PowerPoint Presentation by Charlie Cook The University of West Alabama © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Learning Objectives 1.Characterize the nature of motivation, including its importance and historical perspectives. 2.Identify and describe the major content perspectives on motivation. 3.Identify and describe the major process perspectives on motivation. 4.Describe reinforcement perspectives on motivation. 5.Identify and describe popular motivational strategies. 6.Describe the role of organizational reward systems in motivation. 16–2 © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

The Nature of Motivation MotivationMotivation  The set of forces that cause people to behave in certain ways.  The goal of managers is to maximize desired behaviors and minimize undesirable behaviors. The Importance of Motivation in the WorkplaceThe Importance of Motivation in the Workplace  Determinants of Individual Performance  Motivation—the desire to do the job.  Ability—the capability to do the job.  Work environment—the resources to do the job. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–3

Process PerspectivesContent Perspectives Search for ways to satisfy need Choice of behavior to satisfy need Determination of future needs and search/choice for satisfaction Evaluation of need satisfaction Need or deficiency The motivation processes through a series of discreet steps. Content, process, and reinforcement perspectives on motivation address different parts of this process. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16– The Motivation Framework

Historical Perspectives on Motivation The Traditional ApproachThe Traditional Approach  Workers are interchangeable tools of production.  Frederick Taylor (Scientific Management)  Assumptions:  Managers know more than workers.  Economic gain (money) is the primary motivation for performance.  Work is inherently unpleasant. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–5

Historical Perspectives on Motivation (cont’d) The Human Relations ApproachThe Human Relations Approach  Emphasized role of social processes in workplace.  Assumptions:  Employees want to feel useful and important.  Employees have strong social needs, more important than money.  Maintaining the appearance of employee participation is important. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–6

Historical Perspectives on Motivation (cont’d) The Human Resource ApproachThe Human Resource Approach  Emphasized value of employees to organization  Assumptions:  Employee contributions are important and valuable to the employee and the organization.  Employees want to and are able to make genuine contributions.  Management’s job is to encourage participation and create a work environment that motivates employees. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–7

Content Perspectives on Motivation Content PerspectivesContent Perspectives  Try to answer the question, “What factors in the workplace motivate people?” Content Perspective TheoriesContent Perspective Theories  Maslow’s Hierarchy of Needs  Aldefer’s ERG Theory  Herzberg’s Two-Factor Theory  McClelland’s Achievement, Power, and Affiliation Needs 16–8 © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Maslow’s Hierarchy of Needs Physiological Belongingness Security Attending to basic survival and biological functions. Seeking a safe physical and emotional environment. Experiencing love and affection. Esteem Having a positive self-image/self-respect and recognition and respect from others. Self-actualization Realizing one’s potential for personal growth and development. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–9

Self- actualization Esteem Belongingness Security PhysiologyFood Achievement Status Friendship Stability Job Friends Pension Base NEEDS General ExamplesOrganizational Examples job Challenging title at work plan salary © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16– Maslow’s Hierarchy of Needs

The Needs Hierarchy Approach Contributions of Maslow’s TheoryContributions of Maslow’s Theory  Identified and categorized individual needs.  Emphasized importance of needs to motivation. Weaknesses of Maslow’s TheoryWeaknesses of Maslow’s Theory  All levels of need are not always present.  Ordering or importance of needs is not always the same.  Cultural differences can impact the ordering and salience of needs. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–11

Content Perspectives… (cont’d) Relatedness Needs Growth Needs Existence Needs The ERG Theory © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–12

Content Perspectives… (cont’d) The ERG Theory (Aldefer)The ERG Theory (Aldefer)  Needs are grouped into overlapping categories:  Existence needs—physiological and security needs.  Relatedness needs—belongingness and esteem by others.  Growth needs—self-esteem and self-actualization.  ERG theory assumes that:  Multiple needs can be operative at one time (there is no absolute hierarchy of needs).  If a need is unsatisfied, a person will regress to a lower-level need and pursue that need (frustration-regression). © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–13

