copyright McGraw-Hill. All rights reserved.

Yes No Steps in Organizational Behavior Modification Identify behavioral performance problem Steps in Organizational Behavior Modification Chart frequency of target behavior Analyze existing behavioral conting. Evaluate performance over time Develop contingency intervention strategy Reinforce to maintain desired behavior Apply contingency intervention strategy Problem Solved? Chart frequency of resulting behavior Yes No © Copyright McGraw-Hill. All rights reserved.Management and Organizaitonal Behavior, 2nd Edition, Cook, Hunsaker, Coffey, 1997

Social Learning Theory A theory that takes into account how learning and motivation are influenced by people’s thoughts and beliefs and their observations of other people’s behavior. Vicarious Learning (Observational Learning) Learning that occurs when a learner is motivated to perform a behavior by watching another person perform and be rewarded. People are motivated to imitate models who are highly competent, expert, receive attractive reinforcers, and are friendly or approachable. Conditions for Social Learning The learner observes the model performing the behavior. The learner accurately perceives the model’s behavior. The learner remembers the behavior. The learner has the skills and abilities needed to perform the behavior. The learner sees or knows that the model is positively reinforced for the behavior. Self-Reinforcement Any desired or attractive outcome or award that a person can give himself or herself for good performance. “The self-management of behavior” Self-efficacy A person’s belief about his or her ability to perform a behavior successfully. Influences motivation both when managers provide reinforcement and when workers themselves provide it. © Copyright McGraw-Hill. All rights reserved.

Pay and Motivation Pay as a Motivator Expectancy: pay is an instrumentality (and outcome), must be high for motivation to be high. Need Theory: pay is used to satisfy many needs. Equity Theory: pay is given in relation to inputs. Goal Setting Theory: pay is linked to attainment of goals. Learning Theory: outcomes (pay), is distributed upon performance of functional behaviors. © Copyright McGraw-Hill. All rights reserved.

Merit Pay and Performance Merit Pay Plan A compensation plan that bases pay on based on individual, group and/or organization performance. Individual plan: when individual performance (sales) can accurately measured. Group plan: when group that works closely together is measured and rewarded as a group. Organization plan: when group or individual outcomes not easily measured. © Copyright McGraw-Hill. All rights reserved.

Salary Increase or Bonus? Motivational Value of a Bonus Is Higher When: Salary levels are unrelated to current performance. Changes in other compensation items (cost of living, seniority) are not having a large effect in increasing compensation. Salaries rarely change and performance does. Benefits of Using Bonuses Do not become permanent part of compensation Are more directly tied to current performance Provide more flexibility in distributing rewards © Copyright McGraw-Hill. All rights reserved.

“Good leaders don’t create motivation, they unlock it.” Conclusion “Good leaders don’t create motivation, they unlock it.” Managers must know their employees and understand what motivates each of them. Performance pay plans can improve performance if utilized appropriately. © Copyright McGraw-Hill. All rights reserved.