Content Perspectives… (cont’d) The Two-Factor Theory (Herzberg)The Two-Factor Theory (Herzberg)  Satisfaction and dissatisfaction are influenced by two independent sets of factors.  Theory assumes that job satisfaction and job dissatisfaction are on two distinct continuums:  Motivational factors (work content) are on a continuum that ranges from satisfaction to no satisfaction.  Hygiene factors (work environment) are on a separate continuum that ranges from dissatisfaction to no dissatisfaction. 16–14 © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Content Perspectives… (cont’d) The Two-Factor Theory (cont’d)The Two-Factor Theory (cont’d)  Posits that motivation is a two-stage process:  Ensuring that the hygiene factors are not deficient and not blocking motivation.  Giving employees the opportunity to experience motivational factors through job enrichment. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–15

Work Content Motivation Factors Achievement Recognition The work itself Responsibility Advancement and growth SatisfactionNo satisfaction Work Environment Hygiene Factors Supervisors Working conditions Interpersonal relations Pay and security Company policies and administration DissatisfactionNo dissatisfaction © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16– The Two-Factor Theory of Motivation

Management Challenge Despite considerable criticism, Herzberg’s Two- Factor theory continues to be studied in management classes. Why?Despite considerable criticism, Herzberg’s Two- Factor theory continues to be studied in management classes. Why? © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–17

Content Perspectives… (cont’d) Individual Human Needs (McClelland)Individual Human Needs (McClelland) 16–18 © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Need for Achievement Need for Power Need for Affiliation The desire to accomplish a goal or task more effectively than in the past. The desire for human companionship and acceptance. The desire to be influential in a group and to control of one’s environment.

Content Perspectives… (cont’d) Implications of the Content PerspectivesImplications of the Content Perspectives 16–19 © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Content Perspectives (what causes motivation) Process Perspectives (how motivation occurs)

Motivation Process Perspectives Process PerspectivesProcess Perspectives  Approaches to motivation that focus on:  Search for behavioral options and alternatives  Choice of behavioral options to satisfy needs  Rewards and evaluation of satisfaction after goals are attained. Process Perspective TheoriesProcess Perspective Theories  Expectancy Theory  Porter-Lawler Extension of Expectancy Theory  Equity Theory  Goal-Setting Theory © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–20

Motivation Process Perspectives (cont’d) Expectancy TheoryExpectancy Theory  Motivation depends on (1) how much we want something and (2) how likely we are to get it.  Assumes that: 1.Personal and environmental forces determine behavior 2.People make decisions about their behavior in organizations. 3.People have different types of needs, desires, and goals. 4.People choose among alternatives of behaviors in selecting one that that leads to a desired outcome.  Motivation leads to effort that, when combined with ability and environmental factors, results in performance which leads to outcomes having value (valence) to employees. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–21

Elements of Expectancy Theory Effort-to-Performance ExpectancyEffort-to-Performance Expectancy  Employee’s perception of the probability that effort will lead to a high level of performance. Performance-to-Outcome ExpectancyPerformance-to-Outcome Expectancy  Employee’s perception of the probability that performance will lead to a specific outcome—the consequence or reward for behaviors in an organizational setting. 16–22 © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Elements of Expectancy Theory (cont’d) ValenceValence  Is an index of how much an individual values a particular outcome (reward).  Is the attractiveness of the outcome to the individual.  Attractive outcomes have positive valences and unattractive outcomes have negative valences.  Outcomes to which an individual is indifferent have zero valences. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–23

Elements of Expectancy Theory (cont’d) What is required for motivated behavior to occur:What is required for motivated behavior to occur:  Both effort-to-performance expectancy and performance-to-outcome expectancy probabilities must be greater than zero.  The sum of the valences must be greater than zero. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–24

© 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16– The Expectancy Model of Motivation

The Porter-Lawler Extension of Expectancy Theory Assumptions:Assumptions:  If performance results in equitable and fair rewards, people will be more satisfied.  High performance can lead to rewards and high satisfaction. Types of Rewards:Types of Rewards:  Extrinsic rewards are outcomes set and awarded by external parties (e.g., pay and promotions).  Intrinsic rewards are outcomes internal to the individual (e.g., self-esteem and feelings of accomplishment). © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–26

16–27 © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use The Porter–Lawler Extension of Expectancy Theory

Equity Theory EquityEquity  An individual’s belief that the treatment the individual receives is fair relative to the treatment received by others. Theory’s Assumptions Theory’s Assumptions  People are motivated to seek social equity in the rewards they receive for performance.  Individuals view the value of rewards (outcomes) and inputs of effort as ratios and make subjective comparisons of themselves to other people. outcomes (self) inputs (self) = outcomes (other) inputs (other) © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–28

Equity Theory (cont’d) Equity Comparisons of Individuals:Equity Comparisons of Individuals:  Feeling equitably rewarded.  Maintain performance and accept comparison as fair estimate.  Feeling under-rewarded—try to reduce inequity.  Change inputs by trying harder or slacking off.  Change outcomes by demanding a raise.  Distort the ratios by altering perceptions of self or of others.  Leave situation by quitting the job.  Change comparisons by choosing another object person.  Feeling over-rewarded.  Increase or decrease inputs.  Distort ratios by rationalizing.  Help the object person gain more outcomes. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–29

Goal-Setting Theory Theory’s AssumptionsTheory’s Assumptions  Behavior is a result of conscious goals and intentions.  Setting goals influences behavior in organizations. Characteristics of GoalsCharacteristics of Goals  Goal difficulty  Extent to which a goal is challenging and requires effort. –People work harder to achieve more difficult goals. –Goals should be difficult but attainable.  Goal specificity  Clarity and precision of the goal.  Goals vary in their ability to be stated specifically © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–30

Goal-Setting Theory (cont’d) Characteristics of Goals (cont’d)Characteristics of Goals (cont’d)  Goal acceptance  The extent to which persons accept a goal as their own.  Goal commitment  The extent to which an individual is personally interested in reaching a goal. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–31

Implications of the Process Perspectives If rewards are to motivate employees, they must be perceived as being valued, attainable, fair and equitable.If rewards are to motivate employees, they must be perceived as being valued, attainable, fair and equitable. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–32

© 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16– The Expanded Goal-setting Theory of Motivation

Reinforcement Perspectives on Motivation Reinforcement TheoryReinforcement Theory  The role of rewards as they cause behavior to change or remain the same over time.  Assumes that:  Behavior that results in rewarding consequences is likely to be repeated.  Behavior that results in punishing consequences is less likely to be repeated. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–34

Reinforcement in Organizations 16–35 © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Positive Reinforcement Avoidance Punishment Extinction Kinds of Reinforcement

Reinforcement Perspectives (cont’d) Fixed IntervalVariable Interval Fixed Ratio Variable Ratio Reinforcement Schedules TimeFrequency © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–36

Arrangement of the Reinforcement Contingencies Positive reinforcementStrengthens behavior by providing a desirable consequence AvoidanceStrengthens behavior by allowing escape from an undesirable consequence PunishmentWeakens behavior by providing an undesirable consequence ExtinctionWeakens behavior by ignoring it Schedules for Applying Reinforcement Fixed-intervalReinforcement is applied at fixed time intervals, regardless of behavior Variable-intervalReinforcement is applied at variable time intervals Fixed-ratioReinforcement is applied after a fixed number of behaviors, regardless of time Variable-ratioReinforcement is applied after a variable number of behaviors © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16– Elements of Reinforcement Theory

Reinforcement Perspectives (cont’d) Behavior Modification (OB mod)Behavior Modification (OB mod)  A method for applying the basic elements of reinforcement theory in an organizational setting.  Specific behaviors are tied to specific forms of reinforcement. Implications of the Reinforcement PerspectivesImplications of the Reinforcement Perspectives  Consistently applied reinforcement helps maintain employee motivation by:  encouraging (rewarding) positive behaviors.  discouraging (punishing) dysfunctional behaviors. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–38

Popular Motivational Strategies Empowerment and ParticipationEmpowerment and Participation  Empowerment  Enabling workers to set their work goals, make decisions, and solve problems within their sphere of influence.  Participation  Giving employees a voice in making decisions about their work.  Areas of participation for employees:  Making decisions about their jobs.  Decisions about administrative matters  Participating in decision making about broader issues of product quality. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–39

Popular Motivational Strategies (cont’d) Techniques and Issues in EmpowermentTechniques and Issues in Empowerment  Using work teams  Collections of employees empowered to plan, organize, direct, and control their work  Decentralization  Changing the overall method of organizing the firm  Conditions necessary for empowerment:  Power spread to lower organizational levels  Commitment to empowering workers  Systematic and patient efforts to empower workers  Increased commitment to training © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–40

Popular Motivational Strategies (cont’d) Alternative Forms of Working ArrangementsAlternative Forms of Working Arrangements 16–41 © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Compressed work schedule Flexible work schedules (flextime) Job sharing Telecommuting Variable Work Schedules

Using Reward Systems to Motivate Performance Reward SystemsReward Systems  Formal and informal mechanisms by which employee performance is defined, evaluated, and rewarded. Effects of Organizational RewardsEffects of Organizational Rewards  Higher-level performance-based rewards motivate employees to work harder.  Rewards help align employee self-interest with organizational goals.  Rewards foster increased retention and citizenship. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–42

Reward Systems and Performance Individual Incentive Rewards Systems Group and Team Incentive Rewards Systems Individual Merit Rewards Systems Types of Reward Systems © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–43

Using Reward Systems to Motivate Performance (cont’d) Merit Reward SystemsMerit Reward Systems  Base a meaningful portion of individual compensation on merit—the relative value of an individual’s contributions to the organization.  Employees who make greater contributions are given higher pay than those who make lesser contributions. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–44

Using Reward Systems to Motivate Performance (cont’d) Incentive Reward SystemsIncentive Reward Systems  Concept:  Employee pay is based on employee output.  Assume that:  Performance is under control of individual worker.  Employee works at a single task continuously.  Pay is tightly tied to performance (i.e., pay varies with output). © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–45

Using Reward Systems to Motivate Performance (cont’d) Incentive Reward Systems (cont’d)Incentive Reward Systems (cont’d)  Incentive pay plans  Piece-rate systems  Sales commissions  Non-monetary incentives (perks) Team and Group Incentive Reward SystemsTeam and Group Incentive Reward Systems  Gainsharing programs  Scanlon Plan  Employee stock ownership plans (ESOPs) © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–46

Executive Compensation Standard Forms of Executive CompensationStandard Forms of Executive Compensation  Base salary  Incentive pay (bonuses) Special Forms of Executive CompensationSpecial Forms of Executive Compensation  Stock option plans  Executive perks Criticism of Executive CompensationCriticism of Executive Compensation  Excessively large compensation amounts  Compensation not tied to overall and long-term performance of the organization  Earnings gap between executive pay and typical employee pay © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–47

New Approaches to Performance-Based Rewards Leveraging the Value of IncentivesLeveraging the Value of Incentives  Allowing individuals and groups in the organization to have a say in how rewards are distributed. Innovative Incentive Programs:Innovative Incentive Programs:  Offering stock options to all employees.  Individualizing the rewards available to individuals in reward systems. © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–48

Management Challenge Question How are expectancy theory, performance appraisal systems, and reward systems linked?How are expectancy theory, performance appraisal systems, and reward systems linked? © 2013 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16–49